Associated British Foods (ABF) CEO George Weston has expressed pride in the company’s pandemic response, describing the latest financial results as ‘exceptional’.
The grocery arm of the organisation reported revenue of £1,834m in the 24 weeks ending 27 February 2021, representing a year-on-year rise of 9%. Adjusted operating profit for grocery during the same period was £199m, up 5% on the previous year.
Revenue in Allied Bakeries was in line with 2020, ABF said. Following the Kingsmill owner’s decision last year to exit its Co-op contract, cost reductions have been delivered to mitigate the loss in contribution, it added.
“I am proud of how our people have responded to the many challenges presented by Covid-19,” said Weston. “Our food businesses delivered an exceptional increase in adjusted operating profit of 30% and we have provided safe and nutritious food under the most demanding of conditions.”
ABF’s interim results also state that its ingredients business AB Mauri experienced ‘increased demand’ for yeast and bakery ingredients, while ABF Ingredients saw further growth partly due to ‘good progress in yeast extracts’.
In addition, the report highlighted ABF’s recent opening of its Global Technology Centre in the Netherlands. “This provides an upgraded international hub for the research and development of bakery solutions, as well as accommodating a pilot plant, laboratories and training facilities,” it said.
“Following the exceptional performance of our grocery, sugar, agriculture and ingredients businesses in the first half, we expect a softer performance in the second half,” Weston added.
“Grocery volumes are expected to be softer in the second half compared to the very strong retail channel sales experienced last year at this time and margins will be impacted by significantly higher US commodity vegetable oil costs.”
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