Penneys takes Covid hit but plans to invest in Cork City store

Penneys, Patrick Street, Cork. Picture: Denis Scannell

The owner of the Penneys said it plans to invest large amounts in the coming years including at its Cork City store, as it revealed the huge hit taken by the 37 stores it operates in the Republic from the Covid-19 crisis. 

It was the first time that parent Primark had broken out the figures in such detail from its group-wide sales. Primark in turn is owned by Associated British Foods (ABF).

The new accounts show that Penneys revenues for the 53 weeks to mid-September of just over €482.2m had fallen by 13% from its previous financial year. 

Despite the Covid-19 impact, the accounts disclose that the company repaid the €22.9m the business received in Covid-19 wage subsidy supports from the Government concerning store closures during the pandemic.

The directors said in the accounts the company plans to invest over €250m in the Republic in the next 10 years, including creating 700 more jobs and increasing sales space.  

This includes a €60m investment into the redevelopment of its Patrick Street store in Cork City and a €20 million investment in the Eyre Square Store in Galway. Other investment includes a new 43,400 sq ft store at the Square, Tallaght this Autumn and a relocated store in Dundrum Shopping Centre.

According to the accounts, the Penneys firm paid out cash dividends of €275m to ABF in January 2022.

Primark opened its first store in Dublin in 1969 under the Penneys name and has since expanded to operate a total of 380 stores in Europe and the US where it is known as Primark. 

Penneys and Primark do not operate online and sales were badly hit by the Covid-closures of stores worldwide. 

The bulk of revenues were made up of inter-company supplies of inventory at €1.61bn, the Irish retail revenues of €482.2m and revenues of Primark Way franchise income of €263.9m.

The Primark Way franchise is a business format which is developed and run from Ireland and provides Primark intellectual property, know-how and services to Primark businesses overseas.

Numbers employed by the firm last year increased by 237 from 6,039 to 6,275.

Staff costs increased marginally to €233.8m. At the end of September 18th last, Primark Ltd’s accumulated profits stood at €1.3bn.