Associated British Foods says half-year revenues increased 18% boosted by the “first class performance” of its Primark stores.
The group, which owns the discount fashion retailer brand and markets Silver Spoon sugar and Twinings tea, says revenue increased to £4.4bn in the 24 weeks to February 28.
Sales at its Primark stores increased 18% to £1.1bn while profits increased 10% to £122m. However, the group warns that profit margins will be hit in the second-half because of the weakness of sterling against dollar.
Despite soaring sales, the group’s adjusted pre-tax profit dipped 2% to £275m, hit by unfavourable US commodity contracts and customers trading down to cheaper products, hitting profit in its grocery division.
Martin Adamson, chairman of the group, says the performance of the business is “encouraging” given the economic background, adding that “the market positions of most of our businesses will stand us in good stead”.
The group is looking to open a further seven Primark stores in the UK and several more in Europe in the second half of its financial year.