ociated British Food (ABF) generated £1 billion in profits in one year.
ociated British Foods (ABF), parent company of the low-cost clothing chain Primark, soared more than 6% on the London Stock Exchange on Tuesday after announcing an annual net profit up almost 50% to 1 billion of books, despite the cost of living crisis.
“The group achieved very good results during the financial year» completed on September 16, with turnover up 16% to 19.8 billion pounds, ABF announced in a press release. Faced with inflation which had cost it a billion pounds a year earlier, the group “implemented selective price increases” And “cautious» which have not diverted customers from its brands in the midst of the cost of living crisis, reports George Weston, the managing director. Primark sales were “excellent given the circumstances” And “even though consumer demand remains uncertain, Primark is still well placed», explains the manager. Primark’s marginsdecreased slightly, the group having chosen not to p on the full extent of the increase in costs (…) to satisfy price-sensitive customers”, while household budgets are under pressure, according to Aarin Chiekrie, analyst at Hargreaves Lansdown. But ABF indicated on Tuesday that the margins of its flagship division “now return to their historical levels“.
Share buybacks at 500 million pounds
“Even though the environment remains difficult for consumers, inflationary pressures have eased and volatility is lower than 12 months ago», ured the group. ABF announced on Tuesday a share buyback program of 500 million pounds in addition to a previous, equivalent one, completed in October, as well as a dividend up 37% over one year. Investors applauded and ABF saw its stock jump 6.55% to 2,244 pence on the London Stock Exchange around 09:20 GMT. “One of ABF’s main strengths is its diversified portfolio of activities», continues Aarin Chiekrie, while the parent company of Primark is also present in the food sector, notably with the Twinings or Ovaltine brands. “This diversification helps spread risk, ensuring that the company is not overly reliant on a single product or division“, according to him.