Star-Spangled hangers: Primark sees 'significant' fall in losses at US stores
DUBLIN-headquartered retail chain Primark expects to post a "significantly reduced" operating loss at its US arm in the financial year that ends this week.
Primark owner Associated British Foods said that its American retail business continues to deliver strong sales growth, driven by what it said was "excellent trading" at its Brooklyn store that opened in July last year, as well as like-for-like sales growth at its existing US outlets.
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Primark, which trades as Penneys in Ireland, will open its tenth US store, in New Jersey, this autumn. It will open its first outlet in Florida, at Sawgrass Mills, later in 2020, and has also exchanged contracts on a store in Chicago.
The chain's sales for the financial year ending this week are expected to be 4pc ahead of last year at both constant currency and actual exchange rates. That increase has been boosted by increased selling space, offset by a 2pc decline in like-for-like sales growth.
It has also continued to buck the gloomy high street trend in the UK, where clothing and sales of items including footwear and accessories have been weak. Primark's sales there rose 3pc in the year, and dipped 1pc on a like-for-like basis.
But the strengthening US dollar and the recent sterling weakness will increase the cost of goods for Primark next year, warned Associated British Foods.
"We anticipate achieving some mitigation from reduced materials prices, the favourable effect of exchange rates in sourcing countries and better buying," it said.
Primark now has 373 stores around the world, and opened 14 new stores in the financial year, including four in the UK, three in Germany, two in Spain, two in France, and its first outlet in Slovenia.