ABF posts resilient H2 as Primark gains market share, US sales surge

(Sharecast News) - Associated British Foods said on Wednesday that trading in the second half of its financial year had been resilient, with Primark gaining market share in the UK and delivering strong growth in the US, despite softer conditions in continental Europe. AB Foods said Primark's total sales growth for H2 was expected to be around 1%, with like-for-like sales down 2% year-on-year. UK and Ireland sales rose 1%, lifting market share from 6.6% to 6.8%, while US sales jumped 23%, supported by four new store openings. Sales in Spain and Portugal rose 2%, but France and Italy declined 4% amid weaker consumer demand. Central and Eastern Europe saw a 9% uplift, while Northern Europe fell 2%.

Primark's adjusted operating margin for the full year was now expected to be broadly in line with last year, though AB Foods warned that H2 margins will be lower due to phasing of one-off items. In food, grocery sales were flat, with growth in Twinings and Ovaltine offset by weaker performance in Allied Bakeries and US oils.

ABF also confirmed the closure of its Vivergo bioethanol plant and restructuring of its Spanish sugar business, with related charges of around £200m. Sugar sales were expected to fall 10%, with segment profit close to breakeven.

The FTSE 100-listed group added that it has made "substantial strategic progress" and that it now expects to benefit from recent actions and continued investment. However, ABF warned that the consumer environment remained uncertain heading into FY26.

Chief executive George Weston said: "I'm pleased with how the group has performed in the second half of our financial year in what continues to be a challenging environment, characterised by consumer caution, geopolitical uncertainty and inflation. Primark delivered improved trading in the UK and strong sales growth in the US, while trading on the continent was softer in a weaker consumer environment. In our food businesses, overall trading in the second half was in line with our expectations."









Reporting by Iain Gilbert at Sharecast.com