This time last year, cost inflation was the biggest nemesis of Associated British Foods, but getting a handle on higher prices has put the owner of Primark on course to finish the year as one of the best performers in the FTSE 100. Yet its value credentials remain intact.
A recovery in margins could provide more fuel for the shares next year. At Primark, which accounts for almost half of group profits, the adjusted operating margin is expected to rise to 10 per cent this year, better than the 8.2 per cent recorded last year and closer to a pre-pandemic margin of 11.7 per cent.
The burdens of higher costs for raw materials, labour and freight hit profitability last year. However, absolute cost pressures
