Breakingviews: Primark's US dream sweetens ABF’s sugar crash
Wednesday, April 23, 2014 - 03:45
April 23 - Shares in UK-based Associated British Foods bounce, as Primark's bold U.S. expansion plans help to offset a poor performance at its sugar business.
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I'm breaking -- today you where purchasing an associated British -- eight get shares soaring today off -- -- fast half results with me now as well Coulter took about this. Some really a story about primark isn't it it thinks I am. I essentially a story about trauma. I suppose in the really big news on that front and the thing is critical to invest is going I think is a decision via associated bush foods. To move into North America and openness. It's total two. In and in -- to -- a massive expansion but you know it's a very very confident moved because on shall -- knows who's. Appreciate that you -- retailers have had a really bad experience haven't decades of expansion in two. Into the US Tesco isn't the most recent example of the retailers spanning over them falling flat on his face. And and that comes on the back of some really very special results. From on mark styles up nicely. In fact I'm all up profits up. Even more and that is an aside is and and -- He's evidence in this whole cup priced to bite as well which is going on with the crisis in. That the that the the ability to give consumers really keen prices. Is a really powerful tool and primal shows that but actually there is more to. This story today and I think that this has dropped in -- Because. ABF has this -- collection of businesses the biggest of which processes shook up. And that has been a a difficult market this regime to regulate -- changes. In the European market full. -- sugar essentially Tyrus. What ship protected. European pieces of being taken away. Under these profits are down very very yen and that's significantly putts I think and the outlook there is back to them was expected. And crystalline structure isn't it for this company's sick and it sells it at retail. It does it why it's so Russian conglomerate and those sorts of structures would really difference the businesses really very different. I went -- to -- a long long time ago but time. IDF is controlled by them Weston family of -- of -- Founded this business -- own or control 55%. I think that I've I've played like led by a lot of the business in in this form. And actually the company do for the family coach and sort of argument to get which suggests that. Pot primark sits happily within this all shaped business because it's slightly insulate -- from the -- glare of public attention that was on its own it. Might be more focused but it might actually have to spend more time on. Corporate issues stock market issues and and and so on and so it's come a slightly insulated or expected. In that in that sense and and and they the other thing is today. But there's no real need for it. -- out to be sort of spits off which is what -- -- one instinctively things should happen. It's so cash generated so profitable that doesn't actually need an access to capital which would be one reason to split itself. I said that though you know I think them. This is a question which I think will be also die and in in in futurist. Whether the structure of this business really is -- -- -- going forward. And I'll just for a quick at judging -- what you're saying I guess this means that we might see back -- times it's even better times ahead ABS. But it's it's been a very strongly performing business and if it continues. In this land source gonna get a load the best possible.
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