How Was The performance Of Associated British Foods Plc In H1 FY19?

  • Apr 26, 2019 BST
  • Team Kalkine
How Was The performance Of Associated British Foods Plc In H1 FY19?

The Associated British Foods (ABF) Plc is engaged in the diversified business of food, ingredients and retail business. The group’s major businesses include Sugar, Ingredients, Grocery, Agriculture and Retail. ABF caters its products primarily to industries including Agriculture, Pharmaceutical, Retail and Food.

On April 24, 2019, the company reported a 1% surge in the group’s revenue to £7.53 bn for the first half of FY19; period ended as on March 2, 2019. Adjusted profit before tax of £627 mn was in line with the performance of H1 FY18.

Reported revenue from grocery business segment stood at £1.721bn and witnessed a surge of 3 per cent on a y-o-y basis. Revenue from Sugar business reduced to £769 mn against the revenue of £881 mn during the corresponding period of the previous financial year and witnessed a plunge of 13% on AER basis. Agriculture business segment reported revenue growth of 8% to £665 mn against revenue of £614 mn reported during the first half of FY18. Ingredients business segment revenue grew by 4% (AER basis) to £744 mn against the revenue of £716 mn in H1 FY18, and sales of Primark, which comes under the retail segment grew by 4% to £3.63 bn from £3.47 bn in H1 FY18.

Revenue growth in Primark was primarily driven by increased retail selling space, with a much higher profit margin. Profit from the Primark business was 25% higher than the profit reported in the first half of FY18.

In H1 FY19, the company has substantially enhanced its market share in clothing, footwear and accessories market. The impact of weak footfall in November 2018, was offset by increased trading in the rest of the months in the H1 FY19.

During the period, the company has opened 11 retail stores, including 4 in the UK, 2 in Spain, 2 in Germany, 2 in France and 1 in Belgium. Also, they are planning to open three more stores in the second half of the FY19, with 1 in Netherland, 1 in Germany and 1 in Slovenia.

An Interim dividend of 12.05 pence has been declared by the management board of the ABF Group and was up by 3 per cent as compared to the last year data.

Stock Performance – 1Year

Daily price chart (as on April 26, 2019), before the market close. (Source: Thomson Reuters)

At the time of writing (as on April 26, 2019, at 10:25 AM GMT), shares of ABF were quoting at GBX 2,519.00. During the past one-year, shares have registered a 52w high of GBX 2,846 and a 52w low of GBX 2,011 and at the current market price, as quoted in the share price chart, shares were trading 27.15% above the 52w low price level.

Also, the stock was trading above its 30-day, 60-day and 200-day simple moving average (SMA), which is a positive technical indicator.

The outstanding market capitalisation of the company stood at £20.28 bn, which ranks it among the large-cap stock listed on the London Stock Exchange and also a constituent of FTSE 100 Index. At the current price level, the dividend yield of the company stood at 1.77%.

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