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AB Foods boosted by "exceptional" Primark and sugar

Last updated: 08:01 06 Nov 2012 GMT, First published: 09:01 06 Nov 2012 GMT

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“Exceptional performances” from its sugar arm and Primark helped Associated British Foods (LON:ABF) coast past forecasts last year.

Clothing retailer Primark's sales of £3.5bn were more than double those of five years ago and 17% ahead this time last year.

UK sales were strong over the summer while new store openings helped European sales remain “buoyant”. Berlin set a new Primark record for firt day sales, i said. Like-for-like sales growth was 3% for the full year to September 15.

AB Sugar posted another record profit due to  an “excellent” UK campaign, a strong European commercial market and better sugar yields across southern Africa.

Grocery and Ingredients were weaker as competition intensified and costs rose, though AB Foods expects a recovery in the current year.

Overall, sales rose by 11% to £12.3 bln, with underlying profits 17% ahead at £974 mln, against consensus forecast of £935 mln.

Pre-tax profits were flat at £761 mln after the group took a £98 mln charge for write downs at its Australian meat business. 

Charles Sinclair, AB Foods’ chairman, said: “Global economic uncertainty looks set to remain a feature of the new financial year and in recent months we have seen an increase in some of our commodity costs, notably cereals.  

“We expect a reduction in profit from AB Sugar, as a result of lower EU production, to be more than offset by further growth at Primark and some recovery in Grocery.” 

The dividend for the year rises by 15%. Shares down 4 at 1,363p.

 

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