Primark bucking the High Street trend by revealing positive numbers in annual report
By James Young | 6th November 2019
While others struggle and seem set to close down their retail estate, Primark appear to be bucking the High Street trends.
A store expansion programme has helped the retailer post a eight per cent increase in profits to £913 million for the year to September 2019.
Revenues across the retail arm of Primark's owner Associated British Foods were four per cent up to £7.792billion, the firm's annual report has revealed.
Earlier this year, Primark opened their largest ever store in Birmingham, which the company said had received an encouraging reaction from customers.
It also hit the headlines last month when some Primark products appeared on Amazon online.
Primark does not have a sales website and responded to say that the products listed had not been supplied by them and that in store purchasing was the way to get best value.
In a statement announcing the results, ABF said: Sales at Primark were 4.2% ahead of last year at actual exchange rates and 4.1% ahead at constant currency, driven by increased selling space partially offset by a 2.0% decline in like-for-like sales.
"Operating profit margin increased to 11.7% from 11.3% and, as a consequence, adjusted operating profit was 8% ahead.
"Primark performed well in the UK as we continued to deliver a significant gain in market share, with sales growth of 2.5% driven by a strong contribution from new selling space.
"Like-for-like sales declined by 1.0% but outperformed a weak total clothing, footwear and accessories market which includes online.
"We have been encouraged by our customers' reaction to our new store in Birmingham High Street which showcases our new food and beverage and beauty services in addition to our full product range."
Overall, Associated British Foods reported a two per cent growth in revenue to £15.8 billion with adjusted profit before tax, also two per cent up to £1.405billion.
Chief executive George Weston said: "The group delivered a resilient performance this year, with strong profit growth from Grocery and Primark which more than offset the profit decline in Sugar.
"We continued to pursue the opportunities to grow our businesses with a gross investment of over £800m.
"Next year the group is well-positioned for further progress, with the continued expansion of Primark, a material improvement in our Sugar profit and strong profit growth in Grocery."
"This year Primark celebrated the 50th anniversary of the opening of its first store, and I am pleased to report another year of strong progress and notable achievements.
"The expansion in selling space included Birmingham High Street, a showcase for our entire product range and innovative in-store experiences, and our first move into eastern Europe with the opening of a store in Slovenia.
"Our stores in the US performed very well and we have announced four further stores to open in the near future. Primark again demonstrated its track record for operational excellence with further improvements in buying and stock management."
Copyright 2019 Moose Partnership Ltd. All rights reserved. Reproduction of any content is strictly forbidden without prior permission.