20 Apr Shops are back, says Primark as sales of handbags and shoes soar
The company revealed that 30 staff have lost their lives to the virus. “We mourn them all,” said CEO George Weston.
Finance director John Bason senses a shift in the public mood compared to previous restarts of the economy. “Last time it was slippers and pyjamas” he told the Standard. The Oxford Street store is “almost normal” in terms of sales.
The return of foreign holidays would help boost sales of beachwear and other holiday items he said. Primark is a rare UK retail success story overseas, recently turning profitable in the US and planning to expand across Europe.
Overall, profits at the group fell 8% to £275 million in the half-year. Furlough allowed it to retain all 65,000 jobs. Revenue across the company fell 17% to £6.3 billion.
The store closures will lead to another £700 million of lost sales over the next six months, though nearly 70% of retail space will be open by the end of April.
A dividend of 6.2p is a third of what it was previously, but removes a City question mark over the company. The shares slipped 55p to 2404p, but are up from 1650p last October.
Primark remains under fire for its refusal to sell online, a mistake the pandemic highlighted say critics.
“Covid has hit certain sectors incredibly hard, Primark happens to be a high street retailer,” said Bason. “This has been hugely painful. But I don’t wish we were a different sort of business.”
Chris Beckett at Quilter Cheviot said: “Primark was clearly going to be a big beneficiary from the economic re-opening after a £3 billion hit to sales experienced during the pandemic. But while we saw pictures of queues outside many stores last week, it is pleasing to have confirmation that Primark stores generated record sales in England and Wales, some 40% of their total global selling space, in the first week after reopening, showing strong pent-up demand from consumers for value-for-money clothing. One week cannot demonstrate a trend, but the desire of consumers to go shopping in Primark stores is evidence that not everything has changed during the pandemic.”