Food, ingredients and retail group Associated British Foods plc (ABF), which owns Primark, has upgraded its full-year outlook after stronger than expected sales growth in the first half.
ABF said that while it continues to face significant cost pressures, consumer spending has “proven to be more resilient” than anticipated at the start of the financial year.
The company now expects total sales for the six months to 4 March 2023 to be more than 20% ahead of last year at actual exchange rates and more than 16% ahead at constant currency. Adjusted operating profit is expected to be broadly in line with the same period last year.
For the full year, ABF now expects adjusted operating profit and adjusted earnings per share to be broadly in line with the previous financial year.
“Trading at Primark has been good in all its markets, well ahead of expectations, and represents a material improvement in both the UK and Europe on the second half of our last financial year,” ABF said in a stock exchange announcement.
It added: “Looking ahead to the second half, we remain cautious about the resilience of consumer discretionary spending in the face of continuing inflation in the cost of living and higher interest rates.
“Our expectation is that like-for-like sales growth in the second half will be lower than that achieved in the first half but, based on our experience to date, will be better than our previous expectation.”
