Sales at Primark took a hit in autumn following a spell of unseasonably warm weather, but the fashion retailer still expects profit growth to pick up this year.
In the 24 weeks to March 3, Primark’s owner Associated British Foods (AB Foods) said like-for-like sales at Primark were expected to drop by 1%.
AB Foods attributed the decrease to “sales growth being held back by unseasonably warm weather in October”.
However, thanks to a strong festive period which saw Primark achieve record sales in the week before Christmas, sales in the 16-week period to 3 March grew by 1%, while UK sales at Primark are up 8% compared with the previous year.
AB Foods commented: “Primark is performing very well in the UK with sales 8% ahead of last year and a strong increase in our share of the total clothing market.
“This was driven by a 4% growth in like-for-like sales, an increase in selling space and the breadth of our consumer offering. Our business in the US continues to make progress.”
“We expect an acceleration in Primark profit growth in the second half as a result of an improvement in margin over the same period last year,” they added.
“This will be driven by better buying and some benefit of the recent weakness of the US dollar on purchases which will more than offset an expected return to a more normal level of markdowns, compared to the very low level achieved last year.”