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Associated British Foods warns on profits, cuts top executives’ salaries as Primark hard hit by coronavirus pandemic

The clothing retailer has had to close all its outlets following governmental guidelines, causing an expected net £650mln in lost income per month

Associated British Foods PLC - Associated British Foods warns on profits, cuts top executives’ salaries

Associated British Foods PLC (LON:ABF) has warned that its full-year earnings will be “much lower than envisaged” at the start of the period in September as the coronavirus pandemic impacts the food producer to Primark clothing stores conglomerate.

In a statement, the FTSE 100-listed firm said it has not seen “a material impact” on its sugar, grocery, ingredients and agriculture businesses, but its fast-fashion chain Primark has been hit hard.

READ: AB Foods says Primark shutdowns will cost £650mln in sales per month

AB Foods said the clothing retailer has had to close all its outlets following governmental guidelines against the spread of the coronavirus, causing an expected net £650mln in lost income per month. Primark does not have an online shopping platform.

To save cash, the group added, chief executive George Weston, finance director John Bason and Primark boss Paul Marchant requested to cut their base salary in half, while other members of the board are also giving up fees and bonuses.

As of Thursday, the firm said it had £1.7bn in the bank.

"ABF will be here post COVID-19, it will continue to benefit from its diverse and high-quality stream of revenues, operating cash flows and earnings, it will continue to have a well-invested global infrastructure that is relevant to the future," analysts at Shore Capital said.

Shares lost 2% to 1,690.5p on Friday.

--Adds analyst's comment, shares--

Quick facts: Associated British Foods PLC

Price: 2130 GBX

LSE:ABF
Market: LSE
Market Cap: £16.85 billion
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