Associated British Foods (ABF) H1 2026 earnings summary

Executive summary

• Board announced and reaffirmed the demerger of Retail (Primark) and Food businesses, targeting completion by end of 2027, with shareholders to receive shares in both entities and a focus on clearer investment propositions and accountability.

• H1 2026 performance was broadly as expected, with group adjusted operating profit down 17–18% and adjusted EPS down 15% year-over-year, mainly due to cost pressures and investment.

• Primark UK outperformed with market share gains and digital initiatives, while Europe lagged and Sugar posted a significant loss.

• Significant capital investment and leadership changes, including new Group CFO and Primark CEO.

• Free cash flow improved to £71m, and interim dividend maintained at 20.7p per share.

Financial highlights

• Group revenue was £9,470m–£9.5bn, flat year-over-year at actual rates and down 2% at constant currency.

• Adjusted operating profit was £691m, down 17–18% year-over-year; adjusted EPS 70.7p, down 15%.

• Free cash flow rose to £71m (from £27m prior year); net debt increased to £3bn–£3,027m; leverage ratio 1.2x.

• Interim dividend maintained at 20.7p per share; share buybacks of £133m–£187m completed YTD.

• Exceptional items of £8m, mainly a non-cash impairment in Sugar.

Outlook and guidance

• Full-year outlook unchanged except for Sugar, which is now expected to deliver a full-year operating loss.

• Group adjusted operating profit and EPS expected to be below last year, with profit phasing weighted to H2.

• Primark margin guidance unchanged at ~10% for the year; expects 4% sales growth from store rollouts.

• Grocery and Ingredients expected to improve in H2 but remain moderately below last year; Agriculture profit to remain below 2025.

• Middle East conflict cost impacts expected to be manageable through 2026, but consumer demand risk remains.