Associated British Foods says its group revenues for the 40 weeks ended 18 June was 3% more than last year
Associated British Foods expects profit growth to slow in the second half of the year due to the strong US dollar Reuters

Associated British Foods (ABF), the owner of Primark, has reported strong growth in interim profits, driven by a recovery in its sugar business.

Adjusted profit before tax jumped 35% from a year earlier to ($801m) for the six months ended 4 March.

Revenue in the half-year period improved 19% to £7.3bn.

ABF chairman Charles Sinclair credited a rise in sugar prices for the surge in profits and added that the weakness in the pound had accounted for £51m of the £171m increase in the company's operating profit.

"Our sugar businesses were the largest single driver of the group's underlying profit improvement in the first half," he said in a statement.

"Higher sugar prices and further significant savings generated by performance improvement both contributed to this and to a more acceptable return on investment."

Primark saw its revenue rising 12% year-on-year in constant currency terms, driven by the opening of 16 new stores across eight countries.

Sinclair also credited "substantial increases" in profits from the grocery and ingredients businesses to the firm's overall strong showing during the interim period.

However, ABF warned profit growth in the second half of the year would be slower due to the strength of the US dollar raising Primark's input costs.

Its board declared an interim dividend of 11.35p per share, a 10% increase on the previous year.

The company's share price opened 2.6% higher in London after the release of the earnings report.