Flight schedules expected to return to normal after chaos of last two days

Mark Crouch, market analyst at the trading platform etoro, said Primark’s recovery is still some way off, and welcomed the home delivery announcement.

The sharp drop at the open is the market saying Primark’s turnaround is still a story, not a number. Like-for-like sales at Primark, expected down 3% in the fourth quarter after a 2.2% drop in the third, tell investors the recovery they had started to price in is not here yet. Summer price cuts and a sharper UK offer have not turned the existing store base. New shops in the US can still lift the headline. They cannot, on their own, justify the multiple a standalone Primark will need. Europe remains the problem, and that is half the estate.

Home delivery in the UK is the right call and closes a long running gap. It will not rescue this Christmas, and the market has treated it accordingly.

Associated British Foods’ (ABF) fourth-quarter results have left investors hungry for more as its crown jewel, Primark, is expected to deliver a like-for-like sales decline of 3%. Growth in the UK and Ireland was barely positive, while sales in Continental Europe fell by more than 4% as consumer confidence remains particularly weak.

Primark also announced plans to introduce home delivery across Great Britain. While this will likely help boost the top line, running an efficient and profitable delivery and returns service is no easy task, and with Primark’s low price point, doing it profitably is even more difficult.

It was a mixed performance from the rest of ABF’s food businesses, with growth across grocery and ingredients largely offset by continued declines in the sugar and agriculture divisions. Performance in the sugar division continues to be held back by lower yields following a period of unfavourably hot and dry weather, as well as weaker average selling prices in Europe.

All in, ABF reiterated its rather vague full-year guidance for group-level underlying operating profits to fall below last year’s level of £1.7bn. But market forecasts are sitting around 13% lower at £1.5bn, which feels more realistic to us. Today’s update has done little to hint that a sharp improvement in fortunes is around the corner for ABF, and profitability in the Sugar division looks set to worsen still in 2027, offsetting progress in other parts of the business.