Value fashion powerhouse Primark has posted a 15% revenue surge to £3.5bn in the year to September 15, driven by new store openings.
Parent company Associated British Foods called it an “excellent result” as like-for-likes advanced 3% in the period.
The retailer said UK sales were particularly strong during the summer while sales on the continent “remained buoyant”. It added that sales across new stores had exceeded expectations and the opening day of the new store in Berlin in July was the most successful ever, according to the retailer.
Current trading in the new financial year remains “encouraging”, Primark said.
Primark accelerated its store opening programme, with 19 new stores by the end of the financial year, adding 900,000 sq ft of selling space. Three new stores opened in the UK, 11 in Iberia and five in northern Europe, including four stores in Germany, adding 10,000 jobs to the UK and European economies. Primark now has a total of 242 stores.
Chairman Charles Sinclair said: “Primark’s rate of growth increased this year with sales of £3.5bn, more than double those of five years ago. It was particularly exciting to see new store openings in Germany greeted with the same degree of customer enthusiasm as that experienced in the UK, with Berlin setting a new Primark record for sales made on the first day of trading.
“The excitement that continues to be generated by each new store opening and the sales densities that we are achieving in continental Europe afford us the confidence to believe that Primark is capable of much further growth.”
In the new financial year, Primark has continued to open stores, adding another London store to its portfolio on Oxford Street and it has opened its first store in Austria.
Primark plans to unveil a further 12 new stores before Christmas, while by spring next year it will have finished expansion of its stores in Manchester, Newcastle and Mary Street, Dublin, using the new store design.
In the period, Primark has worked to improve its logistics network by opening a 425,000 sq ft depot in Mönchengladbach in west Germany in August, increasing its total warehouse capability to 2.7 million sq ft. This is expected to offer a “more flexible response” to its customers in northern Europe.
Primark posted operating margins at 10.2%, the same level as last year as it absorbed high cotton prices in the first half of the year, squeezing margins rather than passing them on to the customer. As expected, margins increased in the second half as cotton prices fell.
In the new financial year, Primark expects operating margins to further improve as it continues to benefit from lower cotton prices.