Associated British Foods: Q3 26 update first take - Primark no worse than expected, but implied LSD% downgrades to group forecasts driven by Sugar

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Associated British Foods: Q3 26 update first take - Primark no worse than expected, but implied LSD% downgrades to group forecasts driven by Sugar

C A Z E N O V E Europe Equity Research

01 July 2026

Associated British Foods

Q3 26 update first take - Primark no worse than Neutral

expected, but implied LSD% downgrades to group ABF.L, ABF LN

forecasts driven by Sugar Price (30 Jun 26):1,986p

Price Target (Sep-27):1,780p

Our Take: In our view, this is a slightly disappointing update from ABF, with European General Retail

ACdowngrades to the Sugar business, and Primark LFL sales still in negative territory Georgina Johanan, ACA

(albeit no worse than expected). In Sugar, management now expects a FY 26 loss (44-20) 7134-5791

of between £25m and £60m – this compares to our current forecast for a loss of georgina.s.johanan@jpmorgan.com

£27m. Furthermore, looking ahead to FY 27, it comments that “our current J.P. Morgan Securities plc

expectation is for a further deterioration in the Sugar result from the £60 million Shailja Maskara

operating loss at the upper end of the range in 2026”. This implies a downgrade of (91-22) 6157-3318

shailja.maskara@jpmchase.com

>£30m vs our current forecast for a loss of £27m in FY 27 also. This should drive J.P. Morgan India Private Limited

LSD% downgrades to group PBT. At Primark, LFL sales in the quarter were -2.2%.

This compares to our forecast for -1.5% (although we think investors were Specialist Sales contact details:

expecting a slightly weaker performance than this). Whilst this result is an Olivia Petronilho - Specialist Sales -

improvement vs -2.7% in the first half (on a similar comparative), sales remain in European Consumer

negative territory and is not, in our view, a compelling indication that consumer (44-20) 3493-3709