Associated British Foods (ABF) said profits in its bakery sector were lower than last year, due to a poor performance by Allied Bakeries.

Prior to entering the close period for its interim results to 3 March 2007, ABF announced last week in its Pre-Close Period Trading Update that the competitive UK bread market "delayed the recovery of increased wheat prices last autumn and volumes were lower than expected."

However, the company is hoping the re-launch of Kingsmill will strengthen Allied’s position.

Profits from the sugar businesses were ahead of last year and yeast sales in all of AB Mauri’s markets have also increased.