[ad_1]
Primark owner Associated British Foods has warned of an impact from lost retail sales of more than £ 1bn (€ 1.2bn) if coronavirus closures force its stores to remain closed until the end of February. .
The budget fashion chain, which markets itself as Penneys in Ireland, said 305 of its 389 stores around the world are currently closed, which is expected to cost it £ 1.05bn in lost sales. A significant increase from the £ 650 million forecast at the end of December.
AB Foods said it now expects to see underlying mid-year earnings disappear, and the group predicts it will be “pretty much breakeven” compared to earnings of 441 million pounds the previous year.
But he said he could be facing a sales hit of £ 1.85 billion if his entire store has to close and stay closed until the end of March, reducing profits by another £ 300 million.
Primark has already seen £ 540 million in retail sales lost from store closings due to coronavirus restrictions in its key Christmas quarter, with sales dropping 30 percent in the 16 weeks to Jan.2. .
The group saw trade hit hard by the UK lockdown in November and the resurgence of restrictions in Europe, with no online businesses to turn to.
Current store closings account for about 76% of its retail space.
The group said it has been able to offset some of the business impact with overall costs reduced by 25% due to store closures.
“The impact of store closings on Primark’s performance is significant,” he said. AB Foods. “We now expect Primark’s full-year sales and adjusted operating profit to be somewhat lower than last year.”
AB Foods said trading had been strong while stores were open, with comparable sales falling 14% over the 16-week period.
“When we’re done with all this, people will want to go on vacation, they will want to throw a party and they will want to go shopping at Primark,” said CFO John Bason.
So far, the group has avoided steep job cuts amid the coronavirus crisis, and Bason said there were no plans for large-scale layoffs.
PA media
[ad_2]