Associated British Foods plc (LON: ABF) said on Tuesday that its pre-tax profit took a hit in the fiscal first half as the COVID-19 crisis weighed on revenue from Primark. The pandemic has so far infected more than 4.3 million people in the United Kingdom and caused over 127 thousand deaths.
Associated British Foods shares that you can learn to buy online here opened 4% down on Tuesday but recovered the majority of the intraday loss in the next hour. The stock is now trading at £24 per share. In comparison, it had started the year 2021 at a lower £22.26 per share.
Associated British Foods reports £275 million of pre-tax profit
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Associated British Foods reported £275 million of pre-tax profit in 24 weeks that concluded on 27th February. In comparison, it had posted £298 million of pre-tax profit in the same period last year.
The British multinational valued its revenue at £6.31 billion in H1 versus the year-ago figure of a higher £7.65 billion. The ongoing health emergency that pushed Primark into temporarily closing its stores, ABF said, resulted in a £1.10 billion hit to sales. Comparable sales at the clothing arm were down 15% on an annualised basis.
As per Associated British Foods, another hit to sales worth £700 million is expected in H2. Revenue from the fashion retailer in the first half stood at £2.23 billion. In an earlier report published in January, the food processing and retailing company said its revenue slid to £4.08 billion in the first sixteen weeks of fiscal 2021.
Associated British Foods declares 6.2 pence per share of an interim dividend
The London-based company announced 6.2 pence per share of an interim dividend on Tuesday. ABF hadn’t declared a dividend last year for the first half due to the Coronavirus-related uncertainty.
In its official statement on Tuesday, Associated British Foods said:
“The degree of uncertainty is now substantially lower than last year due to a large proportion of the UK adult population having been vaccinated and the successful reopening of Primark’s English and Welsh stores.”
In separate news from the United Kingdom, miner Rio Tinto reported a 7% increase in Australian iron-ore shipments.
Associated British Foods performed fairly downbeat in the stock market last year with an annual decline of more than 10%. At the time of writing, it is valued at £19.10 billion and has a price to earnings ratio of 41.84.