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Primark’s parent company, Associated British Foods (ABF), expects like-for-like sales for Primark UK to fall by around 2% in the second half of the year, with total sales to be around 0.5% lower.
This follows a like-for-like decline of 0.6% in the third quarter, which is projected to drop further to roughly 3.1% in the fourth quarter.
The fashion retailer has attributed its UK performance to subdued footfall in shopping centres due to “challenging” weather conditions, particularly in April and June.
However, Primark’s revenues growth is expected to be around 4% in the second half, primarily driven by a strong sales contribution from the group’s continued store expansion programme.
In Europe – excluding the UK – sales growth is expected to be around 5% in the second half, with a strong contribution from space expansion.
According to Primark, most European markets have delivered strong growth in the second half, including Spain, France and Italy.
As a result, like-for-like sales growth is expected to be around 0.9% in H2, with growth of 1.1% in Q3 and projected growth of around 0.7% in Q4.
There were eight new store openings during the period – three in Spain, two in Italy, one in Ireland, one in Romania, and Primark’s first store in Hungary.
George Weston, CEO of Associated British Foods, said: “While the British weather was not in Primark’s favour this summer, robust growth in other markets and new store openings have driven good sales overall. Strong margin delivery is enabling increased investment in our product, digital and brand initiatives.”
Overall, ABF’s outlook for adjusted operating profits for Primark in FY24 is unchanged, as its margin delivery has been strong in H2. The group now expects adjusted operating profit margin for the full year to be a little over 11.5%.
