Primark push boosts AB Foods

SALES at discount clothing chain Primark are gaining momentum despite growing evidence shoppers are tightening their belts in the run-up to Christmas.

Associated British Foods said like-for-like growth at the chain was likely to be 7% over the second half to 18 September, beating the 5% of the previous six months.

Finance director John Bason said: 'People are getting to know about Primark and once they go there to shop for the first time, they go back again and again.'

The boon from Primark means profits across the AB Foods business should now match the 10% growth registered in the first half - slightly better than expected.

In a trading statement, Bason said the group, which owns Twinings tea, had benefited from less cost pressure relating to raw material prices in its grocery arm.

Primark now operates 120 stores across the UK and Bason said the group would continue to look for new High Street sites to expand, particularly in the Midlands.

AB Foods will book a non-cash charge of around £15m in its full-year results this November after adopting FRS17 accounting standards for pensions.

The group's shares rose 7p to 657p.