ABF flags lower full-year profit, warns gas costs could further squeeze sugar unit next year
AI Market Summary
Associated British Foods guided to lower profits and flagged a further deterioration in sugar earnings next year, citing significantly higher natural-gas costs tied to the Middle East conflict and weaker European sugar selling prices. The update signals margin pressure and softer near-term fundamentals for sugar-linked pricing, while also reinforcing the role of energy input costs as a key volatility driver for European sugar producers.
Impact level
● Medium
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AI Insight · NCCOSUGAR2USD/USDTAI Insight
▼ Bearish
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Associated British Foods (ABF) expects profit to fall in the current financial year and warned its sugar division could see profits worsen further next year as the Middle East conflict pushes up natural gas costs. The company said sugar revenue fell 4% this quarter, mainly due to lower sugar prices in Europe. ABF added that gas costs are “significantly higher” and said this would lead to a “further deterioration” in sugar profitability.
