Primark sales spike 36% to £2.67bn
The operating profit margin in the period was ‘ahead of expectations’ despite total sales falling 11% year-on-year.
Primark owner, Associated British Food (ABF), has announced the fashion retailer’s revenues increased by 36% to £2.67bn in the 16 weeks ending 8 January 2022, compared to £2.03bn in the 16 weeks ending 2 January 2021.
Total Primark sales this period were 5% lower than pre-Covid levels, and like-for-like sales were down 11%, although UK sales reportedly improved in the final quarter of FY21.
Stores in retail parks and town centres continued to outperform destination city centre stores, with like-for-like sales in retail parks ahead of pre-Covid levels.
Additionally, the company’s operating profit margin in the period was “ahead of expectations” and is expected to be over 10% at the half year.
Trading was reportedly impacted by a decline in footfall as a result of the rise in Omicron cases, but the company said trading has improved in recent weeks.
Meanwhile, like-for-like sales in Continental Europe fell 14% below 2020 levels, with footfall impacted by high levels of Omicron infections. ABF said it estimates a sales loss of some £30m, relating to the short periods of store closures in Austria and The Netherlands during the period.
Since the start of the pandemic, ABF has opened 25 stores, lifting its retail selling space by 7%. The company also proposes to “simplify” its in-store UK retail management structure as part of its ongoing programme to “improve the efficiency” of its store retail operations.
ABF said: “The pressure of disruption to the supply chain we experienced in the autumn has alleviated, although we are still experiencing some delays in dispatch at ports of origin and we expect longer shipping times to continue for some time.
“We are also on track to launch our new, improved customer-facing website in the UK by the end of March, and across all our markets by the autumn. The new website will showcase many more of our products and will provide customers with product availability by store.”
It added: “It is difficult to predict future trading conditions with certainty, but we have seen an encouraging improvement in footfall in the UK and Ireland as the disruption from Omicron reduces. Looking ahead, we expect Primark sales from now to April to be significantly better than sales in the comparable period in the last financial year.”
