Associated British Foods has said trading at its Primark fashion chain was challenging in November, though sales and profit for the group as a whole over the first eight weeks of its 2018-19 year were in line with expectations.
Ahead of its annual shareholders' meeting on Friday it said that with careful inventory management and improved margins, its expectation for an increase in Primark's profit was unchanged.
“At this early stage in our new financial year, sales and profit for the first 8 weeks of trading for the group were in line with expectations,” commented chairman Michael McLintock.
“However, during November Primark trading was challenging, in a tough retail market, but with careful inventory management and improved margins, our expectation for the increase in Primark profit is unchanged.”
Maintained Guidance
AB Foods, which also has sugar, grocery, agriculture and ingredients divisions, also maintained the overall guidance it issued last month - for adjusted earnings per share for 2018-19 in line with its 2017-18 outcome.
“In Grocery we expect an improvement in profit from a margin increase in our Australian and UK businesses and a full year contribution from Acetum,” McLintock added. “The profit at AB Sugar will be significantly lower reflecting the full year effect of EU sugar prices.
“At current exchange rates we expect no material translation or transactional effect on profit but the sterling exchange rate can be expected to be volatile given a period of intense Brexit negotiations.”
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