- Food and clothing conglomerate Associated British Foods warned of a significant slump in annual earnings as the Covid-19 pandemic forced stores closures.

The company, however, added that its Primark discount clothing retailer was expected to generate adjusted operating profit at least at the top end of guidance following a strong showing in fourth-quarter.

ABF pinned the fall on earnings on a lower overall profit at Primark, due to store closures and the ongoing impacts on customer demand caused by Covid-19.

Adjusted operating profit for Primark on an IFRS16 basis, excluding exceptional charges, was now expected to be at least at the top end of the £300-to-350m range previously advised, down from £913m on-year.

In the UK, Primark sales since reopening were expected to be 12% lower on a like-for-like basis, while sales in Europe would be 17% lower on a like-for-like basis.

'In the latest four-week UK market data for sales in all channels Primark achieved our highest ever value and volume shares for this time of year,' the company said.

Aside from Primark, ABF said its food businesses also exceeded management's expectations in the final quarter of its fiscal year.

'For the full year we expect a very strong increase in the aggregate adjusted operating profit for our sugar, grocery, agriculture and ingredients businesses over last year,' the company said.

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