Associated British Foods has issued a warning over consumer spending for the year ahead despite pre-tax profits rising more than a quarter in the past 12 months.
Grocery sales for the year to 18 September were up 7% to £3.4bn, buoyed by increased market share for Kingsmill and a “significantly better year” for Jordans Ryvita”. Grocery profits grew by a fifth to £229m.
Hailing what an “exceptional year” for Primark, ABF said profits for its retail business surged from £252m to £341m.
Group revenues rose 10% to £10.2bn, while pre-tax profits grew by 26% to £825m.
“This year’s outstanding results represent a step-change for the group,” said ABF chief executive George Weston.
“A number of major projects will be completed over the coming year that will underpin future profit delivery and provide a platform for further growth. Opportunities for further attractive investment are plentiful and the group has the financial capacity to exploit them.”
But chairman Charles Sinclair said the group was cautious about how planned VAT rises in Europe would hit consumer spending.
“We have also seen significant increases in some commodity prices, particularly cotton and wheat,” Sinclair warned.
Associated British Foods hails ‘very good progress’ (13 September 2010)
Kingsmill and Primark buoy sales at Associated (8 July 2010)