The owner of Primark said its full year profits would be higher than previously expected, helped by strong sales of Barbie T-shirts, cargo shorts and boho dresses as well as price increases.
The company behind the budget clothing chain, Associated British Foods, said cargo shorts, linen blend T-shirts and sliders, as well as boho and paisley dresses and its Moroccan-inspired matching outfits for all the family had all sold well over the summer.
The black Barbie men’s T-shirt was the top searched item on the Primark website over the summer, as the Barbie movie became a smash hit at the box office. Makeup and moisturisers are also selling well.
“It’s been a good summer; the products have continued to hold up really well,” said the ABF chief financial officer, Eoin Tonge. Tourists and day trippers have been coming back to London and other big cities such as Manchester, Liverpool and Birmingham, and numbers are close to pre-pandemic levels, which meant Primark’s flagship stores were busier.
In the UK, like-for-like sales at Primark increased 7% in the past three months despite heavy rainfall, especially in July and the first half of August, while its stores in southern Europe suffered during record-hot temperatures.
Primark had announced 7% price rises for this summer and there are some slightly higher increases still to come in the autumn and winter, Tonge said.
Looking at the whole sector, he expects clothing prices on the high street to be roughly stable next year and said shoppers should not expect big decreases, because retailers are seeking to rebuild their profit margins.
Primark’s like-for-like sales rose 9% across all countries to £9bn in the year to 16 September and along with strong food sales, this means the group will slightly exceed its previous expectation of adjusted operating profit to be moderately better than last year’s £1.4bn.
ABF also produces sugar and makes well-known food brands such as Twinings tea, Ovaltine and Patak’s curry products. Its grocery business traded ahead of expectations.
Its profit margins are rising again as costs for materials and freight have eased and the dollar weakened, and Primark pushed through “selective price increases”.
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At the same time, it cut prices on some kids’ clothes, including long-sleeve T-shirts, zip-up hoodies and leggings for the upcoming autumn and winter as well as some baby outfits.
Primark’s UK trial of click and collect services, which lets shoppers order online and then pick up their orders at highstreet stores, in north-west England and Greater London has been extended from kidswear to womenswear.
Total full-year sales are forecast to be 15% ahead of last year, with the UK contributing 11% growth and Europe 18%.