Associated British Food's (ABF) share price rose more than seven per cent this morning, taking it straight to the top of the FTSE 100, as the Primark owner posted a rise in revenues and hailed 2016 as a "turning point" for its sugar business.
The retailer added that it hopes to benefit from Brexit and is in discussions with the government to discuss trade policy negotiations that could boost its businesses.
Group revenue rose five per cent to £13.4bn in the 53 weeks ended 17 September, although like-for-like sales fell by two per cent overall. Adjusted operating profit rose three per cent to £1.1m, while adjusted earnings per share lifted five per cent to 106.2p.
ABF's full-year dividend rose five per cent to 36.75p.
The group invested £1bn in its businesses over the year, including bolstered spending for cut-price fashion retailer Primark and its food arms.
ABF opened a further 1.2m sq ft of Primark selling space, which is set to continue next year with an "extensive schedule" of new store openings planned for the next financial year.
ABF shares were trading 7.4 per cent higher at 2,672p at the time of writing.
Why it's interesting
ABF said today that while the EU referendum in June has created some short-term uncertainties, including the decline in the value of sterling, changes in legislation and trade agreements, particularly in the form of tariffs and agricultural policy, "have the potential to benefit the group".
It added that it is "engaging with a number of UK government departments to ensure that the full range of opportunities and risks, as they affect ABF, are recognised".
In a pre-close trading update in September, ABF said the weakened pound had resulted in a "translation benefit" between June and the end of the period, but that it may see a negative impact in the new financial year.
ABF said 2016 will be seen as a "turning point" for its British Sugar business, as an upturn in EU and world sugar prices and continued cost reduction programmes were beginning to pay off.
Read more: Currency woes lift at Primark parent ABF
In April, ABF completed a £247m purchase of Africa's largest sugar producer, Illovo Sugar Limited, which is expected to "accelerate its performance improvement and commercial development" at a time when "increasing populations and rising incomes are driving growth in the African sugar market".
What ABF said
Chief executive George Weston said:
This has been a year of progress for all of our business with a substantial expansion in Primark's selling space, increased margins in all of the food businesses and fundamental structural changes at AB Sugar. The recent decline in the value of sterling presents both benefits and challenges to the group.
The diversity of our operations and our broad geographical footprint, combined with a strong balance sheet, equip us well to take advantage of these opportunities as they arise.