Associated British Foods plc British Foods plc Business Highlights Benefit from last year’s substantial investment in capital and acquisitions Progress achieved despite £28m impact

Associated British Foods plc


Review of interim results for 24 weeks ended 3 March 2007

24 April 2007


Financial Highlights

§ Adjusted operating profit up 7% to £272m *

§ Group revenue up 12% to £3,220m

§ Adjusted profit before tax up 5% to £268m **

§ Adjusted earnings per share level at 23.3p **

§ Interim dividend per share up 4% to 6.5p

§ Net investment in capital and acquisitions over the last year of £720m

§ Net debt of £350m

§ Basic earnings per share down 9% to 19.2p and profit before tax down 15% to £198m

* before amortisation of intangibles and profits less losses on the sale of property, plant & equipment ** before amortisation of intangibles, profits less losses on the sale of property, plant & equipment and losses on the sale of businesses All figures stated after amortisation of intangibles, profits or losses on the sale of businesses and property, plant & equipment are shown on the face of the consolidated income statement.


Business Highlights

§ Benefit from last year’s substantial investment in capital and acquisitions

§ Progress achieved despite £28m impact from EU sugar regime change

§ Transformation of sugar business underway

– strong Illovo contribution

– excellent performances in UK, Poland and China

– UK bioethanol plant commissioning June 2007

§ Good progress from Ingredients and Grocery businesses except Allied Bakeries

– Kingsmill now relaunched

§ Primark profit up 28%

– 23 stores opened

– strong likeforlike growth


12 Profits less losses on sale of property, plant & equipment

12 Profits less losses on sale of property, plant & equipment

2007

(16) (43) Amortisation of intangibles

+7% 255 272 Adjusted operating profit

239 241 Operating profit

3 3 Share of joint ventures and associates

(2,651) (2,994) Operating costs

+12% 2,887 3,220 Revenue

Change 2006 £m

Income Statement


Income Statement

+5% 255 268 Adjusted profit before tax*

168 155 Profit after tax

(66) (43) Tax

15% 234 198 Profit before tax

(73) (75) Financial expenses

73 71 Financial income

(5) (39) Losses on sale of businesses

+1% 239 241 Operating profit

Change 2006 2007 £m

* before amortisation of intangibles, profits less losses on the sale of P, P & E and businesses


Tax

(16) Credit for losses on sale of businesses and property, plant & equipment

66

(3)

69

£m

2006

£m

43

(13)

72

2007

28.2% 21.7% Reported charge

Credit on intangible amortisation

27.1% 26.9% Underlying charge


Earnings and Dividend Per Share

+4% 6.25p 6.50p Dividend per share

9% 21.0p 19.2p Earnings per share

level 23.3p 23.3p Adjusted earnings per share *

Change 2006 2007

* before amortisation of intangibles, profits less losses on the sale of P, P & E and businesses


Balance Sheet

(173) (320) Deferred tax

75 152 Net pension asset

3,983

28

3,955

3,983

(49)

(162)

(99)

815

2,337

1,239

2006

4,184

208 Minority interests

3,976 Equity shareholders’ funds

4,184

(68) Provisions

(350) Net debt

(71) Current tax

728 Working capital

2,659 Property, plant & equipment and other noncurrent asset investments

1,454 Intangible assets (including goodwill)

2007 £m


Cash Flow

(45) (18) Provisions

70 (4) Sale of Littlewoods stores

3 (14) Pension cost less contributions

16 43 Intangible amortisation

(100) (113) Food

(362) (42)

(100) 59 Acquisitions less disposals

(95) (99) Dividends paid

(237) 2 Free cash flow

9 10 Other

(3) (17) Net interest

(69) (48) Tax

(56) (114) Capital expenditure Primark

(323) (62) Working capital

95 109 Depreciation

236 226 Operating profit (before joint ventures and associates)

