Primark sales woes underline the challenges facing retail
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Primark's owners have reported a rare plunge in retail sales during the crucial Christmas quarter, underlining the challenges facing even discount retailers in the tough economy. Associated British Foods (ABF) reported a like-for-like sales decline of 6% for Primark in the UK and Ireland over the 16 weeks to 4 January.
It said that while sales within the fashion-dominated business had held up over the festive season, the build up to December was mired by weak consumer demand and warm weather. Money latest: TV chef points finger over hospitality troubles. ABF said that as a result of the drag, it was now expecting "low single-digit" sales growth for the brand in 2025, down from a forecast for mid single-digit growth made in November.
That was despite growth in key emerging markets of the US, France, Spain, Italy and Portugal. The UK and Ireland account for almost half of Primark's revenues. Chancellor Rachel Reeves indicates she will overrule environmental objections to a third runway at Heathrow.
Borrowing hits a four-year high for December. Wage growth and jobless rate rising, official figures show. The company's bleak update chimes with the findings of an industry survey, released earlier on Thursday, which stated that the outlook for UK consumer confidence had plunged to a new low.
The British Retail Consortium's (BRC's) latest Sentiment Monitor showed declines in expectations for both the economy and personal finances. Please use Chrome browser for a more accessible video player. The retail lobby group has been among the loudest voices in opposing Chancellor Rachel Reeves' decision to pile £25bn of taxes on business in the budget - the vast majority through employer national insurance contributions.
