Primark is boosted but foods group hits a sour note
Strong trading at retailer Primark failed to boost Associated British Foods after the Silver Spoon-to-Ovaltine conglomerate warned annual earnings will fall due to the strong pound and weak sugar sales.
The FTSE 100-listed firm, which employs 118,000 people in 47 countries, said operating profit at Primark jumped 8% to £322m in the 24 weeks to February 28, driven by an 11% increase in retail space.
The discount fashion retailer, which runs 287 stores in the UK and continental Europe, opened 10 stores in the period in countries including the Netherlands and Germany, as well as relocating its Northampton store to larger premises.
But overall, Associated British Foods said its adjusted operating fell 4% to £450m due to the strong pound and weak European Union sugar prices, causing a loss at its sugar unit.
It added that the strength of the pound, particularly against the euro, and its weak sugar business would lead to "a modest decline" in annual earnings per share at the group.
Shares fell 3% after the announcement.