UK retailer Primark announces full year 2012 results
-Revenue £3,503m (2011, £3,043m)
-Adjusted operating pro?t £356m (2011, £309m)
-Adjusted operating pro?t margin 10.2% (2011, 10.2%)
-Return on average capital employed 19.2% (2011, 18.2%)
Primark is a major retail group employing 43,000 people. It operates stores in the UK, Republic of Ireland, Spain, Portugal, Germany, the Netherlands, Belgium and Austria.
It offers customers quality, up-to-the- minute fashion at value-for-money prices. Buying and merchandising teams in Dublin (Republic of Ireland) and Reading (UK) travel internationally to source and buy fashion items that best re?ect each season’s key fashion trends. Primark’s range includes womens wear, lingerie, childrens wear, menswear, footwear, accessories, hosiery and homeware.
Revenue was 17% ahead of last year at constant exchange rates. As a result of the weakening of the euro in the second half of the year, the increase was 15% when translated at actual exchange rates. This excellent result was driven by an increase in retail selling space and like-for-like sales growth of 3% for the full year.
UK trading was particularly strong during the summer and sales in continental Europe remained buoyant. Trading in newly opened stores exceeded expectations and the opening of the new store in Berlin in July saw our most successful ?rst day’s sales ever. Sales of the autumn/winter range in the new ?nancial year are encouraging.
The operating pro?t margin at 10.2% was level with that achieved last year. In the ?rst half margins were lower than last year re?ecting the absorption of high cotton costs and the increase in VAT in the UK, which we chose not to, pass on to customers. As expected, margins in the second half increased re?ecting the fall in cotton prices.
Operating margins are expected to improve further in the ?rst half of the new ?nancial year with the bene?t of lower cotton prices but will be partly constrained by the three percentage point increase in VAT rates in Spain from 1 September 2012. Operating pro?t at constant currency was 17% higher than last year re?ecting the strong revenue growth.
At actual exchange rates pro?t was 15% ahead. Primark continued to make signi?cant progress with its ethical trade programme during the year. A member of the Ethical Trading Initiative (ETI) since 2006, it is now ranked at ‘Leader’ level which is the highest status achievable.