AB Foods Group 16-Week Sales +22%; Primark Sales +22%

By Ian Walker

LONDON--International food, ingredients and retail group Associated British Foods PLC (ABF.LN) said Thursday group revenue for the 16 weeks ended Jan. 7 rose 22%, boosted by sterling weakness, with sales at its Primark budget fashion chain also up 22%, both at actual exchange rates.

On a constant-currency basis, group sales were up 10%, and Primark's sales were up 11%.

The company, which houses the Twinings tea and Ovaltine brands, said its outlook for the full year remains unchanged with progress expected in group adjusted operating profit and adjusted earnings. The adjusted figures strip out exceptional and other one-off items.

AB Foods, which has opened five Primark stores in the U.S., most recently in Connecticut, New Jersey and Pennsylvania, reiterated its operating profit margin would decline as the year progresses due to the strength of the U.S. dollar on input costs. However, it said foreign-exchange contracts are now in place for most of the remaining purchases for this financial year.

At the time of its annual general meeting in December, the company said it expected to benefit from the continued fall in the British Pound, but added Primark's margins would be hit because it buys most merchandise in U.S. Dollars.

Write to Ian Walker at [e-mail]; @IanWalk40289749

(END) Dow Jones Newswires

January 12, 2017 02:49 ET (07:49 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.