Associated British Foods PLC (LSE:ABF) full-year results Tuesday will be a mix of cost-of-living issues and soaring expenses balanced by a positive outlook statement and capital allocation, according to Shore Capital.
Primark’s business model has meant avoiding raising prices where possible but whether it can continue with this policy given rampant price rises across Europe remains to be seen.
The broker expects underlying profits at £1.35bn, adding the “future trajectory of the ABF share price will not be what is in the rear-view mirror” but how the company executes capital distribution and how Primark’s “buying capabilities, aggregate demand and so volume/margin expectations” will be affected as inflation ideally is reduced.