Food processor Associated British Foods (ABF) has shared its trading update for the 16 weeks to 3rd January, describing its trading as “mixed”.
During the first quarter, ABF’s food businesses experienced “mixed trading”, and the processor had expected “ongoing consumer weakness” to lead to lower sales in the US.
ABF brands include Dorset Cereals, Allinson’s, Jordans, Kingsmill and Silver Spoon.
In its cooking oils and bakery ingredients businesses, ABF said the impact had been “more acute than anticipated” and it was now more cautious on the outlook. As a result, ABF now expects both its grocery and ingredients segments to deliver adjusted operating profit for the full year that is “moderately below” last year.
In its grocery division, ABF said the effect of phasing means the impact will be “more significant” in the first half of the year.
On a constant currency basis, ingredient sales fell by 2%. Agriculture sales fell by 4%, and sugar sales were down by 5%.
ABF stated that it now expects its group adjusted operating profit and adjusted EPS to be below last year.
George Weston, chief executive of ABF, said: “Our food businesses experienced mixed trading in the period, particularly in the US where consumer demand in certain categories has continued to weaken. While we expect the tough trading conditions to continue in the short term, we remain confident in the overall prospects for the group.”
