AB Foods Sees Good Annual Profit As Momentum Continues

8th Jul 2010 07:15

By Michael Carolan Of DOW JONES NEWSWIRES LONDON (Dow Jones)--U.K. food, ingredients and retail group Associated British Foods (ABF.LN) said Thursday it's on track to deliver very good full-year profit after the sales momentum of its first half continued into the third quarter. The food producer and discount retailer said sales grew 13% in the 16 weeks to June 19, and 14% in the first 40 weeks of the year. "Trading for the group since the half-year remains on track to deliver very good progress in earnings for the full year," the company said. The performance was driven by a 44% increase in the company's sugar operations in both the third quarter and the first nine months. The group is a major sugar producer which also makes food brands such as Twinings tea and Kingsmill bread, as well as operating the discount clothing chain Primark. The European sugar market has now returned to stability following years of disruption as the European Union tried to better balance demand and supply through quota cuts. The company has already forecast good revenue for the current year as its investments of the last few years begin to bear fruit. AB Foods, which is 55%-owned by the founding Weston family, invested GBP586 million last year, expanding its fast-growing Primark chain, growing its sugar operations in southern Africa, bioethanol production in the U.K., and yeast production in China. It also bought Iberian sugar producer Azucarera Ebro. Its shares have climbed more than a quarter in the last year as it shrugged off he effects of the recession. The shares closed Wednesday at 980 pence. -By Michael Carolan, Dow Jones Newswires; 44-20-7842-9278; [email protected] (END) Dow Jones Newswires July 08, 2010 02:15 ET (06:15 GMT)