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Primark warned of a small decline in same-store sales in the UK, its most important market, though it said that its troubled German operation had shown a “notable improvement” in its most recent quarter.
Across the whole of Primark, sales were up 4.5 per cent at constant exchange rates In the 16 weeks ended January 4. This was “almost entirely” due to new space. UK same-store sales fell slightly, though the company did not provide a number. Including the effects of new store openings, sales grew 4 per cent in the UK.
Primark owner Associated British Foods stressed that the fashion retailer’s share of the UK clothing, footwear and accessories market grew and that trading was “particularly good over November and December” — a contrast to other retailers, who have warned that the period between Black Friday and Christmas was a struggle.
Revenue in the eurozone was up 5.1 per cent “as a result of the increase in selling space and like-for-like growth”. The pick-up in Germany follows a period of investment in marketing to shift negative perceptions of the brand among German consumers.
The US business, which has also encountered teething troubles in the past, “delivered like-for-like sales growth in the period”.
The company expects to open 18 new stores in the current financial year, including its first outlet in Slovenia and a second store in Poland.
In AB Foods’ other divisions, sugar revenue was 7 per cent ahead of last year at constant currency, with increased EU sugar prices in particular set to drive “a material improvement” in the group’s sugar profits this year. The company’s operations in Spain and China will deliver substantially better results, it said, although domestic sales at South African venture Illovo were affected by lower consumption and increased imports.
Sales at the grocery business, whose products include Twinings teas and Dorset Cereals, were unchanged although margins improved.
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