Primark saw a 9% rise in sales in the year that ends this weekend, all of which came from its expansion — particularly in the US and Europe. Sales from stores open at least a year were down 2% due almost entirely to unseaonably warm weather before Christmas and very cold weather in March and April.
The food side of ABF, which ranges from sugar to Twinings teas, broadly had a good year. It is here that the firm will gain from sterling’s weakness with about £500 million of its annual sales in currencies other than the pound.
ABF also said that its pension fund will swing from a modest surplus last year to a deficit of £200 million this year because of the fall in long-term gilt yields caused by quantitative easing.
However, Bason said that this was not particularly serious in the context of a fund with a total value of £4 billion.
Looking forward, while Primark margins will reduce, profits from sugar are likely to improve sharply in the coming year. Barclays is forecasting a 7% increase in sugar margins thanks to higher prices and lower costs for the UK sugar beet industry.
The company is also set to book a profit of about £250 million from selling its share of a sugar joint venture in China.
