Associated British Foods has said that it expects adjusted operating profit in the first half of its financial year to be ahead of expectations, despite the impact of COVID-19 on its operations.
The business posted the trading update as a follow-on from its update of 24 February, saying that it expects adjusted earnings per share for the first half to be ahead of last year last year on both a lease-adjusted and a reported basis.
In terms of the coronavirus impact on its Primark store chain, the firm said that 20% of its selling space is now closed across Europe, 'until the respective governments permit them to re-open', equating to around 30% of Primark's sales.
It said that the remainder of the estate, including the UK business (which accounts for 41% of sales), has seen like-for-like sales decline over the past two weeks due to reduced footfall.
'We are managing the business appropriately but do not expect to significantly mitigate the effect of the contribution lost from these sales,' it said.
'No Material Impact'
At the same time, the business said that it has 'not seen a material impact' on its sugar, grocery, ingredients and agriculture businesses.
It added that it is 'too early' to provide earnings guidance for the remainder of the current financial year.
'The group has a strong balance sheet, substantial cash liquidity with some £800m of net cash at the half year and significant undrawn bank facilities,' it said.
Associated British Foods will publish its interim results on 21 April.
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