Shares in Primark owner AB Foods fell by more than 8% yesterday after the group said sales at its retail chain were hit by gloomy summer weather.

Primark’s UK like-for-like sales fell 0.6% in its third quarter and are set to slip by around 3.1% in the three months to 14 September, which marks the end of AB Foods' financial year. This will likely push the retailer’s UK comparable store sales 2% lower overall for the second half.

AB Foods said shopper footfall was impacted by "challenging weather, particularly in April and June", which took its toll on seasonal women’s clothing ranges and footwear. Primark also lost UK market share, with a small decline to 6.5% during the 24 weeks to July 21, as high street trade suffered. 

However, average selling prices increased thanks to a more favourable mix of sales towards higher-value items.

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There was also a better performance elsewhere across Europe, where six-month sales are expected to grow by 0.9%. Overall, Primark's sales in the second half are expected to be down by about 0.5% while underlying earnings remain on track for the full year.

This comes as it benefits from lower material prices, easing shipping costs and foreign exchange improvements, but it is still facing rising staff wage bills and higher spending on IT and marketing.

Chief executive George Weston said the group continued to perform well in the second half despite softer sales at Primark and, on the food side of the business, challenging conditions in the European sugar market.

"While the British weather was not in Primark’s favour this summer, robust growth in other markets and new store openings have driven good sales overall," he said. "Strong margin delivery is enabling increased investment in our product, digital and brand initiatives."

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Profitability in the group's sugar arm will be hampered as a return to more typical sugar beet crop production in the UK has raised supplies and in turn pushed down prices.

The division is forecast to deliver adjusted operating profit of approximately £200 million in the current year, which is lower than previously expected but still strongly ahead of last year when the unit contributed an adjusted operating profit of £169m.

But the reduction in pricing seen in the fourth quarter is likely to "significantly" impact performance next year, with operating profit now expected to be in the range of £50m to £75m. Profitability is then expected to recover and be more in line with financial 2024.

"Notwithstanding this short‐term volatility in sugar, we are optimistic about the outlook for the rest of the group, which is well-positioned for further strategic progress supported by continued reinvestment for the longer term," Mr Weston said.

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In the grocery unit, profitability in the second half is expected to be slightly ahead of previous expectations and in line with the same period last year. AB Foods said the division continued to perform well with sales growth of around 3% in the second half, reflecting good demand for international and regionally‐focused brands.

Profitability in the ingredients business was also "strong", the firm added, with sales continuing to grow well in the AB Mauri yeast and bakery ingredients business. In agriculture, AB Foods expects profitability to be "broadly in line" with last year.

Shares in AB Foods closed yesterday's trading 212p lower at 2,289p, a decline of 8.5%.