Primark’s low prices led to record Christmas sales for the retailer as Britons hunted for bargains amid the cost of living crisis.
The fashion chain, which does not sell its goods online, posted a 15 per cent increase in sales to £3.1bn for the 16 weeks to January 7, reaching a new high in the week leading up to Christmas Day.
Visits to stores increased considerably in big city centres as well as on high streets and in retail parks, the company said, following a slump in footfall during lockdowns.
“We’ve had a number of years where you’ve seen an increase in online [retail], but online has gone back over this period,” said finance chief John Bason. “As soon as you start to deliver to people’s homes, your prices are structurally higher. If you want a great time out, then come to Primark.”
The chain has long been one of the few high-street retailers to resist the shift to ecommerce. Last year it introduced a click-and-collect service in the UK for some items, but it remains dependent on consumers visiting its stores.
Online-only fast-fashion retailers such as Boohoo and Asos have struggled since the end of pandemic restrictions, and did not experience the same boost as high-street brands over the Christmas period. Boohoo said its revenues would decline about 12 per cent on its previous financial year.
Primark’s parent company Associated British Foods reported a 20 per cent rise in group sales to £6.7bn from a year earlier. The group, which also sells household staples such as sugar, bread and other ingredients, maintained its full-year guidance but said its adjusted operating profit and earnings per share would be lower than in the previous year.
ABF, which is controlled by the Anglo-Irish Weston family, said a stronger US dollar and price increases helped boost its profits.
Primark said that its like-for-like sales in stores worldwide were up 11 per cent. It will open 17 stores this year, including seven in the US and three in France. “Europe was a bit sluggish last year but now it’s come back,” added Bason.
Joshua Warner, market analyst at City Index, said: “Primark has performed ahead of expectations and had a strong Christmas period. Evidence suggests more shoppers returned to the high street over the holiday shopping season considering online shopping sites were plagued by disruption to deliveries.”
Analysts at Barclays wrote in a note that “brick and mortar is back”. They added that, “despite the gloom around disposable income”, Primark’s volumes were up thanks to its affordable offering.
The share price slipped 1.5 per cent in early London trading on Tuesday.
