Primark owner set to reveal slump in profits
PRIMARK owner Associated British Foods (ABF) is set to unveil a slump in sales and profits after the high street giant was hammered by the latest coronavirus lockdown.
The company is expected to reveal that it missed out on £1.1bn in sales over the six months to February as a result of further enforced closures to its stores, in an update to investors tomorrow.
However, many analysts are optimistic that the consumer giant will recover ahead of the market.
On Tuesday, shareholders will be keen to hear how Primark stores traded in their first week since customers were welcomed to stores again on Monday April 12.
Unlike many competitors, Primark has not been able to trade at all in the UK since stores shut as it continues to stand firm on its bricks and mortar strategy and avoided launching online.
In February, the retailer said just over one fifth of its stores - 77 sites, primarily in the US - were still able to trade, but the recent reopening of some economies will help spark further sales in the current half-year.
ABF is expected to reveal sales of around £2.2bn for the Primark business in the six months to February 27. However, this will represent a stark slump against its £3.7bn figure it posted for the same period a year earlier.
Analysts at Shore Capital have said that, although there is still uncertainty surrounding the pandemic, they are positive that the Primark format is “set to bounce back strongly”.
“ABF has shown remarkable agility and resilience through the pandemic and its excellent cash generative traits and strong balance sheet leave the Group very well placed for the future,” said Shore’s Clive Black and Darren Shirley.