Primark profits soar 29% to £662m, sales jump to £5bn
Discount fashion chain Primark has grown profits by another 29% after a "magnificent" year in which its sales jumped to almost £5 billion.
The annual profits haul of £662 million comes a day before struggling rival Marks & Spencer is expected to report lower half-year profits.
Associated British Foods, which owns Primark, said the retailer's sales rose 16% to £4.95 billion after it opened new stores across Europe and lifted sales at stores open for more than a year by 4%.
It has built an estate of 278 stores and has more than 10 million sq ft of space in locations across Europe, including 164 shops in the UK. The chain is also rolling out plans to open stores in the north-east of the United States.
Overall, adjusted pre-tax profits at AB Foods - the FTSE 100-listed conglomerate which owns Ryvita and Ovaltine - lifted 2% to £1.1 billion as lower prices at its sugar division were offset by growth in its grocery, agriculture and ingredients units.
The group said Primark's trading was excellent, with strong autumn/winter and spring/summer ranges and a successful launch in France last December.
Chief executive George Weston said: "Primark's trading success and significant expansion delivered another magnificent year."
The group, which employs 118,000 across 47 countries, said its overall sales slipped 3% to £12.9 billion, largely due to a strong pound and falling food commodity prices.
It said the price of wheat, barley, corn oil and rice all fell during the year.
Associated British Foods, which owns Silver Spoon, said falling world sugar prices meant its sugar division posted an adjusted operating profit 56% down at £189 million.
It said previous high sugar prices in 2011/2012 were due to exceptional shortages, with the market now undergoing a restructuring in Europe which will continue to see prices fall next year.
At its grocery unit it said Twinings Ovaltine delivered strong growth, which in the UK was reflected in good progress in green teas and infusions.
It said sales and profits were ahead of last year at Allied Bakeries, which launched Kingsmill Great White in February supported by a TV ad campaign. The grocery division reported an adjusted pre-tax profit 20% higher at £269 million.