Posted on April - 22 - 2010
Primark profits boost
Primark owner Associated British Foods said half-year profits jumped 20 per cent after another forecast-beating performance from the high street chain.
The group, which also owns household brands Kingsmill, Silver Spoon and Twinings, said Primark profits were up 18 per cent to £144m after new stores and an eight per cent rise in like-for-like sales lifted its revenues 19 per cent to £1.26bn.
Primark’s progress came despite the impact of the weak pound on the cost of imports, particularly those goods sourced in US dollars.
The chain operates from 196 stores across Europe and AB Foods said it expected to open another six stores in the second half of its financial year, including in Chester, Bury and Blackburn.
Overall profits for the group rose to £331m in the 24 weeks to February 27.
The performance benefited from a substantial rise in profits from its sugar businesses, including a very strong performance from the UK.
Chief executive George Weston said: “The investments made in recent years are now delivering very satisfying returns throughout the group.”
He said Primark was going from “strength to strength” after exceeding expectations in the first half of the year.
The Twinings, Ovaltine and Kingsmill grocery division grew half-year revenues by four per cent to £1.6bn, with operating profits ahead 53 per cent to £95m.
The division includes Leigh-based curries and pickles business Patak’s, which AB Foods bought for £105m in 2007.
The group said advertising for the brand drove strong UK revenue growth, while Patak’s exports were also well ahead of last year.
The launch of the Little Big Loaf boosted sales of Kingsmill, while its Burgen brand increased its share of the health market and Allinson consolidated its position in the premium wholemeal sector.
Silver Spoon also benefited from an increase in demand for home-baking ingredients, particularly the Cakecraft range launched last summer, unrefined cane sugars and Allinson flour.
The Twinings and Ovaltine brands both delivered a strong sales performance, helped by a higher level of marketing support in the UK, US and Australia.
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