- Associated British Foods reported a slump in annual profit as the coronavirus-led hit to Primark sales offset growth in its sugar and food ingredients units.

For the year ended 12 September, pretax profit fell 40% to £686 million year-on-year as revenue dropped 12% to £13.94 billion.

The revenue decline was mainly driven by the 'loss of sales for the period in which Primark's stores were closed,' the company said. 'We estimate that Primark lost £2bn of sales and some £650m of profit as a result of COVID-19.'

The weakness in Primark offset combined adjusted operating profit growth of 26% for grocery, sugar, ingredients and agriculture.

Looking ahead, the company said it expected to see an improvement in Primark sales.

'Notwithstanding the currently announced periods of restriction, we expect Primark full year sales and profit to be higher next year,' the company said. 'There will be a sales decline in the first half compared to last year but higher sales in the second half, reflecting the period of store closures in the third quarter of this financial year.'

'We will continue to expand retail selling space. Sugar is expected to deliver a higher profit next year with improvements in Europe and in the performance of Illovo,' it added.

At 8:28am: [LON:ABF] Associated British Foods PLC share price was -17p at 1705p

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