Adjusted operating profit at Primark surged by 25% to £426 million in the first half of its financial year as the retailer benefited from higher margins. Operating margin in the first half was 11.7%, which was well ahead of the same period last year when the margin was 9.8%.
While like-for-like sales fell by 1.5% overall, revenue climbed by 4.4% due to an increase in retail selling space.
In the UK like-for-like sales edged up 0.6% with total sales coming in at 2.3% ahead of last year. Primark owner Associated British Foods said the impact of low footfall in the UK in November was balanced by good trading in other months of the first half.
Like-for-like sales in Primark’s Eurozone dropped by 3.2% after the retailer saw a decline in footfall in November across all of its markets. Total sales in the region were 5.3% ahead of last year at constant currency. ABF said trading in Germany is continuing to be difficult, although Primark has strengthened its management team in the country to address this.
ABF said Primark’s strong performance in the in the US was driven by” excellent” trading at its newly opened Brooklyn store.
George Weston, ABF chief executive, said: “Primark delivered excellent profit growth, driven by further development of our customer experience and selling space expansion."
