(Alliance News) - Associated British Foods PLC said Monday it expects to reopen all of its Primark stores in England on June 15, following the recent announcement by the UK government on the opening of all other non-essential retail stores by that date.
As at Monday, fashion retailer Primark is trading in 112 stores, which represents 34% of the brand total selling space. By June 15, Primark anticipates having 281 stores opened around the world, which represents 79% of total selling space.
Trading in the 112 stores has been regarded as both "reassuring and encouraging", with consumer demand strong for children's leisure and night wear, alongside summer products.
AB Foods said it is awaiting further guidance for the stores in the rest of the UK, and expects openings in late June.
Primark stores have been closed since March 11, leading to a loss of sales of GBP650 million for AB Foods for every month that all stores were closed. Since then the group has taken action to reduce the cash outflow, which comprising of cancelling future orders for goods where the handover date from the supplier was after April 17.
In addition, AB Foods has continued to make progress in its discussions with landlords to renegotiate some of the terms in its lease arrangements.
From June to August, the group will continue to reopen the rest of its Primark stores, leading to the full portfolio of 278 stores being open.
Meanwhile, in the Food business, AB Foods has maintained production all of its business facilities despite the operational challenges arising from the Covid-19 pandemic.
Grocery operating profit is expected to be ahead of its prior expectations, with stronger sales of branded products sold through the retail channel, more than offsetting weaker sales in food service.
However, the group expects a profit drop at AB Sugar following a further disappointing performance at Illovo.
Looking ahead, AB Foods said it is too early to resume earnings guidance for the remainder of its financial year.
Shares in Associated British Foods were up 6.5% at 1,939.50 pence on Monday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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