The Irish textile discounter Primark was able to maintain its growth path in the first quarter of the 2023/24 financial year. This emerges from an interim statement published by the parent company Associated British Foods Plc (ABF) on Tuesday.
In the 16 weeks before January 6th, Primark’s sales amounted to 3.38 billion British pounds (3.95 billion euros). This corresponded to an increase of 7.3 percent compared to the same quarter of the previous year. Adjusted for exchange rate changes, revenues grew by 7.9 percent; on a like-for-like basis they increased by 2.1 percent, not least thanks to higher sales prices.
Demand increases over the course of the first quarter
The clothing retailer had a “slow start” to the quarter due to the unusually mild autumn weather, but then delivered “strong Christmas business,” it said in a statement.
Primark owed the significant increase primarily to its international business. While sales in Great Britain only grew by 4.5 percent (like-for-like +3.8), the rate of increase in the other European markets was 8.1 percent (like-for-like +1.3 percent).
In the USA, thanks to numerous newly opened branches, sales even exceeded the previous year’s level by 45 percent. During the quarter, the retailer opened three new stores in France and the US, as well as one each in Spain and Poland.
Management does not expect any “significant disruptions” to the supply chain due to the Red Sea conflict
Inventories were in a “good position” at the end of the quarter, the company said. The situation in the Red Sea is being continuously monitored in view of the current military conflict, but no “significant disruption” to the supply chain is currently expected.
Thanks to a higher gross margin, the retailer sees itself “well insulated” against possible cost increases due to the conflict. Overall, management is therefore “more confident” about the development of the operating margin adjusted for special effects in the current financial year, the company explained.