Primark store expansion boosts festive sales
Fashion retailer Primark recorded a 4% increase in sales over the festive period buoyed by the continued expansion of store space.
In a trading update for the 16 weeks ending 5 January 2019, its parent company Associated British Foods (AB Foods) said sales growth was driven by increased retail selling space partially offset by a “modest decline in like-for-like sales”.
AB Foods said its UK stores “performed well” increasing its total clothing market “significantly”. UK sales were 1% ahead of last year for the period, in a market which overall declined year-on-year. It added that sales over the Christmas trading period exceeded its expectations.
Additionally Primark’s sales in Europe were 5% ahead of last year at constant currency. Sales growth was especially strong in France, Belgium and Italy, and AB Foods said performance strengthened in its second largest market, Spain, lessening the impact of soft trading continued in a difficult German market. The company also added it was “pleased” with a “strong US performance”.
During the period, Primark’s retail selling space increased by 0.3 million sq ft since the financial year end and, at 5 January 2019, 364 stores were trading from 15.1 million sq ft compared with 14.2 million sq ft a year ago.
Four new stores were opened in the period: Seville and Almeria in Spain, Toulouse in France and a city centre store in Berlin, Germany. In addition, in the UK, we relocated to larger premises in Harrow and the Merry Hill store was extended.
Commenting on the increased space AB foods said: “We now expect to open 0.9 million sq ft in this financial year. The opening of the American Dream shopping mall in New Jersey has been delayed and consequently our new store there will now open next financial year while our smaller store in Oviedo, Spain will close this spring. Our 160,000 sq ft store in Birmingham is expected to open in April and our first store in Slovenia later this financial year.”
Overall group revenue at AB foods was 2% ahead of the same period last year as the increase in sales at Primark was offset by a tough period at its AB Sugar arm.
