Primark adds to growth for Associated British Foods

Feb 26 2008 by Alistair Houghton, Liverpool Daily Post

PRIMARK owner Associated British Foods (ABF) said it expected to see “good growth” in its operating profits boosted by the clothing chain’s continued strong performance.

The positive update ahead of ABF’s interim results in April comes despite a fall in sugar profit in the UK and Poland, with the company under pressure due to poor crops and EU quota changes. ABF, whose other companies include Allied Bakeries and Twinings Ovaltine, said Primark sales and profit were “substantially ahead” of last year, reflecting an increase in selling space and a 4% increase in like-for-like sales.

Primark’s performance has compared favourably with rival Marks & Spencer, which reported a 3.2% fall in general merchandise sales for its third quarter.

The chain operates 173 stores with 5m sq ft of selling space in the UK, Ireland and Spain.

Its Church Street store in Liverpool opened in September.

Its opening was described by ABF chief executive George Weston as one of the most important events in Primark’s year. Meanwhile, AB Foods said its Kingsmill bakeries arm Allied had maintained the improvement seen since the middle of last year.

It has boosted its contribution to the company’s grocery division, with “continued improvement” and higher volumes. Rising wheat prices have been recovered through price hikes.