Associated British Foods posted revenue and profit growth in its annual results today (8 November), defying high raw material prices.

For the fiscal year ending 17 September, revenue rose 9% to GBP11.1bn (US$17.8bn), while operating profit was up 3% to GBP842m.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

Profit before tax fell 1% to GBP757m, but last year’s results included a profit of £28m on disposal of businesses, principally the Polish sugar operation to German sugar group Pfeifer & Langen. Net capital investment was GBP825m.

George Weston, chief executive of ABF said opportunities for further investment are “exciting”, and the full-year profits will allow the company to “pursue them with confidence”.

“These results reflect another year of progress for the group. Operating profit improved as our businesses overcame the challenges of high commodity cost inflation and weaker consumer demand,” he said.

The grocery arm of the company saw revenue rise to GBP3.63bn, up from GBP3.4bn in 2010, while adjusted operating profit rose from GBP229m last year to GBP249m.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Sugar was another star performer, with revenue up by 10% and operating profit up 31%. The company said this was achieved with a “significant” increase in Chinese beet sugar production and the benefit of strong world prices. However, weather hit harvests in South Africa, southern China and the UK.

ABF chairman Charles Sinclair said “substantial” inflation in commodity costs such as wheat, vegetable oil, molasses and energy, were mitigated through price increases and efficiencies including reduced energy consumption, reformulated recipes and packaging, and better distribution.

Despite the positive results and a predicted drop in commodity costs, Sinclair was cautious about growth as doubts remain over the global financial climate. 

He said: “The outlook for economic growth in developed economies around the world is subdued and we believe will remain so in the medium term. We expect continued pressure on consumer disposable incomes.”