Associated British Foods Shares Plunge: Faces Primark Slowdown Despite US Strength

Associated British Foods (LON:ABF) shares plunged on Wednesday after the company warned of slowing sales at Primark in Europe, despite strong growth in the United States.

The ABF share price has fallen more than 9% to around 2,030p. It had earlier hit a low of 1,966p.

In a trading update, the group said Primark’s like-for-like sales for the second half of the financial year are expected to decline around 2% compared with last year, with a 2.4% drop in the third quarter and a projected 2% fall in the fourth. Sales growth for the full year is expected to be around 1%, largely driven by its ongoing store rollout programme.

Chief executive George Weston said: “I’m pleased with how the Group has performed in the second half of our financial year in what continues to be a challenging environment, characterised by consumer caution, geopolitical uncertainty and inflation. Primark delivered improved trading in the UK and strong sales growth in the US, while trading on the continent was softer in a weaker consumer environment.”

In the US, sales are forecast to grow 23% in the second half, helped by new store openings including the retailer’s first in Tennessee. The UK and Ireland delivered modest growth of about 1% in the same period, supported by womenswear, digital engagement, and the nationwide rollout of Click and Collect.

However, a “weaker consumer environment” in continental Europe weighed on overall performance. France and Italy saw a 4% decline in second-half sales, while Northern Europe recorded a 2% drop.

AB Foods kept full-year guidance unchanged, but investors reacted negatively to the slowdown in Primark’s key markets.

“Against a backdrop of continued volatility in 2026, we will start to see the benefit from our recent actions and continued investment,” concluded Weston.