Thomson Reuters
Associated British Foods' Penneys fashion business has good stock availability for the Christmas trading period and will not be raising prices despite supply chain disruption and inflationary pressures, its finance chief said on Tuesday.
"We're basically saying that we've got good stock cover for Christmas, our stores will be full," John Bason said after the group reported full year results.
He said there would be limited stock cover on a small number of Penneys lines which customers "may struggle to even see".
Bason also pledged that Penney's prices for autumn/winter stock would be flat versus the 2020-21 year.
It was able to take this stance because Penneys was benefiting from transaction currency gains arising from the weaker US dollar, improved store labour efficiency and lower operating costs.
The group said it expected Penneys, known as Primark outside Ireland, sales for 2021-22 to increase by at least the estimated £2 billion (€2.35 billion) lost to closures, with its adjusted operating margin recovering to over 10 per cent. Revenue and profit fell 5 per cent and 11 per cent in 2020-21.
Sentiment was also boosted by Primark predicting its store estate will grow from 398 currently to 530 in 2026, by the group forecasting "significant progress" in 2021-22 earnings and the payment of a special dividend as part of a new capital allocation policy.
