British food group sees profits drop

23 April 1999

British food group sees profits drop

TOUGH trading conditions pushed down interim profits at Associated British Foods, whose main UK interests include British Sugar, Allied Mills and ABN animal feeds.

A good sugar beet crop – the fourth highest at 1.4m tonnes – saw British Sugars operating profits rise slightly to £74m.

Allied Bakeries had more mixed fortunes. In January, major retailers reduced the price of an economy loaf to 7p, prompting a 50% increase in demand which hit the premium loaf sector. "Neverthe-less, the Kingsmill brand increased its sales over last year and is now the single largest-selling bread brand in the UK," said executive chairman Garry Weston.

Animal feeds suffered from industry over-capacity and weak demand, but showed significant recovery from the low profit levels in the second half of 1998, he adds.

Overall, ABF increased turnover to £1.985bn, up £22m on the previous period. Operating profits slipped £4m to £146m for the period.

A special dividend of 50p a share was announced, returning £448m to shareholders.

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