Despite experiencing double-digit growth in countries such as Spain, Portugal and the US, Primark's performance was dragged down by lower sales in the º£½ÇÊÓƵ and Ireland in the last quarter of 2024.
This morning, ABF Foods, Primark’s parent company, informed markets that sales in the º£½ÇÊÓƵ and Ireland, which makeup roughly 45 per cent of its market, fell four per cent in the 16 weeks leading up to 4 January, as reported by .
The retailer attributed this decline to weaker sales of cold-weather and seasonal clothing, as well as cautious consumer sentiment. .
Across the º£½ÇÊÓƵ, shops have been warning that poor consumer sentiment about the economy has discouraged spending in the last quarter of 2024. According to the British Retail Consortium (BRC), overall sales in the º£½ÇÊÓƵ grew just 0.3 per cent in the 'golden quarter', which includes Black Friday, Cyber Monday and Christmas.
The BRC has forecasted that sales growth will average 1.2 per cent in 2025, although this is below the projected shop price inflation of 1.8 per cent.
Overall like-for-like sales at Primark dropped 1.9 per cent, reflecting the lower sales in the º£½ÇÊÓƵ and Ireland despite expansion in mainland Europe and the US. ABF reported that sales in France and Italy grew 16 per cent, while sales in central and eastern Europe increased by 22 per cent.
Sales in Spain and Portugal rose by nine per cent, but trading in Spain was impacted by significant flooding in Valencia, causing store disruption, with one store still remaining closed.
In the US, ABF reported a 17 per cent increase in sales and opened two new stores over four months, bringing its total to 29. Analysts at Jeffries noted that despite a dip in domestic sales, the steady guidance should lead to a "relief rally".
However, they cautioned that "ongoing uncertainties surrounding Primark’s profit potential are not conducive to a sustained rebound". ABF expressed confidence in Primark's future "despite the market conditions in the º£½ÇÊÓƵ and Ireland".
In other areas of the business, grocery revenue saw a one per cent rise, bolstered by international performance of Twinings and Ovaltine, while sugar and agriculture sales experienced declines of two and four per cent respectively.
