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'Profit margins will be hit' – CEO, Primark
May '11
Owners of Primark, the UK based garment retailer, have warned of a fall in profit margins, mainly due to the hike in cotton prices.

Associated British Foods (AFB) said that in the six months ending on March 5, operating margins of Primark fell and attributed the same to rising costs of cotton and in absorbing the recent hike in VAT rates.

However, Primark will absorb the increase in input costs to the extent possible to provide the best value to customers, said, George Weston, Chief Executive – AFB.

Though margins are under pressure, Primark has reported a three percent rise in like-for-like sales in the six months to March and which have also improved since then, added Weston.

Primark manages 214 stores and in the six months ending in March, Primark unveiled 10 new outlets and six more will be opened in the second half. It also plans to open five new stores in Germany in the next ABF fiscal year.

Fibre2fashion News Desk - India

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