Associated British Foods FY09 Pre-tax Profit Declines

11/3/2009 4:02 AM ET

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(RTTNews) - Associated British Foods Plc (ABF.L: News ) said Tuesday that its pre-tax profit for fiscal 2009 declined from last year, owing to a loss related to closure of businesses. Adjusted profit before taxation grew from last year, helped a 12% rise in revenues. Looking ahead, the company said that although the speed of economic recovery remains uncertain, it expects good revenue and operating profit growth next year.

Announcing the annual results for the year ended September 12, 2009, the UK-based company said profit before taxation declined to GBP 495 million from GBP 527 million in the previous year. In 2009, pre-tax profit included a GBP 65 million loss on the closure of businesses, principally the rationalisation of the company's US packaged oil business, while the previous year recorded a GBP 5 million gain on business closure. Adjusted pre-tax profit was GBP 655 million, compared to GBP 632 million last year.

Profit for the year attributable to equity shareholders of parent rose to GBP 359 million from GBP 357 million a year ago, as profit attributable to minority interests declined to GBP 24 million in 2009 from GBP 34 million in 2008. Earnings per share were 45.5 pence, up from last year's 45.2 pence. Adjusted earnings were GBP 455 million or 57.7 pence per share.

Revenue for the year was GBP 9.255 billion, up from GBP 8.235 billion in the prior year. The company, which owns Primark clothing retail group, noted that the weakness of sterling had a favorable currency translation effect on the results, with over 50% of the group's revenue and profit arising outside the U.K. Adjusted operating profit increased by 8% in 2009 to GBP 720 million from GBP 664 million.

The company operates through four business segments: Sugar & Agriculture, Retail, Grocery and Ingredients. The Grocery business generated revenues of GBP 3.188 billion in 2009, up from last year's GBP 2.820 billion. Adjusted operating profit edged down to GBP 191 million from GBP 194 million, as a result of the first half problems of ACH in the U.S. and a highly competitive UK retail sugar market for Silver Spoon.

The Retail segment contributed GBP 2.314 billion to total revenues in 2009, higher than GBP 1.933 billion reported in the previous year. Adjusted operating profit increased to GBP 252 million from GBP 233 million. The company noted that at Primark, sales increased by 20% as a result of growth in selling space and like-for-like sales growth of 7%.

In the Sugar business, annual revenues increased to GBP 1.575 billion from GBP 1.267 billion in the prior year. Adjusted operating profit rose to GBP 189 million from GBP 153 million.