PRIMARK shoppers are back in stores at near pre-pandemic levels – and stocking up on cold weather clothes so they can keep heating bills down.
For the year to September sales jumped 22% to nearly £17 billion at parent group ABF, which includes the Silver Spoon sugar arm.
Chief executive George Weston says customers are cautious.
“We are seeing a change in shopping behaviour,” he told the Standard. “Our footfall is up but the basket size is down, people are buying less, but coming into stores in greater numbers.”
“We have been selling a very large amount of cold weather colds -- hats, scarves, hoodies. That is about people wanting to leave the central heating off for longer.”
He added: “We are selling more Xmas items earlier in the season than we could expect too, people are spreading Christmas buying over more than one pay day.”
Profits jumped 43% to £1.35 billion, with dividends up 8% to 43.7p. The shares, down 23% to 1436p, are likely to recover somewhat today.
The company is going well enough to launch a £500 million share buyback.
Weston, at the helm of the company for many years, compares the present economic conditions to the 1970s rather than the 2007 banking shock.
There will be another year of inflationary pressures before things return to something approaching normal, he warns.
The group has taken a £1 billion hit from extra costs this year.
The statement to the stock market said: “We estimate that inflation increased costs across the Group by some £1bn in this year alone. The fact that the Group prospered is testimony once again to the agility and expertise of our people and to the strength of our business model.”
Footfall on Oxford Street is back to pre-pandemic levels, a sign that not all shopping will go online.
Richard Lim of Retail Economics said: “The retailer is well-positioned to benefit from consumers who are trading down and putting lower costs at the heart of their buying decisions.
Many shoppers are prepared to sacrifice perceived quality and the convenience of online delivery for lower costs and it’s driving people back into stores across parts of the sector. However, there’s a perfect storm of cost pressures facing the retailer from spiralling input and operating costs and the impact of a weaker pound and rising interest rates.”