Associated British Foods (ABF) Trading Update summary

Group and Segment Revenue Performance

• Group revenue for the 16 weeks to 4 January 2025 was £6,732m, up 0.5% at constant currency but down 2.2% at actual rates.

• Retail (Primark) sales grew 1.9% at constant currency, with strong growth in Europe and the US but declines in the UK and Ireland.

• Grocery revenue rose 0.8% at constant currency, led by Twinings and Ovaltine, offset by declines in some US and UK brands.

• Ingredients revenue increased 3.5% at constant currency, driven by growth in yeast, bakery, and specialty ingredients.

• Sugar and Agriculture segments saw revenue declines, mainly due to lower European sugar prices and soft demand in compound feed.

Retail (Primark) Trading and Outlook

• Strong performance in Europe and successful store rollout in the US, with effective marketing, especially in Germany.

• UK and Ireland sales declined 4%, with like-for-like sales down 6.0%, impacted by weak autumn trading and cautious consumer sentiment.

• Click & Collect rollout progressing well, outperforming home delivery, with positive attachment sales and robust digital engagement; now in 113 stores.

• Store rollout contributed around 4% to total sales growth; eight new stores opened, with further progress in refurbishments.

• Primark targets low single-digit growth for 2025, with operating margin expected to be in line with FY24.

Consumer Trends and Geographic Performance

• UK consumer caution is driven by post-Budget sentiment, affecting both footfall and basket size, but not due to loss of customers to competitors.

• European markets, especially Spain and Portugal, show stronger consumer activity, with weather providing some stimulus.

• US like-for-like sales are impacted by new store openings and halo effects, but mature stores are trending toward neutral like-for-like growth.

• International markets now account for over half of total sales, providing geographic protection against UK volatility.

• Market share in the UK decreased slightly to 6.8%; December saw stronger sales after a weak October and November.