Penneys Owner Raises Full Year Outlook After Sales Top Expectations
Associated British Foods (AB Foods) on Thursday raised the full-year profit outlook for its Primark (which trades as Penneys in Ireland) fashion business after sales at stores which reopened after COVID-19 lockdowns in its latest quarter beat management expectations in all markets.
The group said Primark's revenue was £1.6 billion ($2.2 billion) in the third quarter to June 19 after the reopening of all stores and the opening of seven new stores, up from £0.6 billion in the same period last year.
It said a number of new sales records were set and the like-for-like performance was much improved on earlier periods during the pandemic, reflecting an increase in both confidence and willingness to spend by customers.
Primark’s Like-For-Like Sales
Primark’s like-for-like sales were 3% up on a two-year basis in the quarter, though volatility remained high and performance varied by region depending on the degree of COVID-19 restrictions still in place.
The group said data for the total UK clothing market, which includes online sales, for the seven-week period after reopening showed both volume and value share gains for Primark on a two-year basis.
AB Foods now has higher expectations for Primark's final quarter sales and its forecast for full-year sales has increased accordingly.
Primark's full-year 2020-21 adjusted operating profit, stated before repayment of government job retention scheme monies, is now expected to be broadly in line with 2019-20, versus previous guidance of "somewhat lower".
AB Foods also owns major sugar, grocery, agriculture and ingredients businesses.
Its full-year forecast for group adjusted operating profit is now in line with last year's outcome.