Primark 11% sales growth gives a fillip to AB FoodsComments Off on Primark 11% sales growth gives a fillip to AB Foods
Primark has shrugged off concerns that the retailer was over-reliant on store openings, after new space caused sales to rise 11% in its first quarter.
Shares in parent Associated British Foods today fell 82p, or 3%, to 2612p, but finance chief John Bason said the firm was “confident in our retail proposition”.
ABF declined to give a figure but said UK same-store sales were “good”. Barclays put growth at 2%.
“The beauty of Primark is that we’ve not only got [growth in existing stores], we have store expansion,” Bason said.
However Bason did admit that womenswear spending had been softer, reflecting Next boss Lord (Simon) Wolfson’s belief that consumers are shifting spending away from fashion to leisure and experiences.
Group revenue at ABF, which also has big sugar and grocery businesses, rose 22%. Stripping out a boost from the weak pound, sales were 10% higher.
Sugar sales rose 22%, on rising prices and greater production in Africa. UK sugar’s performance will “improve substantially” across the year amid higher prices, lower beet costs and the fall in sterling, ABF said.
In the grocery business, sales of tea brand Twinnings grew strongly in the UK, North America and Australia.