Associated British Foods Share Discussion Threads

[philanderer] 24/2/2023 16:16

Trading update monday.

[philanderer] 13/2/2023 10:46

Davy raises AB Foods price target to 2,120 pence - 'outperform'

[m_kerr] 09/2/2023 16:27

there's no way this would survive as a conglomerate in this form without the controlling shareholder.

[tlobs2] 09/2/2023 10:09

Lack of focus? We must be looking at different companies called ABF ;-)

For clairity .... details of the diverse one that I am posting about are here :-

From Wikipedia, the free encyclopedia

Associated British Foods plc (ABF) is a British multinational food processing and retailing company headquartered in London, England.

Its ingredients division is the world's second-largest producer of both sugar and baker's yeast and a major producer of other ingredients including emulsifiers, enzymes and lactose.

Its grocery division is a major manufacturer of both branded and private label grocery products and includes the brands Mazola, Ovaltine, Ryvita, Jordans and Twinings.

Its retail division, Primark, has some 384 stores across several countries, predominantly Germany, Ireland, Netherlands, Spain, and the UK. ACH Food Companies is an American subsidiary.

Associated British Foods is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.

[m_kerr] 08/2/2023 18:55

it's more a family wealth vehicle than a business focused on shareholder returns IMV.

i think each business unit is run very well, but it has an overall lack of focus on shareholder returns - they should have been buying as much stock as the market would offer when the price dropped below £15. an activist would have a field day pulling apart the idea of putting all these different assets together but they're protected from that scrutiny by the family control.

[tlobs2] 07/2/2023 11:49

ABF are a well run, profitable and diverse organisation with decent cash reserves.

At £20 the shares are undervalued IMHO A steady rise back up to £25 over the next twelve months would be very acceptable ;-)

[m_kerr] 05/2/2023 20:09

it's no longer the bargain it was at about 7.5 x EBIT, but still reasonable value at about 12 x EBIT IMV. sentiment seems to be on a bit of an upswing at the moment and ABF is generally considered sensitive to a downturn or upturn. i've never understood that, it's a very steady performer throughout the cycle, yet despite that has seen pretty wild swings in valuation this year.

[tlobs2] 01/2/2023 12:37

J777j nobody forces you to go in their shops or buy their products.


Given the continued profits and growth that they have been generating over the years I think they know a little bit more about running a business and making money than you do.


Nevertheless, thank you for sharing your wisdom with us. I take it that you don't own any sharess in ABF.


Indeed some might smell a rat and think that you are simply just an under pressure shorter. LMAO

[livewireplus] 31/1/2023 18:35

Primark to open first store in Hungaryhttps://www.imagesretailme.com/fashion-lifestyle/primark-to-open-first-store-in-hungary-primark-to-open-first-store-in-hungary/

[suetballs] 25/1/2023 13:45

£20 will do for starters.
I've always thought that Primark would make it in the States. They have imo made a reasonable start and if it takes hold ......
Suet

[philanderer] 25/1/2023 13:22

SocGen raises AB Foods price target to 1,900 (1,575) pence - 'hold'

Barclays raises AB Foods price target to 2,000 (1,700) pence - 'equal weight'

Goldman Sachs raises AB Foods price target to 2,000 (1,900) pence - 'neutral'

[j777j] 25/1/2023 09:59

Oh dear whatever next? Good old AB foods first it was slave labour now pesticides in its top shelf tea

9 Pesticide-filled Teas You Should Never Buy


1. Twinings Earl Grey
This classic tea is considered a relatively high quality bagged tea. However, it placed third highest in pesticide content. Most alarmingly, this tea was repeatedly found to contain acetamiprid, a poison that causes severe nausea and vomiting, muscle weakness, hypothermia, convulsions, and hypoxia in small quantities


Daily health Post

[wolfofhounslow] 24/1/2023 19:20

Bank of America raises Asos to 'buy' (underperform) - price target 1,650 (450) pence

[darrin1471] 24/1/2023 15:35

For 16 weeks to January in
2020 £2,904m from 15.8 million sq ft (£183.8 per sq ft)
vs
2023 £3,145m from 17.7 million sq ft (£177.7 per sq ft)

So sales down 3.5% per sq ft since covid before you take into account inflation.
Rents should be lower in new locations and where rents are up for renegotiation.

[philanderer] 24/1/2023 11:38

Credit Suisse raises AB Foods price target to 2,440 (2,150) pence - 'outperform'

[factsandfigures] 24/1/2023 11:32

Further confirmation that Bricks N Mortar retailers trounced Online only retailers in the 3 months run up-to Xmas 2022.

