Sugar woes sour ABF shares

Shares successful Associated British Foods fell contiguous (1 June) aft the UK radical said its sweetener concern had been deed by the Middle East crisis.

ABF said the Middle East struggle had pushed up costs for its sweetener limb and would dent the company's profits successful Europe.

"Aside from sugar, our afloat twelvemonth outlook for the radical is unchanged," ABF main enforcement George Weston said successful a trading update for the 16 weeks to 20 June.

The Twinings beverage and Patak's cooking sauces proprietor stuck to its radical forecast for company-wide adjusted operating nett and adjusted EPS to beryllium little year-on-year.

ABF's sweetener concern operates successful the UK, Spain and Africa. Its consumer-facing brands successful sweetener see Silver Spoon successful the UK and Bwana Sukari successful Tanzania.

Sales from ABF's sweetener concern declined 4% successful the 16-week period, which amounts to the company's 3rd quarter.

ABF pointed to reduced selling prices successful Europe and the interaction of higher imports successful South Africa owed to a hold successful tariff adjustments.

In the UK, the company's expectations for the 2025/26 beet harvest are unchanged but it said the profitability of the 2026/27 harvest was "still hard to assess".

The contracting circular has started and, adjacent though ABF said determination had not been "an upward inflection" successful European sweetener prices, the institution has seen state costs emergence "significantly" owed to the Middle East conflict.

The radical added: "If these dynamics persist, we expect to recognise onerous contracts successful the 2026 fiscal year."

In April, ABF announced plans to divided its premix of nutrient businesses from its clothing-retail limb Primark. The radical said the divided is intended to make "a clearer concern proposition" for each portion of the company.

ABF expects the demerger to beryllium completed earlier the extremity of the 2027 calendar year. The caller FoodCo concern volition span the group's operations successful grocery, ingredients, agriculture and sugar.

In the company's fiscal 3rd quarter, gross from its market limb grew 1%. ABF cited "good maturation crossed a fig of our brands and businesses" that was partially offset by little income of cooking oils successful the US amid little spending by Hispanic consumers.

Last month, the UK contention authorization approved ABF's acquisition of rival baker Hovis.

ABF's stock terms stood astatine 1,910 pence astatine 13:42 BST today, down 3.82%.

"Sugar woes sour ABF shares" was primitively created and published by Just Food, a GlobalData owned brand.