Interim results from Associated British Foods (ABF) reveal lower revenues and profitability for its Agriculture and Sugar divisions in line with reduced overall Group figures for the period.
The Agriculture division, trading as AB Agri, made an operating profit of £6 million on sales of £757m in the 24 weeks ended February 28th, compared to £7m and £891m in H1 2025.
The division’s sales declined 7%, reflecting lower monogastric compound feed volumes after the loss of a large customer. The company says it is adjusting its feed cost base accordingly. However, the speciality feed and feed additives businesses within AB Agri delivered strong growth – particularly for Premier Nutrition in the UK and AB Vista, the international feed additives business, which saw good growth in both enzyme and non-enzyme products.
AB Agri received a lower profit contribution from its joint venture arable marketing company with Cargill, Frontier Agriculture, in line with unfavourable market conditions and the effect of the small UK 2025 harvest on its grain trading activities.
Looking ahead, the Group expects Agriculture’s 2026 full year adjusted operating profit to be below that of 2025.
ABF’s AB Sugar division recorded an operating loss of £39m on revenues of £971m in the first half, compared to an operating loss of £122m and sales of £1.03 billion in the prior H1. The overall sales decline of 9% and operating loss – although reduced – are attributed to low European sugar prices.
British Sugar saw revenues and profit decline significantly over the first half, with average selling prices lower than in the prior H1 and reductions in export sales and the value of sugar stocks. But the company says losses could have been higher had it not negotiated a reduction in farmgate sugar beet prices for the 2025/26 campaign.
The 2025/26 UK beet crop is now fully processed, with approximately 1.0 million tonnes of sugar produced – a lower volume than in the previous year and in line with the smaller crop area, as intended. AB Sugar’s Spanish and African activities also saw reduced revenues and profitability.
The Group anticipates a full year 2026 operating loss for the division. While it is early to predict the size of the 2026/27 beet crop in Europe, it expects the European sugar market to remain in surplus through 2027.
The ABF Group made a first half operating profit of £657m on revenues of £9.47bn, from the £710m and £9.51bn at the same stage of the previous year. Following the in-depth review of the Group structure first announced six months ago, the ABF board has decided to demerge its Primark retail business, built up over the last 25 years, from its food activities which are collectively referred to as FoodCo.
“We knew the first half of this financial year was going to be challenging and that’s borne out in our financial results,” comments ABF chief executive George Weston. “However, we still expect improved Group performance in the second half.
“Our Grocery and Ingredients businesses performed as we had expected them to, with our US businesses impacted by weak consumer demand. Our international Grocery brands delivered good sales growth and are positioned for a stronger profit performance in the second half. In Sugar, the results were below our expectations and given the current market conditions, we are more cautious on the outlook.
“We are managing the impacts of the Middle East conflict. Given what we know today, we expect the cost consequences in 2026 to be manageable. Our strong balance sheet underpins the Group’s resilience.”