60% of Penneys-Primark Europe retail space hit by Covid closures

Penneys, The Mall, Tralee, Co Kerry, one of 36 Irish stores, and 153 in England, which are being temporarily closed this week due to the pandemic. Picture: Domnick Walsh © Eye Focus

The temporary closure of 36 stores in the Republic of Ireland and the anticipated shuttering of 153 outlets in England this week will mean that almost 60% of all Penneys-Primark retail space will be shut during the second wave of Covid-19 lockdowns across Europe, at a cost of £375m (€417m) in lost sales, its owner has revealed. 

Penneys-Primark, which has its head offices in Ireland is owned by Associated British Foods (ABF), and was one of the fastest-growing clothes retailers despite the crisis facing many other fashion retailers even before the onset of the Covid-19 crisis.  

However, in an update, the retailer revealed that the stores which are already shuttered during the new Covid shutdowns in Europe, including those in in the Republic, in France, Belgium, Wales, and Catalonia in Spain, as well as Slovenia, account for almost a fifth of its total retail selling space.

Uncertainty about further temporary store closures in the short term remains

With store closures in England under the new health measures anticipated there later this week, temporary store closures across Europe will then account for 57% of all its retail space, ABF said. 

"Trading hours are also restricted in a number of other markets. Uncertainty about further temporary store closures in the short term remains," it said. 

The Penneys-owner said, however, that before setting aside money to pay the rent on its leases, it holds net cash reserves of £1.55bn and has billions in liquidity.      

And despite the temporary closures of the Penneys-Primark stores, "all orders placed with our suppliers will be honoured", it said.         

ABF also owns a large range of grocery items, including Twinnings, Ovaltine, Ryvita, Jordans, and Silver Spoon. Its London-listed shares, which rose slightly in the latest session, have nonetheless been badly hit since the onset of the Covid crisis in March, and are down 21% from a year ago. The stock market values ABF at over £12.9bn.