Primark performs well in H1 as sales grow
Primark is to open a warehouse in the autumn in the Czech Republic
The UK apparel giant saw sales grow 16% at constant currency, driven by an 11% increase in retail selling space and high sales densities in stores opened during the last year.
As a result of the weakening of the Euro against sterling, total Primark sales are expected to be 12% ahead of the same period last year at actual exchange rates.
Like-for-like sales growth, however, was held back by the unseasonably warm weather in the autumn across northern Europe and the impact, on existing stores, of new store openings in the Netherlands and Germany. Nonetheless, total sales in northern continental Europe were well ahead of last year.
Operating profit margin in the period has been in line with expectations, although lower than last year as a result of a higher level of mark-down, the retailer said.
Primark also revealed plans to open a new warehouse in the autumn in Bor, on the western border of the Czech Republic, to service stores in Austria and Germany. Earlier this year, the retailer doubled capacity at its Torija warehouse in northern Spain, and extended its Mönchengladbach warehouse in Germany, increasing capacity by 60%.
ShoreCap analyst Darren Shirley, noted: “We estimate like-for-like growth through January and February at around 4%, after a small decline for the first 16 weeks.”
Group underlying trading remains in line with expectations and ABF said it expects to continue to expect a marginal decline in adjusted earnings per share for the full year.
ABF is expected to publish its interim results to 28 February on 21 April.
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