ABF Associated British Foods Plc

By Ian Walker

LONDON--Associated British Foods PLC (ABF.LN) said Thursday group revenue for the 16 weeks ended Jan. 2 fell 2% at actual exchange rates, and backed its guidance for the year ahead.

The international food and ingredients firm, and owner of the Primark budget clothing chain, added that investment in expansion opportunities will continue, most notably for Primark, and there is increasing evidence that stability in sugar profit ahead the European Union quota removal in 2017 will be realized.

AB Foods, which houses Twinings, Ovaltine and Silver Spoon sugar among its brands, said at the time of its fiscal 2015 earnings in November, and again reiterated at the annual shareholder meeting in December that it expects currency pressures to lead to a "modest" decline in adjusted operating profit and adjusted earnings for the group for the full year.

AB Foods reiterated this again Thursday.

Primark sales for the 16 weeks rose 7% on a constant currency basis, but were only 3% higher at actual exchange rates due to the weakening of the euro against sterling. While comparable sales in the first seven weeks of the period were strong, the subsequent nine weeks suffered from the warmer weather. This echoes comments from both Next and Marks and Spencer.

In the year ended Dec. 12, 2015 adjusted operating profit, which strips out exceptional and other one-off items, was 1.92 billion pounds ($2.86 billion) and adjusted EPS were 102.0 pence.

Shares closed Wednesday at 3041 pence.

-Write to Ian Walker at ian.walker@wsj.com; @IanWalk40289749

(END) Dow Jones Newswires

January 14, 2016 03:01 ET (08:01 GMT)

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