AB Foods results beat forecasts

AB Foods reported adjusted pre-tax profit of £1.096bn for the financial year to September 14, on revenues up nine per cent to £13.3bn, beating average analyst expectations. Adjusted earnings per share (EPS) rose 13 per cent to 98.9p.

Primark, which has more than 250 stores in Britain and Europe and generates almost a third of group sales, has performed strongly through the economic downturn thanks to its low prices and quick adoption of fashion trends.

Its adjusted operating profit rose 44 per cent to £514m on revenue up 22 per cent to £4.2bn as it added 10 per cent store space.

AB Foods said it expected Primark’s continued growth, as well as the expansion in its grocery business, to boost profits in those divisions next year, although it forecast a further fall in profit from its AB Sugar business as European sugar prices drop.

Overall, the group confirmed it expects adjusted EPS for the coming year to be similar to 2013.

Sugar prices have been under pressure due to expectations of a fourth year of oversupply in the 2013/14 season, with benchmark sugar falling to three-year lows in July.

“Looking ahead to the next few years we see excellent prospects for Primark and further margin recovery in grocery,” Chief executive George Weston said in a statement.

British retail sales grew slightly more strongly in October compared to the previous month, but lower clothing sales due to mild weather limited overall gains, the British Retail Consortium said today