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Last Updated: Tuesday, 24 April 2007, 09:43 GMT 10:43 UK
ABF gets Primark and sugar lift
Primark worker
Shoppers flocked to the opening of Primark's superstore in London
Associated British Foods (ABF), which owns brands including Silver Spoon sugar, Kingsmill bread, and Primark clothing, has seen profits rise 5%.

The company said pre-tax profits climbed to 268m in the six months to 3 March, compared with 255m a year earlier. Sales climbed 12% to 3.22bn.

Helping drive earnings was the Primark clothing chain, where profits jumped 28% to 91m on new shop openings.

The company has also boosted sugar sales outside the European Union.

In previous months, ABF had seen its sugar profits crimped by changes to the European sugar industry and a reduction in the amount of subsidies paid.

Sugar accounts for about a fifth of ABF's profits, while Primark makes up about two-fifths.

Rapid growth

Primark has undergone a rapid expansion in recent months, with 23 new stores opening in the six-month period to give it a total of 161 stores.

Primark's success comes because of ABF, not in spite of it - we have no plan to float it off
George Weston, ABF chief executive

Total sales at Primark were up 36% to 721m, but like-for-like sales - which strip out the impact of store openings and closures - were flat, the company said, because of the impact of new stores opening close to old ones.

Primark said it estimated that for like-for-like sales growth in stores unaffected by new openings was 6%, adding that trading in the new stores had been "encouraging".

In April, Primark opened a large store on London's Oxford Street - an event that proved so popular that police were called to control the crowds - and the chain plans to have 170 outlets by mid-September.

Primark has also opened two stores in Spain and said it was "very encouraged" by early trading there, with four more Spanish outlets planned in the next 12 months.

Despite Primark's success, ABF chief executive George Weston said the firm had no plans to split the fashion chain off.

"Primark's success comes because of ABF, not in spite of it. We have no plan to float it off," he said.

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ABF profits dip on higher costs
07 Nov 06 |  Business
Sugar price setback for AB Foods
11 Sep 06 |  Business
Sugar costs hit Associated Foods
19 Apr 06 |  Business

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