Strong trading levels at its Irish operations helped drive an estimated 9% rise in sales at discount clothing retailer Primark in its latest financial year.
The Associated British Foods (ABF)-owned retailer is headquartered here and trades in Ireland as Penneys.
Yesterday it said via a pre-close trading update that its full-year sales covering the 53 weeks to September 17 are expected to be 9% ahead of the previous 12 months on a constant currency basis.
“Like-for-like sales are expected to be minus 2%, affected by unseasonable weather — warm weather in the pre-Christmas period and a very cold March and April,” management said.
It said Penneys was a strong performer all year, with other places showing signs of recovery.
“Ireland delivered a strong performance throughout the year,” it said.
“Spain, France, and Austria traded well and the Netherlands and Germany improved. The UK performance was in line with the group and good trading in periods of more typically seasonal weather.”
ABF has interests including agriculture, ingredients, sugar and retail.
On a group-wide basis it said it expects its full-year operating profits and earnings per share to be ahead on a year-on-year basis.
While the earnings¦ per share growth is only likely to be marginal, that would still show significant improvement on initial targets, as the group had originally guided for no earnings decline.
“The underlying operating performance of the group has been ahead of our expectation in the second half and the further weakening of sterling during the period since the EU referendum has resulted in a translation benefit,” said ABF management.
The group said if current sterling exchange rates continue they will have both a positive and negative effect on ABF’s operating profits next year.
“There would be an adverse transactional effect on the profit margin on Primark’s UK sales, a favourable transactional effect on British Sugar’s margins and a translation benefit on group profits earned outside the UK,” it said.
ABF’s share price was down nearly 11%, in London, yesterday.
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