AB Foods hails fresh growth at Primark

Marion Dakers

ASSOCIATED British Foods today posted a nine per cent jump in sales for the 40 weeks to 22 June as expansion at Primark, its budget fashion chain, made up for slower sugar and grocery sales.

Group revenues growth slowed in the last four months to eight per cent, though the firm said in an interim management statement that trading is in line with expectations.

At Primark, which opened its second Oxford Street shop last September, sales rose 22 per cent in the 40-week period.

The retailer aims to ramp up its new store launches in the new financial year, including its first outlet in France.

The grocery arm, which includes Twinings Ovaltine and Allied Bakeries among its businesses, posted a three per cent increase in revenues, rising to seven per cent in the last 16 weeks.

Sugar revenues fell 15 per cent in the 16-week period, which the firm put down to the timing of shipments from Zambia and the cold weather in Britain delaying planting. Revenues rose one per cent over 40 weeks, AB Foods added.

Analysts at Panmure Gordon upgraded the FTSE 100 group this morning from “hold” to “buy”, predicting another year of double-digit growth in earnings per share.

The firm will post full-year results in November.