Primark owner AB Foods voices fear of Brexit customs chaos as it posts 22% leap in profits
- Credit: Archant
Associated British Foods has joined the rally of calls for a Brexit transition deal as strong sales at its fashion chain Primark led to a 22% rise in profits.
Chief executive George Weston said the group, which owns East Anglia-based British Sugar, was concerned over the risk of 'abrupt changes' to customs procedures – but added that Brexit changes could help build a better British export market.
He said: 'Changes in legislation and trade agreements provide significant opportunities for the food industry to replace imported food and build export markets and, for UK agricultural policy particularly, they have the potential to benefit our group.'
His comments came as AB Foods unveiled a robust set of annual results, with underlying pre-tax profits surging by more than a fifth to £1.31bn for the year to September 16.
Its Primark business received a boost from the weak pound and further expansion, with revenues surging by 19% to £7.05bn, while UK like-for-like sales jumped 10% ahead.
The group, which also owns Twinings tea and Kingsmill bread, has taken a hit to margins from increased buying costs caused by the pound's fall since the Brexit vote and said this will continue into the first half of the current financial year.
But it said overall full-year margins would be flat on the past year and it added it expects to make further 'progress' in earnings for the year to September 2018.