Business Irish

Sunday 15 September 2019

Primark springs back from bad weather in May as sales advance

Popular: Penneys on Henry Street in Dublin
Popular: Penneys on Henry Street in Dublin
John Mulligan

John Mulligan

UNSEASONABLE weather in May dented like-for-like sales at Penneys' parent Primark during the 40 weeks to mid-June, according to owner Associated British Foods (ABF).

However, ABF said the Dublin-headquartered chain saw an improvement in sales last month, while trading at its new stores was "strong".

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It added that overall sales at Primark in the year to date were 4pc higher at both constant and actual exchange rates, as the chain continued to expand its selling space.

Primark's selling space has increased by a net 0.8m sq ft since the beginning of the financial year last September. By mid-June this year, 372 stores were trading from 15.6m sq ft of retail selling space, which compared with 14.7m sq ft a year ago.

During its third quarter, Primark opened nine new stores. They included premises in Bordeaux, France; Utrecht in the Netherlands; and its first store in Slovenia, in Ljubljana. Primark also opened an outlet in Belfast in April. That was in addition to a store the retailer opened in December in the city after a huge fire destroyed the landmark Bank Buildings.

In the UK, ABF said Primark sales growth recorded in the first half of its financial year continued into the third quarter, with the chain grabbing more market share.

Sales in the eurozone were also hit by the unseasonable May weather, but ABF said trading there recovered strongly in June. Spain, Italy, Portugal and France all recorded sales growth, but trading was weak in Germany.

In the United States, ABF said Primark had delivered "encouraging" like-for-like sales growth. In the next 12 months, it will open stores at locations in New Jersey and Florida, and has also signed contracts for a store in Chicago. It downsized its outlet in the King of Prussia mall in New Jersey during the period. The mall is the largest in the United States.

Primark accounts for about 60pc of ABF's annual profits. Controlled by the Weston family, ABF also owns a number of well-known grocery brands, including Ovaltine, Ryvita, Blue Dragon and Twinings. It has a significant sugar producing arm.

It said that group revenue from continuing businesses for the 40 weeks ended June 22 was 3pc ahead of the same period last year at constant currency and 2pc at actual exchange rates.

Irish Independent

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