Primark raises full year outlook after sales top expectations

imageStock Markets53 minutes ago (Jul 01, 2021 02:58AM ET)

(C) Reuters. FILE PHOTO: A Primark store is pictured in the Bullring shopping centre, after new nationwide restrictions were announced during the coronavirus disease (COVID-19) outbreak in Birmingham, Britain, November 4, 2020. REUTERS/Andrew Boyers/File Photo

LONDON (Reuters) -Associated British Foods on Thursday raised the full-year profit outlook for its Primark fashion business after sales at stores which reopened after COVID-19 lockdowns in its latest quarter beat management expectations in all markets.

The group said Primark’s revenue was 1.6 billion pounds ($2.2 billion) in the third quarter to June 19 after the reopening of all stores and the opening of seven new stores, up from 0.6 billion pounds in the same period last year.

It said a number of new sales records were set and the like-for-like performance was much improved on earlier periods during the pandemic, reflecting an increase in both confidence and willingness to spend by customers.

Primark’s like-for-like sales were 3% up on a two-year basis in the quarter, though volatility remained high and performance varied by region depending on the degree of COVID-19 restrictions still in place.

The group said data for the total UK clothing market, which includes online sales, for the seven-week period after reopening showed both volume and value share gains for Primark on a two-year basis.

AB Foods (LON:ABF) now has higher expectations for Primark’s final quarter sales and its forecast for full-year sales has increased accordingly.

Primark’s full-year 2020-21 adjusted operating profit, stated before repayment of government job retention scheme monies, is now expected to be broadly in line with 2019-20, versus previous guidance of “somewhat lower”.

AB Foods also owns major sugar, grocery, agriculture and ingredients businesses.

Its full-year forecast for group adjusted operating profit is now in line with last year’s outcome.

($1 = 0.7243 pounds)

Primark raises full year outlook after sales top expectations

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