Retail and consumer names dominate this morning's news flow, headlined by Associated British Foods flagging a sharp deterioration in its sugar business even as Primark holds up on trading. Currys posted robust UK growth figures, Eleco agreed to a £207.6m private equity takeover, THG beat its own first-half guidance, and Debenhams Group (AIM:DEBS) struck a £90m property deal with Primark that materially improves its balance sheet.
ABF flags widening sugar losses as Primark plots home delivery
Associated British Foods (LSE:ABF) told investors that fourth-quarter adjusted operating profit is expected to be broadly in line with previous expectations, with adjusted earnings per share ahead of forecasts. Primark, the group's value fashion arm, guided to full-year sales growth of around 2%, with like-for-like sales down around 2.6% as new store openings and franchising added around 5 percentage points of growth. Continental Europe remained the weak spot, with fourth-quarter like-for-like sales down around 4.3% against a broadly flat UK, where Primark continued gaining market share despite hot weather delaying autumn clothing demand; the retailer is now launching home delivery in Great Britain, backed by a newly acquired automated fulfilment facility in Sheffield, alongside its "Iconic Value" pricing campaign.
The more troubling detail sits in Sugar. The division is now expected to post a full-year adjusted operating loss towards the higher end of its £25m to £60m guidance range, hit by onerous contract provisions, higher gas costs and weaker UK beet crop yields following prolonged hot, dry weather. For 2027, ABF guided sugar losses to widen sharply to between £70m and £170m, reflecting European market surplus and cost pressures, though it flagged that recent firmer European and global sugar pricing should benefit future years. Grocery adjusted operating profit for 2026 is also expected slightly below prior expectations, as hot weather curbed Twinings tea consumption in the UK and Europe.
"The group delivered resilient trading in the quarter, remained challenging," said George Weston, Chief Executive.
The scale of the sugar guidance cut is the story here: a division already running losses is now set to more than double them next year, a signal that European sugar economics have structurally worsened rather than merely dipped cyclically. That complicates the backdrop for ABF's planned demerger of its Retail business from Food, which remains on track for completion in December 2027, investors will want clarity at the 3 November full-year results on how much of the Food division's earnings power is being eroded by Sugar before that separation completes.
Currys reports 6% UK sales growth and repeats guidance
Currys (LSE:CURY) said UK and Ireland like-for-like revenue rose 6% in the 17 weeks to 29 August, with growth across both stores and online, while its Nordics business grew like-for-like revenue by 9% on strong white goods and mobile sales. The electricals retailer said it gained market share in every UK category despite a flat overall market, which it estimated benefited by around 2 percentage points from the World Cup and summer heatwaves.
Recurring services income was a standout, with flexpay adoption up 30 basis points year-on-year to 23.6% and iD Mobile subscribers up 16% to more than 2.7m, with the group now targeting at least 2.8m subscribers by year end. Currys said gross margin held stable on tight cost control, and it has completed £23m of its £50m share buyback while expecting year-end net cash to finish well above its £100m target.
"Currys has maintained its strong momentum, focus on margin, cost and cash discipline," said Fredrik Tønnesen, Chief Executive. The consistency of the subscriber and services growth alongside core retail gains suggests the group's diversification into recurring revenue streams is now a genuine earnings support, not just a talking point, reinforcing confidence in the buyback and cash targets it reiterated.
Eleco agrees £207.6m private equity takeover
Elecosoft Public Company (AIM:ELCO), the AIM-listed provider of software and related services to the built environment, has agreed to a recommended all-cash takeover by Accel-KKR at 235p per share, valuing its fully diluted share capital at approximately £207.6m and implying an enterprise value of £192.4m. The offer represents a premium of 74.7% to Eleco's closing price on 9 September and 89.9% to the six-month volume-weighted average price, implying a multiple of 20.2 times EBITDA and 31.9 times Cash EBITDA for the year ended 31 December 2025, a year in which revenue grew 20% to £38.8m and Adjusted EBITDA rose 32% to £10.2m.
Eleco has been transformed from a legacy building products manufacturer into a subscription-led software business, with recurring revenue reaching 81% of the total last year and annualised recurring revenue hitting a fresh record of approximately £35.5m at 30 June, alongside 15% organic revenue growth in the first half.
"Eleco has built a leading construction technology platform with a strong reputation among its customers through its domain expertise, and we look forward to partnering with the Eleco team to build on that foundation and support the company's next phase of growth," said Maurice Hernandez, Managing Director at Accel-KKR. The rich premium underscores how far Eleco's software pivot has been rewarded by private equity buyers hunting for recurring-revenue assets, and marks another AIM-listed technology name exiting public markets into sponsor ownership.
THG revenue and earnings beat first half guidance
THG (LSE:THG), the online nutrition and beauty group behind Myprotein and Lookfantastic, reported group revenue of £828.7m for the half year ended 30 June, up 7.2% year-on-year and above its guidance of 6.5% growth. Adjusted EBITDA rose 109% on a like-for-like basis to £42.8m, ahead of guidance of at least £40m, with THG Nutrition's margin improving 210 basis points to 5.2% group-wide; Myprotein sold 58.5m branded products in the half, up 57% year-on-year, and is on track to exceed 130m units for the full year.
THG Nutrition grew revenue 9.2%, or 12.1% excluding Asia, with gross margin improving 120 basis points to 44.6% on whey mitigation and channel diversification, while THG Beauty grew 5.9% with gross margin down 90 basis points to 38.8%.
"THG delivered a strong first half, reflecting our successful transition from a capex-intensive technology and consumer brands group into a highly profitable global leader in Nutrition and Beauty, focused on delivering sustainable growth in free cash flow," said Matthew Moulding, Chief Executive. The scale of the EBITDA beat, more than double last year's like-for-like figure, gives weight to management's narrative that the group's restructuring away from capital-intensive technology ventures is translating into durable margin improvement rather than one-off cost cutting.
Debenhams sells Sheffield distribution centre to Primark
Debenhams Group has sold its Sheffield distribution centre automation and lease to Primark for £90m, a deal the company says will cut net debt to near zero by its next year-end.
The disposal hands Primark a ready-made automated fulfilment facility in Sheffield, the same site underpinning its newly announced home delivery launch in Great Britain, while giving Debenhams a substantial balance-sheet reset that removes a major source of financial overhang heading into its next reporting period.
