ANALYST VIEWS: WHAT’S THE OUTLOOK FOR AB FOODS?
DARREN SHIRLEY | SHORE CAP
We do not anticipate any material changes to group forecasts post today’s update, though given the breadth of ABF’s operations we would not be surprised if we tweak divisional forecasts post speaking to management. We commenced 2012 with ABF our preferred stock of the FTSE 100 food producers … we continue to remain positive.
MARTIN DEBOO | INVESTEC
We read this update as fairly neutral for both our and consensus forecasts. The big picture remains unchanged to our eyes: rampant sugars, resilient Primark and stuttering grocery and ingredients. Relative to our expectations, sugars looks set to surprise us positively again. Grocery looks set to disappoint, on the back of further restructuring charges.
ANDREW WOOD | SANFORD C BERNSTEIN
Grocery and ingredients appear to be struggling in the first half and, while Primark growth is good in a difficult environment, first half like-for-like growth and reported sales growth are both below expectations. Given these factors, plus the stock’s outperformance vs. the market year to date (+2 per cent) when all of its European Food peers have under-performed, we expect a somewhat subdued and slightly negative reaction to this update.