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.

Primark, the international fashion retailer, has cut its sales forecast for this year after a weak performance in its core UK market. Associated British Foods, the parent of Primark, said in a trading update on Thursday it was now targeting “low” single-digit sales growth for the fashion chain in 2025.

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.

Primark has cut its sales forecasts after the high street chain’s UK shops were knocked by “cautious” shoppers and unfavourable weather. Parent firm Associated British Foods (ABF) revealed a slump in sales in the UK in recent months amid continued pressure on household budgets.