Associated British Foods Reports Revenue Drop, Primark Adjusts Targets

Associated British Foods reports a 2.2% drop in Group revenue amid challenging market conditions. Primark revised its 2025 sales growth target downwards from mid to low-single digits, signaling caution.

Date: 23-01-2025

AI Rating: 5

Earnings Per Share (EPS): The report does not provide specific EPS figures, thus cannot be analyzed. Revenue Growth: Group revenue fell by 2.2% to 6.732 billion pounds, indicating a negative trend. However, revenues grew by 0.5% at constant currency, showing some resilience. Net Income: There is no mention of net income, so this cannot be rated or assessed. Profit Margins: Primark's adjusted operating profit margin is expected to remain in line with last year's levels, which is a positive sign, especially amidst adverse conditions. Regarding the revenue segments, it is noted that retail sales decreased by 0.4% at current rates while rising by 2% at constant currency. In grocery, sales dropped by 1.8% but increased by 0.8% in constant currency, driven by strong international brand performances. Ingredients revenue grew by 4% at constant currency; however, Sugar and Agriculture faced declines with a decrease of 2% and 4%, respectively. Overall, the company is managing cost effectively to offset inflation, and although it faced a revenue decline, Primark's focus on product, digital, and branding initiatives suggests potential for recovery. The adjusted profit margin maintaining last year's level adds a buffer in a declining revenue environment.

Stocks: ASBFY ABF