Primark to lose £1.5bn if shops remain closed
PRIMARK stands to lose £1.5billion if its stores have to stay shut until the end of March – after years of spurning an online operation.
Owner Associated British Foods said more than three quarters of the fashion chain’s shops in the UK and other parts of Europe are closed.
Sales in the last four months of 2020 tumbled 30 per cent on a year ago.
Primark does not have an internet arm to compensate for its lost high street business during lockdown. When all outlets were open sales were still down 14 per cent.
At its trading update yesterday, ABF said that if all the closed Primark stores remain so until February 27, it will suffer a £1.05billion hit.
However, finance director John Bason warned it could be £1.5billion if that continues until the end of March.
Although Primark is struggling, ABF’s food businesses, from sugar to Twinings tea, had all seen strong growth.
Elsewhere, online fashion giant Boohoo expects to smash targets as it cemented itself as a lockdown winner.
The Manchester-based business, which owns the Pretty Little Thing and Nasty Gal offshoots, saw group sales jump 40 per cent to £660.8million during the final four months of last year.
It now expects its sales for the 12 months to the end of February to rise by up to 38 per cent, beating previous guidance of 28 to 32 per cent.
Boohoo has already bought Karen Millen, Oasis and Warehouse and is reportedly interested in rescuing Topshop, the jewel in the crown of Sir Philip Green’s collapsed Arcadia empire.
The company also announced it is investigating suppliers, having banned a total of 64 so far, and was identifying alternative “ethical” partners. It comes after a probe last year into working conditions and low pay in its supply chain.