ABF’s Primark delivers strong sales and profits from sugar industry

Associated British Foods (ABF) has issued its pre-close period trading update ahead of its interim results which will be announced on 21 April 2009 – with figures indicating that trading at Primark has been exceptional over the last year.

It attributes its strong figures to an increase in retail selling space, the retailer’s exceptional trading over the Christmas 2008 period, along with a 5% increase in like-for-like sales. By the end of this month, there will be approximately 187 Primark stores with a total 5.6 million square feet of selling space.

The company also plans to open seven new Primark stores in the second half of the year, at Bristol, Cambridge, Tooting, two stores in Spain and the company’s first stores in Germany and Portugal.

ABF is a diversified international food, ingredients and retail business. It is the UK agricultural industry’s biggest customer, Europe’s most efficient sugar producer through the British Sugar manufacturer, and owns brands such as Twinings, Ovaltine, Ryvita, Silverspoon and Kingsmill.

Its profits from the sugar industry are ahead of last year due to an “excellent campaign and sugar crop” in the EU, however sugar profits from China are down because of the record high stocks of sugar from last year’s crop.

Its agricultural business has also experienced a strong half-year, along with its ingredients business that benefitted from the weakness of the sterling against the US dollar and euro, due to the majority of operations being located outside of the UK.

ABF employs 96,000 people in 44 countries around the world. Of this figure, Primark –known as Penneys in Ireland – currently employs 25,500 people in the UK, Ireland and Spain.