Primark continues to defy the retail gloom with sales at its UK stores up nine per cent in the past six months
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Sales soar and profits up at Primark
By Paul RobinsSeptember 09, 2009
Primark continues to defy the retail gloom with sales at its UK stores up nine per cent in the past six months.
The discount fashion chain, which has its HQ in West Street, Reading, has upped its full-year profit forecast in the light of improved demand for its low priced goods.
Bosses at parent firm Associated British Foods (ABF) said Primark’s UK performance was achieved through “strong competitive position, its highly appealing merchandise and better weather than last year”.
But finance director John Bason claimed there was also an underlying shift towards buying cheaper clothes that would continue beyond the downturn.
“There’s a real change in people’s shopping habits, and certainly among 20 to 30 year old females, it’s a change for good,” he said, adding that there had been particularly strong sales of footwear and summer dresses.
The chain’s success is in contrast to declines reported recently by mid-market rivals such as Marks Spencer and Next.
Primark’s underlying sales growth, which AB Foods expects to be seven per cent over the year to September 12, also outstripped its international rivals.
Primark said it expects its operating profit margin to be lower than last year, due to the opening of its new UK distribution centre as well as sterling’s weakness against the dollar.
The retailer has opened six new shops this year, in Spain, Germany, Portugal and the UK, while closing two. This brings its total to 191 stores.
