Primark and carpet group lift hopes of recovery

Primark’s like-for-like sales increased by seven per cent in the 24 weeks to the start of March while Carpetright reported a 5.6 per cent rise in like-for like sales in the 12 weeks to April 20.

Primark’s owner, Associated British Foods, believes the discount clothing chain will be Britain’s fastest growing major retailer this year.

A 55 per cent jump in Primark’s operating profit in the six months to March 2 drove a 20 per cent rise in ABF’s group total to £496m, beating analysts’ forecasts.

ABF’s chief executive George Weston said: “Seven per cent like-for-likes are clearly extraordinary. Even if it comes off a bit through the second half we will be the stand-out retail performer in the UK market.”

Retailers have suffered a difficult two years as consumers worry over job security, rising inflation and the squeeze on incomes.

Primark flagged up higher cotton prices which could limit its stellar growth and said trading was weaker during the prolonged period of cold weather in 2013.

In contrast, the cold weather boosted sales at Carpetright as people put off outdoor improvements and focused on their homes.

The retailer, which has suffered a big decline in profitability in recent years, reported a strong rise in sales despite competitive trading conditions.

Carpetright’s efforts to refurbish its shops and expand its laminate floor and bed ranges have helped the company to attract shoppers over the past year.

Chief executive Darren Shapland said: “Whilst the recent cold spring weather has been positive to our sales, we believe this performance reflects the continued success of our programme of self-help initiatives.”

Like-for-like sales in Carpetright’s Europe division – made up of Ireland, Belgium and the Netherlands – fell 10.2 per cent, dragged down by weak trading in the Netherlands.

The company said it is on track to meet expectations for the financial year to the end of this month. Cantor Fitzgerald is forecasting profits of £10m for the full year.

It made profits of just £4m in its last financial year, compared with £62m in 2008 before the banking crisis.

Mr Shapland took over from Lord Harris of Peckham last year.