Primark to raise prices as cost pressures mount

Clothing chain Primark is set to raise prices due to severe inflationary pressures, its parent company Associated British Foods said on Tuesday, as it also warned on margins at its food businesses.

The group said cost pressures at Primark were such that it has been unable to offset them all with savings, and the business will therefore implement selective price increases across some of its autumn/winter stock.

The move underscores the balancing act the clothing industry is facing as it struggles to protect margins without denting demand amid the biggest squeeze on household budgets for decades.

“We are committed to ensuring our price leadership and everyday affordability, especially in this environment of greater economic uncertainty,” AB Foods Chief Executive George Weston said.

AB Foods, which also owns major sugar, grocery, ingredients and agricultural businesses, made adjusted operating profit of 706 million pounds ($900 million) for the 24 weeks to March 5, up from 369 million pounds in the previous corresponding period.

Group revenue rose 25% to 7.88 billion pounds.

via Reuters