Investec has reiterated its 'hold' rating and 1,300p target price for Primark owner and sugar group Associated British Foods as the firm's pre-close trading update guided to full-year results slightly below forecasts.

"We read the FY as a little below our expectations at Group level, with the usual swings and roundabouts underneath," said analyst Martin Deboo. The slightly miss is due to weaker-than-expected profits in Ingredients.

The broker said that it expects its full-year earnings per share (EPS) estimate of 87.1p to be reduced to the "mid-85p level".

Nevertheless, Investec highlights the "strong" fourth quarter from Primark, which led to full-year like-for-like sales growth of 3%, ahead of the broker's 2% forecast. The Sugars division is likely to be in line with full-year estimates.

"The two principal Divisions of Sugars and Primark (75% of profits) appear to be more or less in line with our FY12E numbers. However we expect a £100m impairment charge in Australia and weak Ingredients to embarrass ABF a little this morning," Deboo said.

Shares were down 2.07% by 11:35 on Monday.

BC

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