Value fashion retailer Primark has reported strong Christmas trading and double-digit growth for its first quarter.

Sales at Associated British Foods’ retail division - which includes just Primark - surged 16% for the 16 weeks to January 7.

ABF said the Primark sales performance was “exceptional”, with particularly strong trading over Christmas, after a slower start to the financial year stemming from a warm autumn.

The strong performance comes after rival Peacocks collapsed into administration yesterday.

The value retailer also said it has increased its selling space by 500,000 million sq ft since year end.

Nine new stores opened: two in Spain, three in Germany, one in Portugal, one in the Netherlands, and two in the UK including its flagship in Scotland, which opened on Princes Street in Edinburgh before Christmas.

Two concessions were opened in Selfridges stores in Birmingham and Manchester in the period, as first revealed by Retail Week.

Primark now has 232 stores, spanning 7.8 million sq ft.

Further openings are planned for the second half including three stores in Spain, in March. Capital expenditure on new stores and refits for the full year is expected to be similar to last year.

ABF’s total capital expenditure was lower than last year despite continued investment in new stores for Primark.

Operating margin was also lower than last year, as Primark had continued to absorb higher cotton prices. The benefit of the recent dip in cotton prices and lower input costs isn’t expected to be seen until the second half, it said.

ABF’s net debt as of January 7, at £1.4bn, was “a little” higher than last year, the company said.

Overall, ABF said its group trading results were in line with expectations, but that “economic uncertainty, particularly in the eurozone, and continued pressure on consumer disposable incomes are expected to remain key features of this financial year”.

Yesterday, Primark staff in Northern Ireland were close to calling a strike following a second year of pay freezes. Usdaw members, which cover 85% of workers in Primark’s eight Northern Irish stores, are being balloted on the potential action which closes tomorrow.