Primark posts 7% increase in first-half like-for-likes as profits rise 55%

The 257-store fashion retailer said its performance in the 24 weeks to March 2 was “exceptionally strong”.

Total sales rose 24% year on year to £1.99bn.

Primark said the like-for-like growth benefited from weak comparitives during the unseasonably warm autumn of 2011. 

Primark chief executive George Weston added: “Trading over the Christmas period was good but has been weaker during the prolonged period of cold weather since the New Year.”

The retailer said it had benefitted from a substantial expansion of retail selling space and superior sales densities in its larger new stores. 

Trading in its stores in Germany, the Netherlands, Belgium and Austria was strong during the period although like-for-like growth in Spain was “held back in the short term by the large number of recent store openings there”, Weston said. 

The retailer will enter the French market for the first time next year.

Primark said it had added 13% of retail selling space since the 2012 half year in an “extremely active” period for store openings. However, Weston said this pace would not continue for the remainder of the financial year.

Weston said operating profit margin was much higher than in the same period last year, reflecting the benefit of lower cotton prices, a weaker US dollar and lower markdowns as a result of better trading. 

He added: “No further margin improvement from lower cotton prices is expected in the second half. Although dollar-denominated garment purchases for the balance of this financial year are already committed and the related currency exposure is covered, the recent strengthening of the US dollar against both sterling and the euro can be expected to put pressure on margins for the forthcoming autumn and winter ranges.”