AB Foods: FY 2022-2023 Annual Results Statement

London / UK. (abf) British Associated British Foods PLC (ABF) announces its Annual Results Statement for the 52 weeks ended 16 September 2023. Chief Executive George Weston: «At the outset of this financial year the Group was facing very significant economic challenges caused in part by major geo-political events. Looking back on the year, it is clear to me that the Group performed extremely well and is as a result now well positioned for the year ahead.

«Trading at Primark was excellent under the circumstances. At the beginning of the year we implemented selective price increases partially to protect profitability, on the grounds that the significant input cost inflation was temporary. That careful pricing delivered as intended, with customers continuing to shop with us enthusiastically. Profitability in our food businesses moved ahead as a result of the appeal of our products and the strength of our brands, both of which supported us in the recovery of high levels of input cost inflation without disrupting our customer relationships.

«Although consumer demand remains uncertain, Primark is as well placed as it has ever been. We continue to believe that Primark’s offer is very attractive not just to existing customers but also to new customers engaged by our digital platform, new store openings, and word of mouth which remains as powerful as ever. With Primark margin now moving back to its historic levels, we view the future for this business with confidence. Our food businesses are also in very good shape, and our Sugar business especially should see much better profitability in the year ahead.»

FY 2022-2023 Performance

Strong performance in demanding environment
Significant growth in Group sales driven in large part by pricing actions
Resilient growth in Group adjusted operating profit
Continued momentum across Retail
Revenues well ahead at GBP 9.0 billion, supported by selective pricing and well received ranges
Adjusted operating profit 3 percent lower at GBP 735 million with margin of 8.2 percent reflecting our decisions on pricing
Space expansion on track with 27 new stores in the year
Continued investment in digital capability with completion of enhanced website rollout and Click + Collect expansion
Significant profit growth at Ingredients
Good growth in Grocery led by international brands, US focused brands and recovery in Allied Bakeries
Sugar sales well ahead, profitability ahead but impacted by more challenging British Sugar crop conditions and Vivergo
Lower profitability at Agriculture due to tough market conditions
Investment of GBP 1.2 billion with a number of strategic initiatives driving increased capacity and capability
Good progress on ESG priorities
Free cash flow of GBP 269 million with higher profit, offset by higher capital investment and reduced working capital outflow

FY 2022-2023 Shareholder returns

Initial GBP 500 million buyback programme concluded end of October. Additional GBP 500 million buyback programme announced
Total dividends of 60.0p per share up 37 percent comprising interim of 14.2 Pence per share, final proposed of 33.1 Pence per share and special dividend of 12.7 pence per share

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