Business
Trading Statement
Trading Statement.
About this update from Associated British Foods Plc
[{"type":"text","content":"\n \nRNS Number : 8428F Associated British Foods PLC 26 February 2018 \n \n\n26 February 2018\nAssociated British Foods plc\n \nPre Close Period Trading Update\n \nAssociated British Foods plc issues the following update prior to entering the close period for its interim results for the 24 weeks to 3 March 2018, which are scheduled to be announced on 17 April 2018.\n \nTrading outlook\n \nFor the half year, other than the expected reduction in Sugar revenues, sales growth will be delivered by all of our businesses at constant currency. We expect adjusted operating profit to be in line with that for the same period last year, and a lower net financial expense and lower group effective tax rate will lead to progress in adjusted earnings per share. \n \nAs already indicated, we expect margin in the second half for Primark to be higher than that in the same period last year. For the full year, our outlook for the group is unchanged with progress expected in both adjusted operating profit and adjusted earnings per share. \n \nCashflow and funding\n \nWe expect a return to an underlying cash out flow for the group, before acquisitions and disposals, in the first half of this year. This will mainly be driven, as in past years, by the seasonal increase in working capital in our European sugar businesses following the completion of processing campaigns and an increase in stock at Primark reflecting the timing of deliveries ahead of Chinese New Year. Capital expenditure will be at the same level as last year. Cash flow for the full year will also be in line with expectation.\n \nWe expect a net cash balance for the group of some £100m at the half year reflecting the operational cash out flow and the acquisition, on a debt-free basis, of Acetum in October 2017 for £284m. \n \nGrocery\n \nRevenue in the first half is expected to be ahead of last year at constant currency and, with progress in margin, operating profit will be well ahead driven by Twinings Ovaltine.\n \nRevenues at Twinings Ovaltine are ahead of last year at constant currency with especially strong growth for Ovaltine in its major markets of Switzerland, Germany, South Asia, Nigeria and Brazil, supported by new product launches. Twinings made good progress in the US and Italy although UK sales were held back b...