Associated British Foods share price: what’s the latest ahead of its full-year results
The British food processing and retail company will unveil its full-year results next week, with the company on track to meet its annual targets due to a strong performance from Primark.
Associated British Foods (ABF) will unveil its full-year results next week. The company is on track to hit its full-year targets, with earnings per share expected to be in line with last year’s 134.9p a share.
Unlike the name suggests, ABF owes its strong performance to retail rather than food, with growth from Primark able to offset its declining sugar business.
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Primark’s US expansion offers major growth potential
Full-year sales at Primark are expected to be up 4% compared with last year, driven by strong performances in the UK, Europe and US markets.
The US market offers ABF huge growth potential which is why it has embarked on an expansion stateside.
‘Our US business continued to deliver strong sales growth, driven by excellent trading at the Brooklyn store, which opened last summer, and like-for-like growth,’ the company said in its pre-close trading statement.
‘This, coupled with the lower operating costs arising from the selling space reduction in three stores, will result in a significantly reduced US operating loss.’
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ABF will open its tenth US store at the American Dream Mall in New Jersey this autumn, followed by another opening in Sawgrass Mills in Florida later in 2020.
If ABF can make Primark a success across the pond, which it is more than capable of doing considering the strength of its balance sheet and strong track record of expanding into new territories, its share price could see significant gains over the medium-term.
So far, this year the stock is up more than 9%, trading at £22.72 a share as of 12:10 GMT on Wednesday.
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