Associated British Foods (LON:ABF) on Wednesday reported that Primark sales in the United States grew 23% in the second half of its financial year, offsetting weaker trading in continental Europe as the company nears the close of its 2025 fiscal year.
Chief rxecutive George Weston said, “I’m pleased with how the Group has performed in the second half of our financial year in what continues to be a challenging environment, characterised by consumer caution, geopolitical uncertainty and inflation. ”
Primark’s overall sales growth for the year is expected to be about 1%, with like-for-like sales in the second half projected to fall 2% from last year, including a 2.4% decline in the third quarter and an estimated 2% decline in the fourth quarter.
Weston said, “Primark delivered improved trading in the UK and strong sales growth in the US, while trading on the continent was softer in a weaker consumer environment.”
The company opened four U.S. stores in the second half, including its first location in Tennessee. Weston said the U.S. rollout shows that Primark’s “value proposition resonated with customers.”
In the United Kingdom and Ireland, Primark sales are forecast to rise about 1% in the second half, with clothing market share climbing to 6.8% from 6.6% a year earlier, according to Kantar.
Excluding changes to its store estate, like-for-like sales are expected to be nearly flat. Strong womenswear demand, Easter trading and the expansion of Click and Collect services across all 187 U.K. stores supported results.
In continental Europe, Spain and Portugal are expected to grow 2% in the second half, while France and Italy are projected to decline 4%. Central and Eastern Europe is set to increase 9%, supported by new stores, while Northern Europe, including Germany, the Netherlands, Belgium and Austria, is expected to decline 2%.
Primark expanded with 15 new stores in the second half, including sites in Spain, Portugal, France, Italy, Romania, the U.K. and the U.S. Twenty-two stores were refitted, while one was closed and another downsized in the Netherlands.
Preparations are under way for its first stores in the Middle East, with one set to open in Kuwait in October and two in Dubai in early 2026.
In grocery, sales were in line with last year. Twinings recorded volume-led growth, Ovaltine expanded through higher prices and new products, and Allied Bakeries posted lower sales and an operating loss.
ABF agreed to acquire Hovis Group Limited, subject to regulatory approval, in a deal Weston said would “create a financially sustainable UK bakeries business.”
Ingredients sales were broadly unchanged, with AB Mauri recording growth in most markets. Currency devaluation in Argentina weighed on results, but adjusted operating profit is expected to be slightly ahead of earlier forecasts.
In sugar, sales are projected to fall 10% and the adjusted operating loss for the year is expected at £40 million, including the Vivergo bioethanol plant.
Source :
https://www.investing.com/news/stock-market-news/abf-reports-23-primark-sales-growth-in-us-offsetting-weaker-europe-4232602
