Associated British Foods (ABF) has reported a 20 percent rise in full-year earnings, while the company’s annual profits surged.

Adjusted operating profit rose 22 percent to £1.36bn in the year to September 16, with group revenues up 15 percent to £15.4bn.

The company, whose brands include Twinings and Kingsmill bread saw strong growth at its Primark clothing chain and a recovery in its sugar businesses.

Primark sales were up 10 percent from last year.

While ABF said Primark was likely to see further “significant growth”, the company was less optimistic about its sugar unit AB Sugar.

ABF’s chief Executive George Weston told Reuters that higher volumes of sugar and lower costs in 2017-18 would not be sufficient to offset the effect of much lower EU prices.

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By GlobalData

We expect the profits of sugar to come down in the current year.

Weston’s warning sent the company company’s shares down 3.5 percent in morning trade.

AB Foods reported adjusted operating profit for sugar of £223m in 2016-17, an increase of more than fivefold on the previous year.

AB Sugar benefited from a rise in EU sugar prices and internal structural changes within the unit itself.

The impact of Brexit

The company struck an optimistic tone when commenting on the effects of Brexit on its food business.

ABFoods said it expects to see “progress” in its grocery and ingredients units, whose brands include Ovaltine, Jordans, Dorset Cereals, Patak’s and Blue Dragon.

The company said in a statement on Tuesday:

Changes in legislation and trade agreements provide significant opportunities for the food industry to replace imported food and build export markets and, for UK agricultural policy particularly, they have the potential to benefit our group.

However, ABF made cleat that it wanted further clarity on the government’s Brexit implementation period after March 2019.

In common with many other businesses, we share a concern about the risk of abrupt changes to the UK’s customs procedures. As the UK government continues its negotiations, uncertainty remains as to the extent to which our operations and financial performance will be affected in the longer term.

Over  60 percent of ABF’s sales and profits are generated outside the UK so the company benefited from the weaker value of the pound.

ABF spent £79m on business acquisitions in the past year and operates in 50 countries worldwide.