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Caribbean Global Market Update

Primark Drives AB Food Profit Growth; L'Oreal and Burberry Results Diverge

Author: Sarla Buch
Last Update: 11:31 AM ET April 19 2017

4:00 PM Frankfurt AB Food profit surged 81%. Burberry plunged after the luxury retailer lowered profit forecast. Henderson said net asset outflows in the quarter were 1.8 billion. Heineken profit soared 11%. L''Oreal cosmetic sales jumped.

In London trading, FTSE 100 index fell 9.43 to 7,137.69 and in Frankfurt the DAX index rose 23.69 or 0.2% to 12,022.46.

In Paris, CAC 40 index gained 14.24 or 0.3% to 5,004.60.

Associated British Foods Plc gained 0.8% to 2,740 pence after the U.K.-based food and ingredients retailer reported group revenue in the first-half ending on March 4 soared 19% from a year ago to 7.3 billion.

Profit in the period surged 81.5% from a year ago to 646 million from 356 million and diluted earnings per share jumped to 80.5 pence from 44.9 pence.

AB Food said revenues in Primark segment jumped 12% from a year ago period and the company opened 16 new Primark store in eight countries and stores performed ahead of expectations.

Burberry Group Plc plunged 6% to 1,598.72 pence after the U.K.-based luxury fashion brand retailer said retail revenue in the second-half ending in March advanced 14% from a year ago to 1.6 billion and comparable store sales increased 3%.

The fashion retailer said revenues in the retail segment in the second-half soared 19% to 1.3 billion and wholesale revenue business fell 1% to 327 million from a year ago period.

The retailer estimated wholesale revenue in the first-half of fiscal 2018 to drop in mid-single-digit percentage from 287 million in the same period of fiscal 2017.

Burberry also lowered profit forecast to about 10 million, from the earlier estimated range of 20 million to 30 million.

Henderson Group Plc increased 2.3% to 232.20 pence after the U.K.-based investment and asset manager said assets under management in the first-quarter ending in March increased to 103.1 billion from 101 billion.

Total net outflow in the quarter were 1.8 billion, retail investors withdrew 1.4 billion while institutional investors redeemed 400 million.

Henderson said 85% of outflow occurred in the first two months of the year.

Heineken N.V increased 1.2% to 81.52 after the Netherlands-based brewer said net profit in the first-quarter soared 10.6% from a year ago to 293 million.

Beer volumes in the quarter rose 1% benefitted by 8.3% jump in the Europe and Asia Pacific region and beat expectations for sales on a strong performance.

L''Oreal SA rose 0.5% to 181 after France-based cosmetics maker reported group total revenues in the first-quarter ending in March jumped 7% from a year ago to 7 billion after strong sales in Asia and North America.

""We are confident in our ability to achieve another year of sales and profit growth in 2017,"" said chief executive officer Jean-Paul Agon.

Vision Express, the U.K.-based privately held optical retailer agreed to acquire opticians business of supermarket giant Tesco with its network of 209 stores across the U.K. and Republic of Ireland, which will bring the total number of outlets to 598.

The retail store network had revenues of 90 million in fiscal 2016 and the transaction is expected to complete later in this year.

Volkswagen AG gained 1.8% to 143.30 after Germany-based automobiles maker said preliminary group operating profit in the first-quarter of about 4.4 billion and reaffirmed operating return on sales to range between 6% and 7% in 2017.

Volkswagen said its namesake brand was the main profit driver and estimated operating profit in the passenger car division of about 0.9 billion.

Volkswagen is schedule to release its interim report on May 3.

Zalando SE declined 5.7% to 38.06 after Germany-based online shoes and fashion retailer forecasted revenues in the first-quarter ending in March to surge in the range of 22% to 24% or between 971 million to 987 million and operating profit between 10 million and 30 million.