PRIMARK TRADING UPDATE

Primark trading has been good in all our markets and was ahead of expectation. We had a very strong Christmas period. We believe our proposition of great quality at affordable prices and attractive store experience is proving increasingly appealing to both existing and new customers. Early trading in this new calendar year has been encouraging but macro-economic headwinds remain and may weigh on consumer spending in the months ahead. We had an accelerated programme of store openings in the period and remain on track to add a net 1 million sq ft of retail selling space in this financial year.

[fuji99] 24/1/2023 11:09

A sound business but when it issues a statement like this one, it means it will stagnate in the near future with no growth and if growth is decelarating, the share price has to correct accordingly: "For the full year, our expectation for the Group result overall is unchanged with a significant growth in sales, and adjusted operating profit and adjusted earnings per share to be lower than the previous financial year."

[tlobs2] 24/1/2023 09:43

I must have read a different trading update !!

How can the price drop based on that? WTF were others expecting?

Oh and good luck netcurtains ;-)

[netcurtains] 24/1/2023 08:16

I sold this morning. There is never a bad time to take good profit.
Time for someone else to have a go.
Good luck longs.

[skinny] 24/1/2023 07:09

.




Associated British Foods plc today issues a trading update for the 16 weeks to 7 January 2023 summarising the significant trading developments since the last market update.

Group revenue

Group revenue for the 16 weeks ended 7 January 2023 was GBP6,698m, 20% higher than the comparable period last year at actual exchange rates and 16% higher at constant currency. The difference in revenue growth between actual exchange rates and constant currency was mainly driven by the significant strengthening of the US dollar in this period. The following table sets out revenue by business segment.


Year to date Last year Change Change at
constant
GBPm GBPm currency
------------ ------------ --------- ------ ---------
Grocery 1,389 1,215 +14% +9%
Sugar 795 609 +31% +27%
Agriculture 651 545 +19% +17%
Ingredients 718 528 +36% +26%
Total Food 3,553 2,897 +23% +17%
Retail 3,145 2,672 +18% +15%
Group 6,698 5,569 +20% +16%

Trading summary and outlook

We continue to encounter significant cost pressures but inflation has become less volatile and recently some commodity costs have declined. Consumer spending has proven to be more resilient in this trading period than anticipated at the start of the financial year.

Pricing actions taken by our Food businesses to recover the significant inflation in input costs are more evident this period. For the full year we continue to expect the aggregate profit of our Food businesses to be ahead of our last financial year but with a lower margin. We now expect the operating result at AB Sugar to be broadly in line with last year as a result of a much-reduced UK sugar crop, and for trading at Ingredients to be better.

To date, Primark trading has been good in all our markets and was ahead of expectation. We had a very strong Christmas period. We believe our proposition of great quality at affordable prices and attractive store experience is proving increasingly appealing to both existing and new customers. Early trading in this new calendar year has been encouraging but macro-economic headwinds remain and may weigh on consumer spending in the months ahead. We had an accelerated programme of store openings in the period and remain on track to add a net 1 million sq ft of retail selling space in this financial year.

For the full year, our expectation for the Group result overall is unchanged with a significant growth in sales, and adjusted operating profit and adjusted earnings per share to be lower than the previous financial year.

Food

Aggregate revenue from our Food businesses was 23% ahead of the comparable period last year at actual currency and 17% ahead at constant currency. This increase was primarily driven by price actions to recover significant input cost inflation in our Grocery, Ingredients and Agriculture businesses while Sugar revenues reflected higher sugar and co-product prices in Europe and Africa.

Input cost inflation is becoming less volatile and recently some commodity costs have declined. However, all our businesses continue to work hard to restore margins which have been and remain under pressure.

In AB Sugar, UK sugar production from the 2022/2023 campaign is now expected to be some 0.74 million tonnes, lower than our previous forecast of 0.9 million tonnes and compares to 1.03 million tonnes from our last campaign. This reflects lower beet sugar yields following adverse weather conditions, especially recently. Profitability at British Sugar will be lower than expected as a result. Sugar production at Illovo is expected to be higher than forecast and will be above last year's 1.45 million tonnes. Vivergo, our bioethanol plant in Hull, has been operating well but made a loss in the period due to volatility in its energy and other input costs and bioethanol prices.

In our Grocery businesses, inflation in input costs continued to run ahead of pricing to recover margins and for the full year we continue to expect some erosion of adjusted operating profit margin.

Our Ingredients businesses performed very strongly in the period and we now expect full year operating profit to be ahead of last year. AB Mauri exceeded expectation with both recovery of input cost inflation and volume growth delivering good revenue growth in all its major regions. ABF Ingredients, our speciality ingredients businesses, continued to trade strongly.

Retail

To date, Primark trading has been good in all our markets and was ahead of expectation. We had a very strong Christmas period.

