AB Foods mulls split of Primark, food businesses
Associated British Foods Plc is mulling a split of its Primark and food businesses under a review of its group structure currently underway in consultation with its biggest investor Wittington Investments, which remains committed to maintaining majority ownership of both businesses.
Chief executive George Weston said the group's "unique and exceptional food business has historically been less well understood by the financial markets than Primark, yet it has a highly attractive portfolio, deep global expertise and much potential".
"Primark has an incredibly strong international brand, a powerful customer proposition, and substantial growth opportunities." he added.
The company added that Primark's adjusted operating profit margin is expected to be slightly below last year as it focused on investing in growth to drive sales after posting a 26% fall in profit to £1.4bn for the year to September 13 amid a subdued consumer environment.
Weston added that he expected the consumer environment to remain subdued for the budget UK retailer and the company was focused on strengthening its customer value proposition through "product offer, price and price perception, and digital customer engagement".
Reporting by Frank Prenesti for Sharecast.com
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