Primark profits 'well ahead', figures show

Primark profits 'well ahead', figures show

First-half sales at Dublin-headquartered discount clothing retailer Primark - are expected to be 4% up on last year. The company trades here as Penneys.

Figures for the six months to the start of March are scheduled to be announced towards the end of April and should show Primark’s performance was boosted by increased retail selling space. However, revenues are expected to have been partially offset by a 2% decline in like-for-like sales.

The company said first- half profit is expected to be well ahead on a year-on-year basis and said early trading of its new spring/summer ranges has been “encouraging”.

In a trading update, last month, a spokesperson for Primark said the retailer was pleased with the trading performance of the Penneys business in the current financial year.

Primark’s owner is retail and commodities group Associated British Foods. It forecast flat group earnings for the first half.

It said it would deliver first-half revenue growth in all of its businesses, other than sugar, helping it to deliver earnings per share broadly in line with the previous year. However, it said it expected a small reduction in adjusted operating profit.

Associated British Foods described as “unbelievable” the notion that the British government is contemplating leaving the EU next month without a deal to smooth its exit.

With only 32 days until the UK is due to leave the EU, the British parliament is deeply split over how, or even whether, the country should leave the bloc.

The finance director for AB Foods John Bason said the uncertainty was impacting the group’s current operations, noting it had packaged grocery products exports in transit on the sea.

“We don’t know now whether they will be considered to be an import from the EU or from a country that they haven’t got a trading relationship with. For it even to be contemplated, a hard Brexit where you’ve got no arrangement with your major trading partners and when we’re so reliant on them for the food supply chain, I find it unbelievable,” he said.

“The consequences of getting this wrong for people are major and I want people to understand that”, Bason said, adding that a hard Brexit would be “irresponsible”.

The group owns food brands such as Ovaltine, Ryvita, Twinings and Jordans. It also owns major sugar, agriculture and ingredients businesses.

- Additional reporting Reuters

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