Primark expects 60% sales hike

Primark-owner Associated British Foods (ABF) expects sales at the fast fashion retailer to be much higher in the latest half year than in 2021.

The British multinational said it predicts across the 24 weeks to 5 March 2022, sales will be 60 per cent higher than the previous year.

The interim results are scheduled to be announced in April.

Primark is also expecting an operating profit margin of 11 per cent – bringing the half year margin close to pre-pandemic levels. The company said this is because all of its stores remained open throughout the period except for short periods in Austria and The Netherlands.

“The effect of inflation on raw materials and the supply chain in Primark this first half has been broadly mitigated by a reduction in store operating costs and overheads and a favourable US dollar exchange rate,” said the company in an update.

The discount retailer believes UK like-for-like sales will have improved significantly during the six-month period, reaching around 9 per cent lower than pre-covid levels. Total sales are expected to be 8 per cent below two years ago.

Recorded sales in Continental Europe were also ahead of last year. Like-for-like sales for the period are expected to be 14 per cent below two years ago, which the company said reflected the continued impact of Omicron on customer footfall.

The company's US business is vastly outperforming Europe; on track to deliver two per cent like-for-like sales growth in the period compared to pre-COVID levels with total sales 35 per cent ahead of two years ago.

ABF added that the deployment of Oracle's stock management system across its stores is "progressing well". It expects all stores to be equipped with point of sale terminals by the end of 2022.

Primark also has plans to launch a new website in the UK by the end of next month and across all markets by Autumn. The new site will showcase more of its products and product availability by store.

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