New stores drive Primark sales despite like-for-likes shrinking

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Primark sales
// Sales at Primark in the year-to-date were 4% ahead of last year and driven by increased selling space
// This offset by a decline in like-for-like sales
// Performance was affected by “unseasonable weather in May”, but it regained ground in June

Primark’s impressive sales growth in the first half of the year continued into the third quarter, although like-for-likes were dented by poor weather in May.

The value retailer’s sales in the 40 weeks to June 22 were four per cent ahead of last year on a constant currency basis, driven by new store openings and an increase in market share.

This was partially offset by a decline in like-for-like sales.

Operating margin in the first half was 11.7 per cent, which was well ahead of the margin in the same period last year of 9.8 per cent.

Primark accounts for about half of the revenue and profit for parent company Associated British Foods (ABF).

It said in the UK, Primark’s total sales continued to grow in the third quarter and it recorded a further significant increase in market share.

However, UK underlying sales were dented by unseasonable weather in May, compared to much warmer temperatures in the same period last year, but it regained ground during a strong June period.

ABF’s overall results were buoyed by Primark, its retail business, driven by increased store numbers of the period.

The company said like-for-like group revenues for the 40 weeks period rose by two per cent year-on-year.

Excluding its sugar division, ABF saw like-for-like sales growth of four per cent.

The company expected Primark to deliver “good profit growth” by the end of the year.

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