UK: Grocery profits tumble at ABF
By Dean Best | 6 November 2012
- Adjusted operating profit from grocery down
- Restructuring costs in UK and Australia
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Restructuring charges at ABF's UK bread arm hit grocery profits |
Annual profits from Associated British Foods' grocery business, which includes Kingsmill bread and Jordans cereal, fell 23%, the UK-based group said today (6 November).
Adjusted operating profit from the grocery arm, which also sells brands like Ryvita crispbread, dropped to GBP187m in the year to 15 September from GBP244m a year earlier.
ABF pointed to the cost of restructuring parts of its businesses in the UK and Australia. It also cited a "difficult retail and competitor environment" in Australia, where it sells products under brands including Tip Top.
Revenue from the grocery business was up 1% at GBP3.73bn.
Group adjusted operating profit increased 17% on the back of an 11% rise in revenue. ABF chief executive George Weston pointed to "exceptional performances" from its discount clothing chain Primark and its sugar arm.
Net profit rose from GBP577m a year earlier to GBP583m.
Chairman Charles Sinclair gave a cautious outlook for the year ahead. He said ABF expects profits from sugar to fall but for the decrease to be "more than offset" by growth at Primark and a recovery in earnings from grocery.
Shares in ABF were down 0.51% at 1,359p at 09:41 GMT.
Click here for views from analysts in the City on ABF's grocery results.
Associated British Foods plc results for 52 weeks ended 15 September 2012
ABF delivers a strong set of results
Financial Highlights
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Group revenue up 11% to £12.3bn |
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Adjusted operating profit up 17% to £1,077m* |
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Adjusted profit before tax up 17% to £974m** |
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Adjusted earnings per share up 18% to 87.2p** |
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Dividends per share up 15% to 28.5p |
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Net capital investment of £707m |
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Net debt of £1,061m |
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Operating profit up 4% to £873m, profit before tax level at £761m and basic earnings per share up 2% to 70.3p |
George Weston, Chief Executive of Associated British Foods, said:
"These are very good results for the group and include exceptional performances from AB Sugar and Primark. Global economic uncertainty remains but we have opportunities for further investment and the strength of the group balance sheet and a strong cash flow will enable us to pursue them with confidence."
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before amortisation of non-operating intangibles, profits less losses on disposal of non-current assets and exceptional items. |
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before amortisation of non-operating intangibles, profits less losses on disposal of non-current assets, profits less losses on the sale and closure of businesses and exceptional items. |
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All adjustments to profit measures are shown on the face of the consolidated income statement. Click here for the full release.
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Original source: Associated British Foods
Sectors: Bakery, Cereal, Commodities & ingredients, Condiments, dressings & sauces, Financials, Meat & poultry, World foods
Companies: Associated British Foods, Jordans
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