Primark’s strong performance is set to be the talk of Associated British Foods PLC (LSE:ABF)’s full-year update on Tuesday, 7 November.
Expectations are that the fashion retailer will pen like-for-like sales growth at roughly 9% to £9 billion for the year, as laid out by ABF itself last month.
Falling energy, freight and material costs are also expected to have aided margins, which are tipped to come in around 8% for the year.
“The key Primark business has benefitted from a changing retail landscape over the past few years, especially with the demise of Debenhams and Topshop,” Hargreaves Lansdown analyst Aarin Chiekrie explained.
Price hikes have also helped, Chiekrie said, alongside the opening of new Primark stores.
Though specific guidance for the retailer’s upcoming year seems all that’s left to be keenly awaited, questions around ABF’s other business could still be asked.
Given poor weather last year hit production and profitability at its sugar business, the subsequent recovery could provide some interesting insight, according to Chiekrie.
“Investors are keen to hear how much progress has been made to date, and what the group’s outlook is for the new financial year,” he said.
ABF has indeed already hinted to a strong uptick in profit from 2022’s £162 million, though by how much remains to be seen.