Sales at value retailer Primark were “exceptionally strong” in its first half, with operating profit set to be boosted after strong like-for-like growth.
Primark’s parent company Associated British Foods (ABF) said sales in the 24 weeks to March 2 are now expected to be 25% ahead of last year at a constant currency, with like-for-like sales growing by 7%.
Sales were boosted by weak comparisons in an unseasonably warm autumn 2011 coupled with strong trading over the Christmas period.
ABF said operating profit margin was much higher than the same period last year helped by lower cotton prices and better trading. ABF added Primark’s margins would not benefit from lower cotton prices in the second half, although did not give a reason why.
During the period, Primark expanded its retail selling space by 700,000 sq ft through opening 15 new stores including its second on London’s Oxford Street. In total it will be trading from 257 stores and 8.9 million sq ft of selling space by March 2.
ABF said the pace of store openings would not continue for the remainder of this financial year but will pick up again in the next financial year. It expects to add a further 100,000 sq ft of space this year, mainly comprising the completion of the extensions of its Newcastle and Manchester stores.