2006 2007 £m


N/A

16 141 Littlewoods

(11) (13) Central costs

Profit Revenue

71 91 530 721 Retail Primark

61 94 578 901 Primary food & agriculture

84 64 1,257 1,226 Grocery

32 33 322 345 Ingredients

255 272 2,887 3,220

2 3 59 27 Businesses disposed

253 269 2,828 3,193 Continuing businesses

£m £m £m £m

2006 2007 2006 2007

By business

Segmental Analysis

Margin ROCE

2007 2007 2006 2006

8.9 8.4

8.4 8.8

% %

6.7

10.6

9.9

13.4

%

5.2

10.4

9.6

12.6

%

(annualised)

N/A

19.3 17.8

20.5

17.5

20.4

27.5

15.8

21.5

20.6

17.4

11.3 N/A


8.8

N/A

8.9

5.5

10.1

12.6

9.0

%

2006

8.4

N/A

8.4

6.6

10.7

10.1

7.6

%

2007

Margin

255 272 2,887 3,220

2 3 59 27 Businesses disposed

253 269 2,828 3,193 Continuing businesses

27 35 491 532 Asia Pacific

58 58 576 544 The Americas

35 62 277 614 Europe, Middle East & Africa

133 114 1,484 1,503 United Kingdom

£m £m £m £m

2006 2007 2006 2007

Profit Revenue

By geography

Segmental Analysis


European Sugar

UK • £24m impact of regime change • sugar prices more stable • lower energy costs, efficient campaign, earlier exports • additional quota acquired • 1.16m tonne crop

Poland • excellent campaign • factories rationalised • Glinojeck performed well

+64% +105% Change

53 87 Operating Profit £m

282 579 Revenue £m 2007 2006 Primary food


China

• record crop

• high sugar yield, satisfactory prices

+64% +105% Change



Illovo

• earnings for year to 31 March 2007 up over 40%

• better pricing, strong performances in Malawi, Zambia

• crop lower in South Africa, Tanzania

• exciting growth potential

– Swaziland expansion

– £100m investment in Zambia to double production


• UK’s first bioethanol plant to be commissioned June 2007

• developing plans for larger cereal based biofuel plant in UK

+64% +105% Change




Effects of reform on European sugar industry

• EU reduction target of 5m tonnes

• some industries will shrink or close down

• those remaining will become more efficient

– increase productivity

– reduce costs, factory closures

• change facilitated by restructuring scheme

• increased EU trade flows from surplus to deficit areas

– change in competitor behaviour

• increased imports from LDCs


Sugar regime transition

• restructuring scheme will not deliver required reduction in production

• shortfall expected to be some 2m tonnes

• led to uncertainty for transition years 20072009

• European Commission intention to manage shortterm supply/demand balance

• first stage announced January 2007

– 2m tonne cut for beet industry across EU

– beet plantings were reduced this Spring

– further cut in October if necessary


Sugar regime transition

• European Commission now developing proposals for medium term

• enhance restructuring scheme

• timetable for agreement to proposals

– publication May

– debate May – September

– final agreement October

• resolution should remove uncertainty


13% +9%

Change


296 322 Revenue £m 2007 2006 Agriculture

AB Agri

UK animal feeds • volumes and margins ahead

Frontier • strong revenue growth and cost synergies

China animal feeds • cyclical industry • slow restocking of livestock • higher raw material costs not recovered


