AB Foods says Primark sales hit by poor May weather
By Frank Prenesti
Date: Thursday 04 Jul 2019
(Sharecast News) - Associated British Foods said group revenue rose 3% for the 40 weeks to June 22 at constant currency rates as it maintained its full year outlook, although unseasonable May weather held back sales at its Primark fashion chain.
The company said it expected good full year profit growth in Primark and, on an underlying basis, in its grocery operations.
"We continue to expect that the full year profit decline in sugar has been reflected in the first half. Our full year outlook for the group is unchanged, with adjusted earnings per share expected to be in line with last year," the company said in a trading statement.
Sales at Primark were 4% ahead of last year on a constant currency basis driven by increased selling space partially offset by a decline in like-for-like sales.
In the UK sales growth continued in the third quarter as Primark recorded a further significant increase in market share.
Sales in the Eurozone were also hit by the unseasonable weather in May but trading recovered strongly in June. Sales growth was delivered in Spain, Portugal, France and Italy while trading continued to be weak in Germany, ABF said.
The sugar business was recovering after being hit by weak pricing. AB Foods said it expected further stabilisation through the end of the year.
"Early indications are that EU sugar production for 2019/20 will remain at this lower level following a reduction in the crop area. As a consequence, stocks are forecast to remain low which should underpin the higher spot EU sugar prices following their recovery earlier this year," the company said.
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