Associated British Foods boosted as profits soar almost half at Primark
By Neil Craven, Financial Mail On Sunday
PUBLISHED: 22:38, 20 April 2013 | UPDATED: 22:38, 20 April 2013
Primark is on course to become the main driver behind its parent group’s profits after a surge in international sales growth.
On Thursday, Associated British Foods will reveal a 44 per cent leap in profits to £222million at the discount clothing retailer for the first half of its financial year, say analysts. That means it contributes almost half of ABF’s profits and exceeds the contribution of the group’s sugar and grocery divisions, which own the Silver Spoon and Twinings tea brands.
Total profits before central costs are deducted are expected to rise 14 per cent to £468million. Primark accounts for about a third of ABF’s £12.3billion sales, with agriculture, sugar, grocery and ingredients accounting for the rest.
Main driver: Primark accounts for about a third of ABF's £12.3billion sales
Primark has embarked on an international expansion plan and has stores in Ireland, Spain, Portugal, Germany, Holland, Belgium and Austria. It is picking up trade as cash-strapped consumers look for discounts.
The growth comes against the background of a deteriorating market for many other chains'
The Business, Innovation and Skills Select Committee launched an inquiry last month into the state of the retail sector and the effects of the Mary Portas review commissioned two years ago.
The British Independent Retailers Association confirmed it had submitted its views to the committee by last Monday’s deadline. It is understood to have called for a review of the method of calculating business rate rises, which has led to above-inflation increases, and more help for independent shop owners to gain a foothold on the internet.