Associated British Foods (ABF) said Primark’s adjusted operating profit fell 12% at constant exchange rates in the year to Sept. 12, 2026, as sales at existing stores declined ahead of its planned December 2027 separation.
The retailer’s revenue reached £9.82 billion, up 4% at actual exchange rates and 2% at constant exchange rates. Adjusted operating profit was £1.005 billion, down 11% at actual exchange rates, while the adjusted operating margin fell to 10.2% from 11.9%.
Like-for-like sales declined 2.6% overall. They rose 0.5% in the UK and Ireland but fell 4.7% in continental Europe. New store openings contributed 5% to sales growth, ABF said. The company linked weaker profit to lower comparable sales and markdowns, as well as spending on prices, products, marketing and digital initiatives.
“Our results this year reflect a challenging operating environment and macroeconomic headwinds,” said George Weston, ABF’s chief executive.
ABF expects Primark’s adjusted operating margin to be about 10% in 2027, excluding expected demerger dis-synergies. It forecasts that added space in Europe, the United States and franchise markets will contribute about 4% to sales growth that year. Primark has also acquired a highly automated fulfilment facility in Sheffield to support future home delivery in Great Britain.
ABF said a split would give each company a governance structure and investment case shaped around its industry, while allowing shareholders to assess the businesses separately. Existing shareholders are expected to receive shares in both businesses through a dividend demerger, with the food company to be called AB Foods. The company’s April estimate put one-off separation and transaction costs at about £75 million, with combined dis-synergies below £45 million.
In a Nov. 3 column, The Guardian’s Nils Pratley said the separation had a business rationale but questioned whether it would unlock significant value for investors.
Investor education events for the food business are scheduled for April through July 2027, ahead of the planned December separation.
