Associated British Foods today (11 July) reported a 7% increase in third-quarter sales from its grocery business, helped by parts of its UK and Australian units.

ABF said volume sales of Ryvita and Jordans cereals in the UK were up. In a short trading update for the period to 22 June, the company said its UK bread business had “successfully” taken on the contract to supply own-label bread to The Co-operative Group, which is likely to have also boosted grocery volumes. However, it provided no sales guidance on its UK bread business.

The company said the UK retail sugar sector remained “competitive” and sales from its Silver Spoon business were down.

In Australia, which has proven a challenging market for ABF in recent quarters, the company said “recovery was evident”, with revenue “ahead” and an “improvement in profitability”.

The company’s hot drinks business, Twinings Ovaltine, has proven a robust performer. ABF said the unit “maintained its strong growth” in the quarter.

ABF’s grocery division, which accounted for 30% of sales and 17% of profits in the company’s last financial year, has seen sales increase 3% in the first nine months of the current fiscal year.

Group sales were up 8% in the third quarter, boosted not just by grocery but by discount retail chain Primark, where sales were up 20%. ABF’s industrial sugar arm saw sales fall 15%.