4th Jul 2006 10:30
Associated British Foods PLC04 July 2006 Associated British Foods plc Associated British Foods announces further plans for the development of British Sugar For immediate release 4 July 2006 Associated British Foods plc ("ABF"), the international food, ingredients andretail group has today announced further plans for the development of BritishSugar. It is proposing to close its York and Allscott beet sugar factories after theend of the 2006/7 campaign and consolidate processing at its remaining fourfactories in the UK. In addition, it has confirmed its intention to purchasethe 83,000 tonnes of additional sugar quota available in the UK as a result ofreform of the EU sugar regime. These developments follow the consolidation of British Sugar's Polish operationsinto two factories last year and the application to acquire 11,000 tonnes ofadditional sugar quota available in Poland. Together these will reinforceBritish Sugar's position as the lowest cost processor in the EU beet sugarindustry. An exceptional charge of around £93 million will be made in the consolidatedincome statement for the year ending to September 2006 comprising £66 million ofasset write-down and £27 million of estimated cash costs associated with thereorganisation. These costs will be excluded from the calculation of adjustedearnings. The investment in additional quota in the UK and Poland is expectedto cost £47 million dependent on exchange rates and success in securing thetargeted volumes. This cost will be capitalised and amortised over nine years. George Weston, Chief Executive of Associated British Foods, said, "We intend ultimately to produce more sugar from four UK factories than wecurrently produce from six. This development, together with the recentlyannounced collaboration with BP and DuPont to build the UK's first commercialbiobutanol plant and the proposed acquisition of a controlling interest inIllovo Sugar Limited, the largest cane sugar producer in Africa, represent asignificant investment in the future of the group's sugar operations." For further information please contact: Associated British Foods John Bason, Finance Director Tel: +44 (0)20 7399 6500Geoff Lancaster Tel: +44 (0)7860 562659 Citigate Dewe Rogerson Tel: +44 (0)20 7638 9571Jonathan Clare / Chris Barrie / Sara Batchelor Notes to Editors Associated British Foods is a diversified, international food, ingredients andretail group with sales of £5.6 billion and over 42,000 employees in 41countries. The group is one of Europe's largest food companies and hassignificant businesses in Australia, China and the US. It is the largestpurchaser of agricultural products, including grain and sugar beet, and theleading supplier of animal feeds in the UK. British Sugar is the UK's leading supplier of sugar products to the foodmanufacturing and consumer markets. It is recognised as the most efficientsugar producer in Europe and has considerable expertise in asset utilisation,energy efficiency and process technology. British Sugar has operations inPoland and China with considerable experience in operating in developingcountries and in joint venture operations. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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