Retailer revenue jumps by 17%

Dublin-headquartered discount clothing retailer Primark contributed almost half of parent group Associated British Foods’ total annual sales in the 12 months to mid-September.

The diversified UK conglomerate — whose interests span ingredients, retail, grocery, and agriculture — yesterday reported group revenue of £12.9bn (€16.5bn) for the 52 weeks to September 13. In constant currency terms, that figure was up by 1% on the previous year, while a 2% rise in both adjusted operating profit (£1.16bn) and adjusted pre-tax profit (£1.1bn) was also noted.

Underlying pre-tax profit was up by 18% to £1.02bn, while basic earnings per share were ahead by 30% on the prior year at 96.5p.

While lower EU sugar prices held back ABF’s earnings, group chief executive, George Weston said that all divisions outperformed their previous year comparisons.

Primark — which trades as Penneys here — opened 26 stores across Europe, during the period and saw revenue rise by 17% year-on-year to £4.95bn.

“This excellent result was driven by an increase in retail selling space, like-for-like sales growth of 4% and superior sales densities in the new stores,” said Mr Weston.

“The year was characterised by success for our autumn/winter and spring/summer ranges. Sales over the Christmas period were excellent and were boosted in the third quarter by warm weather, especially in the spring and early summer.”

Primark saw particularly strong like-for-like growth in the Iberian market, eight years after establishing a presence in Spain and Portugal, while early sales in France — where it began trading just last December — were described as “exceptional”.

“We have a very strong pipeline of new stores in Europe, extending over a number of years,” said Mr Weston.

Primark is set to expand into the US market, having already identified store locations in the north-east.

“Our strategy is to generate interest in, and awareness of, the Primark brand,” Mr Weston said.

The company has signed a lease for 70,000 sq ft of selling space in downtown Boston, with that store due to open late next year. It will be followed by at least another seven stores in the north-east region, including at the King of Prussia shopping mall in Pennsylvania — one of the busiest in the US.