Associated British Foods downgraded the annual sales guidance for its Primark budget clothing business on Thursday after disappointing results in the Christmas quarter in its main UK and Ireland market.

The conglomerate lowered its sales-growth expectations for Primark —its clothing retailer that accounts for the lion’s share of earnings—amid a challenging retail environment.

ABF said Primark had delivered “good growth” in continental Europe and the US, but that the fashion chain’s sales in the UK and Ireland — which account for almost half of the total — fell by 4 per cent in the 16 weeks to January 4. Like-for-like sales were down 6 per cent in the period.

Associated British Foods expects analysts' consensus profit expectations for its 2024/25 year to fall about 2% after the group cut the sales outlook for its Primark clothing business, its finance chief said on Thursday.