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Associated British Foods, whose eclectic interests include the Primark fashion chain, has reported a ten per cent increase in annual pre-tax profits.

The food and retail group says its adjusted profit before tax climbed to £613 million in the year to September 15th, while the company's basic earnings per share lifted by 23 per cent to 46.7p over the year.

Meanwhile group revenue increased by £6.8 billion over the 12-month period.

Associated British Foods attributed the strong sales growth to recent investments and acquisitions made by the group.

The maker of Twinings teas now owns Indian cuisine brand Patak's, which it says has strengthened its grocery business. Associated British Foods claims it has created a world foods business by combining the newly acquired group with its pan-oriental foods brand Blue Dragon.

In addition the company has boosted its presence in the health foods market with the acquisition of a 20 per cent stake in the Jordans cereal group.

Associated British Foods said its results also reflected the contribution from the group's 51 per cent stake in Africa's largest cane sugar producer, Illovo, for the first time.

On the high street the company is also increasing its presence, increasing retail selling space across its discount fashion chain Primark by 37 per cent over the year and has opened a new store on London's Oxford Street.

Although Primark's like-for-like sales grew by just one per cent over the year, Associated British Foods stressed that the growth was encouraging given the impact the challenge of expanding the business had had on operations and the way this summer's unusually wet weather had hit trading.

Commenting on the results, Associated British Foods chief executive George Weston said: "This year's strong growth in revenue and operating profit reflects the recent major investment made by the group in capital expenditure and acquisitions.

"The scale and range of our sugar activities are being transformed and Primark is now the second largest clothing retailer in the UK by volume."

However Associated British Foods, which acknowledged that its Allied Bakeries business in the UK performed poorly over the year, warned that the reform of the EU sugar regime would have a further negative effect on its profits over the coming year.

The group also stressed that higher commodity costs would continue to put pressure on margins, but said it was successfully recovering some of the losses by raising prices.