Primark to introduce ‘selective’ price increases to offset pressures

The owner of Primark has said it will be forced to raise prices on “selective” products in its autumn/winter ranges.

Associated British Foods said its half-year sales and operating profit for the group returned to pre-Covid levels, in interim results for the 24 weeks ended 5 March 2022.

However, the company said measures to mitigate higher costs across all its businesses had been taken and there were “more planned.” 

The group, which is known for selling clothes at affordable prices, said it was committed to “ensuring our price leadership and everyday affordability, especially in this environment of greater economic uncertainty.”

Primark sales were up 59 per cent to £3.5bn, as shoppers bought new outfits for holidays and social events once more.

Due to inflationary pressyres, the firm said it was now anticipating a greater reduction than previously expected for its second half operating profit margin. However, the full year Primak margin would be some 10 per cent.

Its outlook for the year was “for significant progress in adjusted operating profit and adjusted earnings per share for the group,” notwithstanding the current inflationary pressures, ABF said.

The business described its food arm as “resilient”, as adjusting profit took a nine per cent hit to £330m in the period. ABF pointed to high input cost inflation, logistics challenges, and Covid-relayed staff absences. 

However, ABF said sales were up to £4.34bn, with sales and profit in its sugar division “well ahead”.