22nd Feb 2016 07:21
LONDON (Alliance News) - Associated British Foods PLC on Monday said the underlying trading outlook for the business remains unchanged for the first half of its financial year, with some progress in adjusted operating profit to be made.
The FTSE 100-listed group, which owns discount fashion retailer Primark, as well as British Sugar, along with agriculture and consumer goods businesses, said the weakening of sterling in recent weeks, particularly against the euro, means that foreign exchange will hit its results by just GBP10 million for the half year ending February 27, having previously estimated a GBP25 million hit.
AB Foods said revenue and profit in the grocery business are expected to be similar to the first half of the prior year at constant currency, but revenue will be slightly lower at actual exchange rates.
AB Sugar, meanwhile, "performed steadily" as world sugar prices remain low but a tightening of EU and Chinese stock levels resulted in a strengthening of domestic prices in those markets.
In agriculture, revenue will be lower than last year, particularly in the UK feed business, while revenue in the ingredients business will be ahead of last year at constant currency but slightly lower at actual exchange rates. Operating profit for ingredients will be "well ahead" of last year, the company said.
Retail will once again be the strongest performer, with sales at Primark expected to be 7.5% ahead of last year at constant currency, and up 4% at actual exchange rates, driven by increased retail selling space.
AB Foods will release its first-half results on April 19.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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