LONDON – Fashion and food may not make such a good couple after all, according to Primark’s owner Associated British Foods, which is considering separating the businesses to unlock long-term value for shareholders.
As part of its annual results statement on Tuesday, ABF revealed that the board is working with Rothschild & Co. on a “review of the group structure, with a view to maximizing long-term value.”
It said that while no decision has been made, the outcome may lead to the board to undertake “a separation of the Primark and food businesses,” which take in sugar, grocery and agricultural products.
The review is being conducted in consultation with ABF’s largest shareholder, Wittington Investments, which said it “remains committed to maintaining majority ownership of both businesses.”
ABF said the board would provide an update on the review “as soon as practicable.”
Shares were down 2.5 percent to 22.23 pounds on the London Stock Exchange at 11:15 a.m. GMT on Nov. 4.
An image from the Primark festive campaign.
Michael McLintock, chairman of ABF, said the company has delivered good long-term returns for shareholders in its current structure, but “given the scale that Primark has now attained, and the need for better understanding of our food businesses,” it was time to assess whether a separation of the Primark and food businesses would be a better structure in the years ahead.
George Weston, chief executive officer of ABF, said he supports the board’s review and will be “closely involved in the process and any outcome.”
Weston said the food business has historically been less well-understood by the financial markets than Primark, “yet it has a highly attractive portfolio, deep global expertise and much potential. Primark has an incredibly strong international brand, a powerful customer proposition and substantial growth opportunities. I am very excited by what we can deliver in the future for both food and Primark.”
In the 52 weeks to Sept. 13, ABF group revenue was down 1 percent to 19.5 billion pounds. Growth in retail, the Primark stores, was offset by a decline in sugar. Adjusted operating profit declined 12 percent to 1.73 billion pounds, due to the reduction in operating profit in sugar.
Retail sales grew 1 percent to 9.5 billion pounds, with “good” execution of store rollouts in Europe and the U.S. contributing 4 percent to sales growth, ABF said. U.S. like-for-like sales improved in the second half, due to a renewed focus on Primark’s “value proposition and product offer.”
ABF said that on both sides of the Atlantic there had been a “significant” step-up in investment in digital, brand and product initiatives to drive long-term growth at Primark.
Weston added that Primark’s improved U.K. trading in the second half “was encouraging and reflects renewed focus on our value proposition, a stronger product offer and enhanced digital capabilities. We have more to do in some of Primark’s European markets, and there are plans in place.”
He said “significant white space remains” as Primark continues its store expansion in existing and new markets and through franchise opportunities.
The U.K. and Ireland are Primark’s largest markets, generating nearly half of sales in 2025. The U.S. is currently the smallest, representing 6 percent of sales in the last 12 months.
While the U.S. may still be small, business there is growing rapidly. Sales in the region grew 20 percent due to the opening six new stores over the past year, including Primark’s first openings in Texas and Tennessee. There are now U.S. 33 stores in total, with an additional 18 leases signed, the company said.
Primark in Concord Mills in North Carolina.
Courtesy image
The U.S. isn’t Primark’s only international growth market. Primark has signed its first franchise agreement with the Alshaya Group to enter the Gulf markets and opened a store in Kuwait in October. It expects to open three stores in Dubai in early 2026.
Weston said that, looking ahead, ABF is confident in the group outlook for 2026, “although much depends on the consumer environment, which is particularly unpredictable at the moment. Our strong balance sheet underpins disciplined investment as we continue building brands and businesses that will deliver growth over the long term.”
