Economy

Associated British Foods Announces Improved Full Year Outlook

Associated British Foods Announces Improved Full Year Outlook”

It performed particularly well in the United Kingdom where full-year sales were expected to be 10% ahead of last year and market share gains were achieved.

AB Foods said its adjusted operating profit would be "well ahead of last year", after Primark enjoyed good trading in the run-up to Easter.

It's due to publish a final full-year earnings report on 7 November.

LONDON-Associated British Foods PLC (ABF.LN) expects good underlying growth in fiscal 2017 as a result of a stronger profit performance from its fast-fashion chain Primark, with an added currency boost from the Brexit-weakened pound. On the same comparable basis but at actual exchange rates, sales are expected to be 20 percent ahead. "Adjusted operating profit for the group will be well ahead of previous year".

AB Foods expects full-year sales at Primark to rise 13 per cent on a constant currency basis, with the United Kingdom seeing particularly strong turnover growth of 10 per cent.

The retailer said that strong Easter trading helped drive sales, which meant less discounting. France, Germany and the United Kingdom will see the most space added and overall Primark will open 19 new stores together with a number of relocations and extensions. The larger stores will be in Stuttgart and Munich in Germany; Toulouse and Bordeaux in France; and Antwerp in Belgium. It added that favourable weather in the fourth quarter and the strength of its consumer offering resulted in markdowns at lower levels than normal and early trading of the new autumn / winter range has been encouraging.

Primark did very well in the United Kingdom, where sales are expected to be 10% ahead on a year ago on a comparable basis and its share of the clothing market has increased significantly.

It said that because of this, the devaluation will result in a translation benefit of some £85m this financial year, most of which materialised during the first three quarters.

No financial details of the transaction were revealed, by the group said, in the year ended 31 December 2016, the Acetum business generated net sales of €103mln.



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