‘Challenging’ November for Primark spooks British retail industry

Shares in the company that owns the Dublin-based fashion retailer Penneys, which trades abroad as Primark, fell 4.6 per cent on Friday after it surprised investors by announcing the retailer had a "challenging" November.

The announcement by Associated British Foods added to the gloom surrounding the British retail sector, which has experienced a tough 2018 pockmarked by high-profile insolvencies and profit warnings.

Primark, which operates from a headquarters in Dublin’s north inner city, is viewed as one of the most resilient retailers operating in the UK. Associated British Foods blamed a fall in shopper numbers and unseasonably warm weather for negative underlying sales in November.

The Primark update added to evidence of a slowdown in British consumer spending in the run-up to Brexit. Data published on Tuesday showed British consumer spending grew last month at its slowest pace in more than a year.

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Negative November

Associated British Foods finance director John Bason told Reuters Primark's like-for-like sales were "just positive" in September and October but were negative in November. He declined to give precise numbers.

“This isn’t a call on Christmas – we’ve got three big weekends coming up now before Christmas. But I think it is a call on quite mild weather during November and I think it’s affected footfall,” said Mr Bason.

Primark, which accounts for about half of Associated British Foods revenue and profit, currently trades from 363 outlets in Europe and North America.

The chain is due to open a new shop in Belfast on Saturday after its old outlet was destroyed in a fire. – (Additional reporting: Reuters)