Companies

Primark ends full year on growth path

Nov 6, 2024 United Kingdom

Primark’s parent company reported solid results for its latest full year. Sales at the fashion retailer grew by 6% year-on-year, underpinned by solid performances in key growth markets

“Primark achieved good sales growth this year, and I am particularly pleased with the significant recovery in margin. Our low-cost model is as strong as ever, as we maintain our relentless focus on delivering great-value clothing and a unique store experience. This is underpinned by a step up in investment in strategic initiatives across digital, product and brand”, commented George Weston, Chief Executive of Associated British Foods, the parent company of the fashion retailer.

In the financial year ended on the 14^th of September, Primark recorded a revenue growth of 6% on a constant currency basis to 9.4 billion British pounds (11.3 billion euros), as compared to the previous financial year, reflecting strong performance in key growth markets, as well as growth in its largest market, the UK.

On a comparable basis to the prior financial year, full year sales at Primark grew by 6% in Spain and Portugal (17% of total sales), by 12% in France and Italy (16% of total sales), by 3% at Northern European markets (13% of sales), by 43% at Central and Eastern markets (3% of total sales), and by 30% in the US (5% of sales). In the UK and Ireland, which accounted for 47% of total sales, they increased by 2% as the adverse weather conditions in the second half of the year impacted its performance.

On the 14^th of September, the fashion retailer operated 451 stores in 17 markets, having opened 22 stores during the year. “We continue to see significant white space opportunities in our growth markets in Europe and the US, and we have a clear roadmap for new store rollouts over the medium and long term to drive sustainable growth”, ABF stressed.

Primark recorded a full year adjusted operating profit of 1.11 billion British pounds (1.3 bilion euros), an increase of 31% as compared to the previous financial year, and an adjusted operating profit margin improvement to 11.7% from 8.2% in 2023. This strong operating performance reflects an increase in gross margin, mainly due to lower material costs and lower realised freight costs, as well as the annualisation of prior year price increases.

For 2025, the retailer is targeting mid-single-digit sales growth and an adjusted operating margin broadly in line with this year, as gross margins stabilise and the company increases investment to drive sustainable growth.

ABF Results

In the last financial year, Associated British Foods posted revenue growth of 4% on a constant currency basis to 20.1 billion British pounds (24.1 billion euros), as compared to the same period of the previous year, driven by both retail and food businesses.

Its adjusted operating profit increased by 38% year-on-year to 2.0 billion British pounds (2.4 billion euros), reflecting a strong margin recovery to 10.1% across the group. Adjusted earnings per share were up by 39% year-on-year to 196.0 pence (0.24 cents) and basic earnings per share increased by 44% year-on-year to 193.7 pence (0.23 cents).

1 GBP = 1.20 EUR

Image Credits: corporate.primark.com

United Kingdom Fashion Primark Results Year Results