By Matteo Castia
Associated British Foods PLC said Monday that trading in the fourth quarter of fiscal 2020 beat its expectations for both Primark and its food businesses.
The British conglomerate said trading at its flagship Primark clothing brand has been strong since reopening in May and that it expects the brand to generate cumulative sales of 2 billion pounds ($2.66 billion) at year-end.
AB Foods said it expects Primark's adjusted operating profit for the year ending Sept. 12 to at least reach the top end of its previously announced guidance of GBP300 million to GBP350 million.
This is in line with analysts' projections at Numis Securities, who had forecast Primark to support profitability toward the upper end of management's range.
The company said revenue from its grocery business will be ahead of fiscal 2019 results. "Although Westmill and AB Sports Nutrition have seen sales and profit declines due to the reduction in foodservice activity and sports events respectively, Silver Spoon, Jordans, Dorset Cereals, Ryvita and AB World Foods all benefited from significant increases in consumer demand in the second half," the company said.
The sugar and agriculture units are also forecast to deliver full-year profitability ahead of the previous year, the companu said.
AB Foods said the GBP284 million charge it had recognized in its half-year report due to inventory is yet to be delivered.
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