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Associated British Foods PLC on Tuesday reported ‘very good’ retail footfall and a better-than-expected margin at fast-fashion shop chain Primark in the 24 weeks that ended March 4. During the half-year, the London-based food producer and clothing retailer said pretax profit edged up by 1.4% to £644 million from £635 million the year prior, though basic earnings per share rose by 11% to 67.0 pence from 60.3p, helped by an overseas tax credit. Revenue from continuing operations jumped 21% to £9.56 billion from £7.88 billion. Chief Executive George Weston said the period was marked by ‘extreme and volatile’ inflation in all its business. He noted the company has taken ‘considerable’ action to mitigate these costs, through operational cost savings and pricing to customers. At Primark, sales were up 19% to £4.23 billion, reflecting ‘good growth in all countries’. Westson added: ‘The performance of our Food businesses was resilient in aggregate, underpinned by an exceptional performance at Ingredients. We were very pleased with the improvement in Primark sales, which recovered strongly from the second half of the last financial year and drove operating profit margin up to 8.3%, higher than we had expected.’ Revenue in Food was £5.33 billion, up 23% from £4.34 billion a year before. Within this, Grocery revenue rose by 16% to £2.11 billion from £1.82 billion, Sugar revenue by 30% to £1.19 billion from £914 million, and Ingredients revenue by 36% to £1.09 billion from £798 million. Brands in its Grocery division include Allinson’s flour, the Blue Dragon range of Asian food products, and Kingsmill bread. AB Foods declared a dividend of 14.2 pence per share, up 2.9% from 13.8p a year prior. Looking forward, AB Foods said the continued recovery from customers of its rising input costs remains a ‘priority’. For the full-year, the company continues to expect adjusted operating profit and adjusted earnings per share to be ‘broadly’ in line with the year prior. For financial 2022, adjusted operating profit was £756 million, and adjusted EPS was 131.1p. Shares were down 5.5% at 1,956.50 pence each on Tuesday morning in London. Copyright 2023 Alliance News Ltd. All Rights Reserved.
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