Flying the flag pays off at Primark as ABF breaks the £1bn barrier

 

Patriotic shoppers piled into the cut-price fashion chain Primark to celebrate the Jubilee and Olympics over the summer, helping send annual profits in owner Associated British Foods (ABF) past the £1bn mark for the first time, the company said yesterday.

The sales phenomenon saw the chain – whose performance put struggling Marks & Spencer in the shade – sell more than 7.5 million items emblazoned with the national flag during the summer, according to chief executive George Weston.

"It was the summer of the Union Jack," said Mr Weston. "My daughter bought a onesey, and I think I bought a shirt and a belt with a Union Jack on. It was a fashion statement, it was fantastic. Primark is a particularly good place to go to if you've got a celebration but you don't want to spend too much."

Primark's austerity shopping offer goes shows little sign of losing its appeal, with the average customer spending £17 on four and half items.

Its profits rose 15 per cent to £356m in the year to 15 September, on sales which have doubled to £3.5bn in the past five years. This – plus a great year from its sugar business – helped drive ABF's overall benchmark profits up 17 per cent to £1.08bn. The dividend is also up 15 per cent to 28.5p.

Mr Weston was also upbeat about prospects for the crucial festive season: "The autumn and winter ranges were well received and I'm confident about Christmas."

Management is also considering further expansion of the chain in the UK, where it has 157 of its 249 stores.

"Certainly I don't think that 200 is impossible, but there is also the possibility of extending existing stores as well," the chief executive added.

Martin Deboo, an analyst at Investec, said 2012 had been an "annus mirabilis" for ABF, which has sales of £12.3bn as well as 106,000 employees in 47 countries. Across the UK and Europe, Primark now employs 10,000 more people than it did a year ago and is thriving in austerity-blighted Spain as well as European powerhouse Germany. The company's new store in Berlin broke all trading records for an opening day.

Despite disappointments from ABF's ingredients business, which was hit by rising raw material prices, analysts expect the fashion chain to move from strength to strength.

Shore Capital's Clive Black said: "In the current year we expect decent momentum to persist from Primark with double-digit constant currency sales as the business consolidates its strong positions in core markets, develops the infrastructure and advances into new catchments, most particularly in Germany."

Voices
On the last day of campaigning before the polling booths open, the SNP leader has written to voters in a final attempt to convince them to vote for independence
scotland decidesIs a huge gamble on oil keeping First Minister up at night?
Arts and Entertainment
Rosalind Buckland, the inspiration for Cider with Rosie died this week
booksBut what is it like to be the person who inspires a classic work of art?
Life and Style
techApple has just launched its latest mobile operating software – so what should you do first?
News
A male driver reverses his Vauxhall Astra from a tow truck
newsThe 'extremely dangerous' attempt to avoid being impounded has been heavily criticised
PROMOTED VIDEO
Arts and Entertainment
Lionel Messi in action for Barcelona
filmSo what makes the little man tick?
Arts and Entertainment
tvReview: An undercooked end (spoiler alert)
News
i100
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Pharrell dismissed the controversy surrounding
musicThe singer said 'the last thing I want to do is degrade'
Sport
Cesc Fabregas celebrates his first Chelsea goal
footballChelsea vs Schalke match report
Arts and Entertainment
Toby Jones (left) and Mackenzie Crook in BBC4’s new comedy The Detectorists
tvMackenzie Crook's 'Detectorists' makes the hobby look 'dysfunctional', they say
Life and Style
fashion

Olympic diver has made his modelling debut for Adidas

News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant Birmingham

£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Recruitment Consultant - Soho - IT, Pharma, Public Sector

£20000 - £25000 per annum + OTE £35,000 first year: SThree: The SThree group i...

Sales Executive

£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week