By Sabela Ojea
Associated British Foods PLC reported Tuesday a significant rise in adjusted operating profit for the first half of fiscal 2022, ahead of prepandemic levels as expected, and said that Primark will raise prices to tackle the effects of inflation.
The British conglomerate posted an adjusted operating profit for the 24 weeks ended March 5 of 706 million pounds ($899.5 million) compared with GBP368 million for the year-earlier period. Primark’s adjusted operating profit increased to GBP414 million from GBP43 million for the prior year.
The FTSE 100 listed company’s revenue rose to GBP7.88 million from GBP6.31 billion for the year-earlier period. Primark sales rose 59% to GBP3.54 billion.
The company said Primark benefited from a strong sales recovery in U.K. and Ireland, as well as from positive trading across the U.S. However, it said consumer footfall in continental Europe remained weak.
The company’s food businesses saw a decline in profit, but remained resilient, and its sugar division had another strong performance, with a rise in profit, AB Foods said.
“With increasing inflationary pressure and dollar strengthening, we will implement selective price increases across some of our autumn/winter stock,” it said in relation to Primark. Primark’s adjusted operating profit margin stood at 11.7%, in line with views.
The board declared an interim dividend of 13.8 pence a share, up from 6.2 pence for the year-earlier period.
Write to Sabela Ojea at firstname.lastname@example.org; @sabelaojeaguix