International food and retail group Associated British Foods (ABF) has issued its trading update for the 16 weeks to 4th January 2025, reporting revenue declines in its UK brands.

For the 16 weeks ABF reported group revenue of £6.7 billion (£6,732,000,000), which it said was down 2.2%.

ABF said its grocery revenue grew 1%, reflecting good growth in its international brand businesses. It was partially offset by declines in certain US and UK-focused brands, which ABF said was expected.

In its regionally-focused businesses, ABF’s brands in the US performed broadly in line with expectations, which includes a negative impact from the normalisation in sales of consumer oils. Sales of its UK-focused businesses declined overall, primarily due to lower volumes and sales in Allied Bakeries.

Ingredients

Ingredients revenue grew 4%, and sales in ABF’s yeast and bakery ingredients business, AB Mauri, grew 4% led by good growth in Central and South American markets. Its speciality yeast business, AB Biotek, had an encouraging start to the year.

Sugar

Sugar sales declined 2% with good sales growth in Africa offset by a decline in European sales prices, which ABF expected.

Its African sugar business delivered sales growth across most markets. Growth was good in Zambia and Malawi, while sales in Tanzania continued to be impacted by the overhang of high levels of imports earlier in 2024.

ABF’s production in South Africa was impacted by lower cane yields due to drought. As expected, sales in the UK and Spain declined as a result of lower European sugar prices. The processing of its UK sugar beet crop is underway and early indications are that sugar production will be broadly in line with last year.

Agriculture

Agriculture revenue declined 4%. The speciality feed and additives businesses delivered good growth, and its dairy business, which was formed through a number of acquisitions in 2023, also performed well. However, sales in ABF’s compound feed businesses continued to be lower due to reduced commodity prices and continued soft demand in the UK and China.