Associated British Foods, the owner of Primark, has credited strong Christmas trading at the budget fashion brand for an increase in sales of 7.9%, despite “a slow start given the unseasonal warm weather”.
In the the 16 weeks to 06 January 2024, Primark saw like-for-like sales grow by 2.1% driven by higher average than selling prices. Sales of womenswear and menswear were strong, with Christmas ranges and a collection with singer Rita Ora proving popular. However, cold weather categories were slow until the recent cold snap.
In the UK, total sales in the period rose by 4.5% with like-for-like sales up by 3.8%. While, in Europe total sales in the period rose by 8.1%, with like-for-like sales up by 1.3%.
ABF did admit that performance was mixed with some countries trading well and other countries impacted by local economic conditions, with some underperforming in comparison to last year.
Sales in the US grew by 45% in the period driven by new store openings. There were three new locations opened in the states, with three in France, one in Spain, and one in Poland.
ABF also stressed that it has good stock levels, despite the Red Sea crisis. The group will continue to monitor the situation, but at this stage do not expect any significant disruption to its supply chain.
Looking ahead, the statement read: “We feel more confident in the delivery of the Primark adjusted operating margin in this financial year, driven by a further improvement in product gross margin. This should insulate us well against potential additional costs of supply due to the disruption in the Red Sea should they arise.”
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