Associated British Foods (ABF) Trading Update summary

Trading performance and sales trends

• UK retail sales grew 3%, with like-for-like up 1.7% and market share gains, especially in womenswear, despite weak consumer sentiment.

• Continental Europe saw like-for-like sales decline by 5.7% amid weak consumer confidence, with no meaningful improvement over Christmas.

• US retail environment was volatile, impacting consumer sentiment and footfall.

• Store expansion, including the first franchise in Kuwait, contributed about 4% to sales growth, with 11 new stores opened globally.

• Primark's total sales rose approximately 1% in Q1, with a particularly disappointing Christmas trading period for clothing retail.

Profitability, guidance, and margin outlook

• Increased markdowns to manage inventory in a tough environment have impacted profitability, with first-half sales growth now expected in the low single digits.

• If current sales trends persist, full-year adjusted operating profit margin is expected to be around 10%, similar to H1.

• Group-adjusted operating profit and adjusted EPS are now expected to be below last year.

• The first half of 2025 included a non-recurring profit benefit of £20 million.

• Revenue growth by segment for the 16 weeks to 3 January 2026: Retail +4%, Grocery and Ingredients down, Sugar and Agriculture stable.

Strategic initiatives and digital transformation

• U.K. initiatives to improve price perception, product offer, digital marketing, and click-and-collect have driven sales uplift, especially in womenswear.

• Plans are underway to roll out click-and-collect and other digital initiatives in Europe, though full implementation will take time.

• Brand awareness and price perception are stronger in Spain, but weaker in France and Italy due to scale and execution differences.

• Store size strategy in Europe is shifting toward smaller formats, with large stores reserved for major metropolitan areas.