- Primark’s operating profits increase 2% to £673m
- Like-for-like sales edge up 1%
- Parent company Associated British Foods reports a 30% drop in pre-tax profits
Value fashion retailer Primark has reported a rise in sales and operating profits despite struggles at parent company Associated British Foods.
Primark reported a 2% increase in adjusted operating profit to £673m for the year ended September 12. Sales during the period jumped 8% to £5.34bn.
Like-for-likes sales edged up 1% during the 52-week period, while total sales were up 13% on last year, driven by a 9% increase in retail selling space.
The fashon retailer said like-for-likes were held back “by the effects of a strong store opening programme in the Netherlands and Germany”.
Primark revealed “very high sales densities” came from stores opened in the past 18 months, especially those in France.
During the period the fashion retailer opened its first store in the US on September 10, a 77,000 sq ft at Downtown Crossing in Boston.
Primark has 1.5m sq ft of new stores planned for the next financial year, which will primarily be in northeast America, Spain and France.
Seven stores are planned for the US, totalling 400,000 sq ft.
Associated British Foods chief executive George Weston said: “The exciting expansion of Primark is very much on track with the addition of nearly 1m sq ft of selling space, the opening of our first store in the US at the end of the year, and the announcement that we will be opening in Italy next year.”
The retailer’s growth in sales and profits came against a backdrop of parent company Associated British Foods (ABF) revealing a drop in pre-tax profits of 30% to £717m. Sales on a constant currency basis dropped 2% to £12.8bn.
ABF blamed the profit fall on the “challenges of food commodity deflation and big movements in exchange rates”.