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Primark profits surge 30% after ‘magnificent year’ Primark profits surge 30% after ‘magnificent year’
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Primark enjoyed a “magnificent year” with profits racing ahead by 30% as it expands its cheap fashion retail empire abroad.Primark enjoyed a “magnificent year” with profits racing ahead by 30% as it expands its cheap fashion retail empire abroad.
The retailer’s relentless growth was not even dented by this autumn’s unseasonably warm weather, which has hurt high street rivals as shoppers delay buying jumpers, jackets and coats. Last week, Next, one of the UK’s most successful retailers, and SuperGroup were forced to issue profits warnings, as sales dipped in the warmth of a prolonged indian summer. Sales at Primark were up 10% in the six weeks from mid-September, following the end of its financial year. George Weston, chief executive of Primark’s parent company Associated British Foods, said he was not concerned about the weather, adding that the retailer had not delayed or cancelled any orders. The retailer’s relentless growth was not even dented by this autumn’s unseasonably warm weather, which has hurt high street rivals as shoppers delay buying jumpers, jackets and coats.
Primark’s annual sales are now close to £5bn, having risen 17% in the year ending 17 September, mostly as a result of the addition of 1.4m sq ft of shopping space by expanding abroad. Operating profits soared to £662m, a 30% rise. Excluding new stores, sales were up 4% on last year. Last week, Next, one of the UK’s most successful retailers, and SuperGroup were forced to issue profits warnings, as sales dipped in the warmth of a prolonged Indian summer. Sales at Primark were up 10% in the six weeks from mid-September, following the end of its financial year.
The retail chain opened its first stores in France last year, with three stores in the Paris suburbs and one each in Marseille and Dijon. The fashion retailer, which now operates in nine countries, announced earlier this year that it plans to open its first store in the US, with the first outlet, in central Boston, due to open at the end of 2015. George Weston, chief executive of Primark’s parent company, Associated British Foods (ABF) , said he was not concerned about the weather, adding that the retailer had not delayed or cancelled any orders.
Primark’s heady pace of expansion bolsters parent company ABF, grappling with lower sugar prices that have reduced profits in a core part of its business. Earnings from sugar fell 22% to £2.01bn last year, slashing profits by 54% to £189m. World sugar prices are falling, amid more competition in Europe as quotas are phased out. Primark’s annual sales are close to £5bn, having risen 17% in the year ending 17 September, mostly as a result of the addition of 1.4m sq ft of shopping space by expanding abroad. Operating profits soared to £662m, a 30% rise. Excluding new stores, sales were up 4% on last year.
The retail chain opened its first stores in France last year, with three in the Paris suburbs as well as one in Marseille and another Dijon.
The fashion retailer, which operates in nine countries, plans to open its first store in the US, with the first outlet, in central Boston, due to open at the end of 2015.
Primark’s heady pace of expansion has bolstered ABF, which is grappling with lower sugar prices that have reduced profits in a core part of its business. Earnings from sugar fell 22% to £2.01bn last year, slashing profits by 54% to £189m. World sugar prices are falling amid more competition in Europe as quotas are phased out.
The strong pound also weighed on ABF’s earnings and profits. The group reported revenues of £12.9bn for its last financial year, 3% down in real terms, although up 1% when based on the average exchange rate. Basic earnings per share rose 30% to 96.5 pence and pretax profits were up 18% to £1.02bn.The strong pound also weighed on ABF’s earnings and profits. The group reported revenues of £12.9bn for its last financial year, 3% down in real terms, although up 1% when based on the average exchange rate. Basic earnings per share rose 30% to 96.5 pence and pretax profits were up 18% to £1.02bn.
Weston said all parts of its business, which spans groceries, agriculture, ingredients and retail, had outperformed last year. “Primark’s trading success and significant expansion delivered another magnificent year,” he added. Weston said all parts of its business – which spans groceries, agriculture, ingredients and retail – had outperformed last year. “Primark’s trading success and significant expansion delivered another magnificent year,” he added.