Primark enjoys bumper festive UK sales thanks to heels and baggy suits

Strong sales of heels, baggy suits and knitwear propelled Primark’s sales ahead of expectations over Christmas as shoppers returned to city centres and consumer spending was more resilient than anticipated.

Sales at the cut-price fashion chain’s established stores rose by 11% in the four months to 17 January, compared with the same period a year before, as the owner, Associated British Foods (ABF), said it had sold more items of clothing while prices had also risen by about 8%.

In the UK, sales were up by 15%, nearly all of which was like-for-like growth, stripping out help from new store openings. It said the numbers of shoppers visiting city centres – which were hit during the pandemic by the shift to home working – were up strongly, having caught up with retail parks and shopping centres which bounced back more quickly.

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“Sales of heels are back to pre-Covid levels,” John Bason, the ABF finance director, said. He added that the overall clothing market was up 5% in the UK as people clearly had more money to spend than had been anticipated and were “out socialising and wanting to enjoy themselves” as well as returning, at least part-time, to the office.

Primark had catered to the trend for “dopamine dressing” with brightly coloured soft tailoring that could be worn to work and then on a night out. It also benefited from those seeking out warm clothing to wear indoors and out during the December cold snap.

The company had grown faster than rivals, Bason said, as it had invested in its stores and attracted shoppers looking to save cash by switching away from online shopping. “If you want home delivery and returns you will pay more than in Primark,” he said.

The retailer’s performance echoes similar experiences at Next and Marks & Spencer, which did well in stores, while the online specialists Boohoo and Asos reported sales falling back amid concerns about deliveries.

Primark does not sell online, but it said a new service enabling shoppers to buy children’s items on the internet for pickup in 25 UK stores had gone well while the option to check stock availability in particular stores had led to an 85% leap in website traffic and helped tempt shoppers back to the high street.

Total sales at ABF rose 16% as its groceries group – which includes brands such as Twinings and Kingsmill – as well as its sugar and ingredients businesses contributed to growth.

“Consumer spending has proved to be more resilient in this trading period than anticipated at the start of the financial year,” the company said in a statement.

It added that trading through January had been encouraging but warned “macro-economic headwinds remain and may weigh on consumer spending in the months ahead”.

Despite the better than expected sales performance, ABF said its profit expectations for the year remained unchanged – suggesting ongoing pressure from inflation.

The group said it continued to “encounter significant cost pressures” so that profit margins were likely to be down for the year, but it said “inflation has become less volatile and recently some commodity costs have declined”.

Bason said Primark would not put up prices until at least September but there was likely to be more inflation on food this year as energy costs remained high and the strength of the dollar made buying things overseas more expensive.