"Huge" day for Primark leaves rivals in shade

PRIMARK enjoyed a “blow-out” sales boom just before Christmas as it continued to show the rest of the High Street a clean pair of heels, increasing its already dominant share of the clothes and footwear market.

With rivals struggling, Primark said sales for the 16 weeks to January 4 were 4.5% ahead of a year ago. John Bason, the finance director of parent company Associated British Foods, said the Monday before Christmas Day on Wednesday was “huge”. “It was a blow-out, a fantastic day for us. In some stores we beat our own records,” he said.

Primark’s move into America, traditionally a graveyard for UK retailers, continues to expand, though the company didn’t give much in terms of detail, saying only that there was “sales growth” in the US. After a brutal period last year, ABF’s sugar business is back on the up, with sales up 7%.

Rain in the UK has affected production levels a little, but sugar prices are rising across Europe, which should be good for profits. The City was relieved at the resilience of the picture presented, and ABF shares rose 61p to 2616p, leaving the business valued at towards £21 billion.

Credit Suisse analyst Simon Irwin was upbeat. He said in a note to clients: “Given the weak Christmas reported by peers such as M&S and B&M this is quite a welcome surprise and is the first positive quarter since 2017.” He reckons the shares are a clear “buy” since ABF is “one of the few large cap stocks in our universe with solid growth prospects and upside to valuation”.

Primark now has a 17% share of the clothes market, well ahead of the next biggest player, M&S. It plans to open another 18 stores this year, including the first shop in Slovakia, Primark’s 15th country.

Sophie Lund-Yates, at Hargreaves Lansdown, said: “Primark is proof that not every retailer struggled this Christmas. “What’s most striking about Primark is it’s essentially an old school retailer. Lack of a meaningful online business makes the chain a high-street play, so the improvement to sales performance is even more impressive.”