Associated British Foods has forecast an improvement in second-half profits, despite continuing pressure from rising crop prices and currency swings.
ABF, which has brands include Silver Spoon sugar and Twinings tea, said it expected growth in operating profits in the six months to September 18 to be similar to the ten per cent seen in the first half.
But in a trading update, the group said pension charges would cut pre-tax profits by £15m in the current financial year.
Adverse exchange rates put heavy pressure on British Sugar, where record productivity and a good beet crop were not expected to prevent UK profits from falling.
British Sugar, which has six factories in the UK, including processing plants at Bury St Edmunds, Newark and Telford, has been hit by the weakness of the euro against sterling.
But the group said lower UK profits would be more than offset by higher crop prices in Poland, after the introduction of the EU sugar regime, and in China.
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