24% 2%

Change


1,257 1,226 Revenue £m 2007 2006 Grocery

ACH

• Mazola sales increase

• herbs and spices

– growth of Spice Islands

– launch of new Weber range

• rationalisation of commodity oils business

• further growth for Capullo


Ryvita

• growth in Minis and premium crispbread

• decline in standard crispbread

24% 2%

Change



Silver Spoon

• Billington’s ahead with Illovo sourced Fairtrade sugar

• impact of price reduction last year

Westmill

• successful integration of businesses


Twinings/Ovaltine

• UK and export sales strong for Twinings

• further Ovaltine growth

• sale of Scandinavian food distributor

24% 2%

Change



George Weston Foods

• strong recovery of bread business

– prices and volumes ahead

– Sydney bakery operating well


Allied Bakeries

• disappointing performance in first half

– lower volumes

– increased wheat costs not recovered

• major relaunch of Kingsmill on 19 February

– new recipes, larger loaves and softer texture

– new packaging

– subbrands under Kingsmill

24% 2%

Change



– heavy marketing support

– price increase


Volume share of plant bread by brand within total coverage

19.6 21.1

24.0 23.8

WE 25.03.06

WE 08.04.06

WE 22.04.06

WE 06.05.06

WE 20.05.06

WE 03.06.06

WE 17.06.06

WE 01.07.06

WE 15.07.06

WE 29.07.06

WE 12.08.06

WE 26.08.06

WE 09.09.06

WE 23.09.06

WE 07.10.06

WE 21.10.06

WE 04.11.06

WE 18.11.06

WE 02.12.06

WE 16.12.06

WE 30.12.06

WE 13.01.07

WE 27.01.07

WE 10.02.07

WE 24.02.07

WE 10.03.07

WE 24.03.07

% Volum

e Sh

are

19.6 21.1

24.0 23.8

0

5

10

15

20

25

30

% Volum

e Sh

are

week ending

Kingsmill Hovis Warburtons Own label

Source: Nielsen EPOS Data


+3% +7%

Change


322 345 Revenue £m 2007 2006 Ingredients

AB Mauri

• yeast price increases recover higher input costs

• recovery in North America

• further capacity expansion

ABF Ingredients

• strong growth across all businesses

• enzyme sales well ahead

• higher protein volumes and pricing

• US commodity food polyols business sold

Profit up 9% adjusted for adverse currency translation


+28%

+36%

Change

16 Littlewoods 71 91 Primark

Operating Profit £m

2006 2007 Retail

141 Littlewoods 530 721 Primark

Revenue £m

Primark

A period of intense activity

• 23 stores opened – on time, on budget

• new UK distribution centre fully operational

• second Spanish store opened

• strong likeforlike sales

– level with last year

– up 6% for stores unaffected by new openings


Primark store trading

§ trading in new stores encouraging

§ opportunity now to optimise performance

§ customers travelled over long distances

– Coventry, Cheltenham openings affected Birmingham

§ incremental business created

Newcastle likeforlikes improved during half year

+59% 13.8 21.9 76

9.3 34 Gateshead Metro

9% 13.8 12.6 42 Newcastle

£m £m

2006 2007 Sq ft ‘000

Sales first half


Primark selling space expansion

+53% +14% +64%

161 4,430 2 50 36 830 123 3,550 February 2007

126 2,890 35 730 91 2,160 February 2006

stores sq ft ‘000

stores sq ft ‘000

stores sq ft ‘000

stores sq ft ‘000

Total Spain Republic of Ireland UK


2007

Now…

Primark Oxford Street

2000

Then…


Summary

§ Benefit from last year’s substantial investment in capital and acquisitions

§ Progress achieved despite £28m impact from EU sugar regime change

§ Transformation of sugar business underway

– strong Illovo contribution

– excellent performances in UK, Poland and China

– UK bioethanol plant commissioning June 2007

§ Good progress from Ingredients and Grocery businesses except Allied Bakeries

– Kingsmill now relaunched

§ Primark profit up 28%

– 23 stores opened

– strong likeforlike growth



Review of interim results for 24 weeks ended 3 March 2007

24 April 2007


This presentation pack is directed only at investment professionals falling within article 19 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 and to other persons to

whom the presentation pack may lawfully be promoted.

Documents

Associated British Foods plc British Foods plc Business Highlights Benefit from last year’s substantial investment in capital and acquisitions Progress achieved despite £28m impact