Associated British Foods: Key takeaways from call

研报英文原文证据摘录

Associated British Foods: Key takeaways from call

Barclays | Associated British Foods

•• Disappointed that Primark Europe has not bounced back faster, but seeing a response to

market where initiative investments focused in an environment of subdued consumer

sentiment.

•• Iberia is better than France & Italy (two difficult markets), Eastern Europe remains good, and

Northern Europe soft (Germany, Austria, Netherlands).

°° France – key competitive dynamic is discount fashion retailer Kiabi which has upped its

game significantly in the last few years (355 stores today). Primark understands Kiabi much

better today. Also more Action stores, though not that active in fashion.

°° Spain – Consumer in better health and that is the main delta vs. other markets.

•• Plan is to have Click and Collect in Europe but will take time as need a supply chain solution.

•• Sharpening focus on key target customer base in Europe means refocusing on customers with

the same characteristics as their core loyalists.

Primark US:

•• Regional performance – Manhattan strong on flagship (now six stores in the New York).

Elsewhere in the US, where brand awareness is lower, trading has been disappointing.

Hispanic customers under pressure, particularly Florida and Texas.

•• Uplift to trading from tax refunds in March and April, which subsequently faded.

•• Hoping to have 47 stores in the US by year-end.

•• Levers to increase brand awareness and approach to openings. Can be very targeted in

marketing, which allows efficient spend. Heavy investment with the Manhattan flagship,

which sits in a cluster of stores. Will be pulling back on openings in areas where there is no

reason for Primark to be known. Also looking to sharpen the offer – in some areas, very much

a ‘me too’ player.