This year footfall was strong in both the UK and the Eurozone, unit volumes increased, and sales were 18% ahead of last year at actual exchange rates and 15% ahead at constant currency. Last year the omicron pandemic impacted footfall.

Primark like-for-like sales were 11% ahead, supported by higher unit volumes, higher average selling prices and a normalised level of markdown. Sales in the week leading up to Christmas Day reached a new record. Retail selling space increased from 17.0 million sq ft to 17.7 million sq ft year on year and all the new stores are performing well.

In the UK there was a step-up in performance with sales 15% ahead of last year, nearly all of which was like-for-like growth. Primark's share of the total UK clothing, footwear and accessories market by value, which includes online sales, for the 12 weeks ended 11 December 2022 reached 7.0%, up from 6.5% in the comparable period last year, and was very close to the record trading when stores reopened in June 2021 after a prolonged lockdown. Of note, footfall is now strong in major city centres as well as on high streets and retail parks.

Trading in Europe, excluding the UK, was very encouraging with sales up 16% with growth in all markets. Like-for-like sales were 8% higher. We have had a very extensive store opening programme in this region, opening 12 stores over the last 12 months. The new stores in Bucharest, Romania, and in Caserta, near Naples in Italy, are both performing particularly strongly.

We are encouraged by sales growth of 4% in the US given the strength of prior year comparatives which were supported by COVID related government stimulus. We plan to nearly double selling space in the US in this financial year and opened three stores towards the end of the period - Roosevelt Field, Long Island; Jamaica Avenue, Queens; City Point, Brooklyn - and all are performing well. We also extended our recently opened store at Sawgrass Mills in Florida.

Adjusted operating profit margin in the period was better than expected as a consequence of the sales performance. As expected, the margin was somewhat lower than in the same period last year as a result of inflation in the cost of bought-in goods driven by the significant strengthening of the US dollar against sterling and the euro, and higher freight rates, labour and energy costs.

Primark's digital capability continues to develop. With improved functionality and better customer experience, the new UK website's traffic has increased some 85% since last year, with double the average pages viewed per session. The new site has just been launched in the Republic of Ireland, to be followed in the coming months by Germany, Spain, and the US, with remaining markets expected by the middle of the calendar year. We are encouraged by our Click and Collect trial of children's products in 25 stores in the UK.

We had a strong programme of store openings in the period and retail selling space increased by 0.4 million sq ft. At 7 January 2023, 416 stores were trading from 17.7 million sq ft which compared to 17.0 million sq ft a year ago. Ten new stores were opened in the period: our first store in Romania, Primark's 15th market, three in the US, two in Italy, two in Poland, one in France, and one in Northern Ireland. Following the devastating fire in 2018, we were delighted to reopen fully our Bank Buildings store in the heart of Belfast. We extended our stores at Sawgrass Mills, Florida, and Galway Eyre Square, Republic of Ireland. We closed our store in Weiterstadt, Germany as planned and, after the reopening of Bank Buildings, our temporary store in Donegal Place, Belfast.

In this financial year we will open a further 17 stores: seven in the US, three in France, three in Spain, two in Italy, one in Romania, and our first store in Slovakia, which becomes Primark's 16th market, in Bratislava. Taken with a small number of relocations, extensions and a further planned store closure in Germany, we continue to expect to add a net 1 million sq ft of retail selling space in the financial year. We have recently signed a lease for our first store in Hungary, which will become Primark's 17th market, in Budapest.

Notes:


- The like-for-like Retail metric reflects the measurement of the
performance of our retail stores on a comparable year-on-year basis.
This measure represents the change in sales at constant currency
excluding new stores, closures and relocations. It is measured against
comparable trading days in each year.
- Definitions of the alternative performance measures referred to
in this announcement can be found in note 30 of our Annual Report
and Accounts 2022.

[tlobs2] 24/1/2023 07:05

Looks very promising to me.


Perhaps it's not as bad out there as the clowns in the UK media have been trying to make out.


LOL

[philanderer] 23/1/2023 12:33

Trading update tomorrow.


--------------------------------


tp = 2180p


Mon, 23rd Jan 2023 11:48

(Sharecast News) - Deutsche Bank upgraded its recommendation for shares of Associated British Foods from 'hold' to 'buy', judging that the headwinds from energy prices and foreign exchange rates were reversing.

In a research note sent to clients, analyst Adam Cochrane said: "The guidance for FY 2023 was given at a relative low point for GBP strength and energy headwinds have reduced significantly since this stage," Dow Jones Newswires reported.

AB Foods' Primark unit was likely to improve its margins, benefiting from both trading down and new space growth, Cochrane added.

The analyst also pointed to the company's "robust" balance sheet and ongoing share buybacks to support his upgrade.