LONDON (Reuters) -Associated British Foods on Tuesday reported a 15% rise in sales at its Primark clothing business over the 16 weeks to Jan. 7, benefiting from “very strong” trading in the Christmas period.
British official data showed inflation-pinched consumers cut their shopping by the most in the key month of December in at least 25 years, but some retailers performed better than expected, including those aimed at the value range of the market.
AB Foods said consumer spending had proven to be more resilient in the quarter than anticipated at the start of the financial year.
The group, which also owns major sugar, grocery, agriculture and ingredients businesses, said its total revenue was 6.7 billion pounds ($8.3 billion), up 16% on a constant currency basis.
“To date, Primark trading has been good in all our markets and was ahead of expectation,” it said.
“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.”
AB Foods, whose shares have fallen 8% over the last year but are up 18% over the last month, maintained its guidance for significant growth in sales in its full 2022-23 year but with adjusted operating profit lower than the 2021-22 outcome of 1.44 billion pounds.
The group said it continued to encounter significant cost pressures but inflation had become less volatile and recently some commodity costs had declined.
($1 = 0.8070 pounds)
(Reporting by James Davey; Editing by Kate Holton)
