(Alliance News) - Associated British Foods said Friday it lost GBP430 million in autumn sales due to lockdowns forcing closures of its Primark retail arm.
However, AB Foods said sales since in the days since Primark fast-fashion stores lifted shutters once again have been "very strong".
"We have extended the opening hours during this festive season in most of our stores in the Republic of Ireland and England to cater for the anticipated higher customer demand and to help ensure a safer environment by spreading shopping hours over a longer period," Chair Michael McLintock will say at the diversified firm's annual general meeting Friday.
"Our estimate for the loss of sales for the announced periods of closure this Autumn is now some GBP430 million. The operating costs of the stores which were closed were reduced by some 25% during this period of closure. All orders placed with our suppliers have been honoured. In a small number of markets trading hours and store occupancy levels continue to be restricted and uncertainty about further temporary store closures in the short-term remains."
AB Foods expects both Primark's annual sales and profit to be higher year-on-year and, elsewhere, its Grocery, Sugar, Ingredients and Agriculture units are trading ahead of expectations.
AB Foods shares were up 0.8% early Friday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.5% at 6,522.19
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Hang Seng: up 0.3% at 26,804.06
Nikkei 225: closed down 0.2% at 26,751.24
DJIA: closed up 85.73 points, 0.3%, at 29,969.52
S&P 500: closed down 0.1% at 3,666.72
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GBP: down at USD1.3451 (USD1.3485)
EUR: flat at USD1.2155 (USD1.2153)
Gold: up at USD1,841.94 per ounce (USD1,826.52)
Oil (Brent): up at USD49.50 a barrel (USD48.50)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
0930 GMT UK CIPS-Markit construction purchasing managers' index
1100 GMT Ireland gross domestic product
1100 GMT Ireland balance of payments
0830 EST US international trade in goods and services
0830 EST US jobs report for November
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UK retail footfall tumbled in November, as England entered into a one-month lockdown, meaning many retailers missed out on a Black Friday trading uptick this year. According to British Retail Consortium-ShopperTrak monitor data, footfall in UK retail locations was 65% lower annually in November, far steeper than both the 34% decline in October and the 12-month average drop of 39%. For the fourth month on-the-bounce, high streets were the worst performing locations, with footfall down 64% year-on-year. November's drop was far more bruising than the 39% decline in October. Shopping Centre footfall fell by 62% annually, after a 38% fall in October. While retail parks saw a 27% decline, after a footfall drop of 9.3% in October.
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Germany factory orders rose above consensus in October, according to official data, with numbers suggesting the sector has recovered from the damage caused by Covid-19. Data showed German factory orders climbed 2.9% monthly in October, beating consensus estimates of a 1.5% rise. Data also showed a 1.8% annual rise in factory orders, a sizeable beat on market estimates which tipped a 2% fall. In September, factory orders had fallen 1.1% annually but rose 1.1% monthly. In October, domestic orders rose 2.4% monthly and foreign orders were up 3.2%.
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BROKER RATING CHANGES
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STIFEL EUROPE RESUMES BURBERRY WITH 'BUY' - TARGET 2000 PENCE
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DEUTSCHE BANK RAISES EASYJET TO 'BUY' (HOLD) - PRICE TARGET 1150 (550) PENCE
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BERENBERG RAISES CENTAMIN TO 'BUY' ('HOLD') - TARGET 146 (142) PENCE
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COMPANIES - FTSE 100
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Housebuilder Berkeley posted a first-half earnings fall but outlined plans for a previously deferred GBP455 million to go towards "incremental new land investment or enhanced cash returns". Berkeley posted a 17% fall in pretax profit to GBP230.8 million in the six months ended October 31 from GBP276.7 million a year before. Revenue slipped 3.8% to GBP895.9 million from GBP930.9 million. The company sold 1,104 homes during the period, down 21% from 1,389 a year earlier, though the average selling price rose 24% to GBP799,000. Back in June, Berkeley deferred for up to two years a GBP455 million return of surplus capital, due to Covid-19 uncertainty. It had been due to be delivered by March 2021. On Friday, the company confirmed the previously earmarked sum will now be delivered by the end of April 2023, "through either enhanced cash returns to shareholders, incremental land investment or a combination thereof". During the half year, the housebuilder returned GBP171.4 million to shareholders, up 14% from GBP149.8 million a year earlier.
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Paddy Power-owner Flutter Entertainment said it raised GBP1.1 billion from a placing of its shares at 14,000 pence each, a 2.1% discount to its closing price on Thursday. The cash will help fund a USD4.18 billion deal announced on Thursday to own nearly all of the FanDuel business, boosting its US exposure. Flutter said it will top up its stake in FanDuel - a fantasy sports, casino and horse racing business - by just over of 37%. It will have a 95% stake following the deal. The move to boost its FanDuel stake comes as London-listed peers have received interest from the US or have moved to boost their exposure in the lucrative gambling market there. On Wednesday, 888 Holdings said it has penned "multi-year market access agreements" which will double the number of US states in which it operates.
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COMPANIES - FTSE 250
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Pets At Home Group said it will repay the GBP28.9 million business rates relief it received through the Covid-19 pandemic, following the lead of supermarkets Tesco, Morrisons and Sainsbury's. "The aggregate result of Covid-specific costs and restrictions means that the financial impact of the pandemic on our business this year, currently estimated at over GBP35 million, will no longer be offset by the rates relief received," the animal products retailer said.
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COMPANIES - GLOBAL
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Pfizer and partner BioNTech will only deliver half the vaccines they had originally planned for this year, with the duo encountering supply issues, the Wall Street Journal reported on Thursday. The scaling up of the raw material supply chain took longer than planned, the WSJ explained, citing a spokesperson of Pfizer. The two partners planned to roll out 100 million jabs worldwide this year, but this has now been reduced to 50 million. Pfizer had the 100 million target until mid-November, when it conceded that the hurdles in the supply chain were too difficult to jump over, the WSJ said, citing a person involved with the development of the vaccine.
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Friday's Shareholder Meetings
VinaCapital Vietnam Opportunity Fund Ltd - AGM
Auctus Growth PLC - GM re purchase of HeiQ Materials AG
KKV Secured Loan Fund Ltd - EGM re investment policy, cash return, wind-down
Associated British Foods PLC - AGM
Abcam PLC - AGM
Hammerson PLC - GM re scrip dividend
Warehouse REIT PLC - GM re Greenstone acquisition
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By Tom Waite; thomaslwaite@alliancenews.com
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