The impact of the coronavirus has seen Primark go from making £650m in sales a month to nothing, says the owner of the clothing chain.
As lockdown measures forced it to close stores, Associated British Foods (ABF) said Primark “has been squarely in the path of this pandemic”.
Announcing that the chain has written down the value of its clothing stock by £284m, boss George Weston said: “From making sales of £650m each month, since the last of our stores closed on 22 March, we have sold nothing.”
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He said that he would “love” to be able to reopen Primark stores but added: “I know that we must not do so until we have suppressed this disease.”
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ABF said it plans draw on government programmes to provide income for employees no longer working and is seeking discussions with landlords for help with lease payments.
The owner said that internal cost-cutting measures, combined with business rates relief, should allow it to recover some 50% of Primark’s total operating costs.
Commenting on the moves, Richard Hunter, head of markets at Interactive Investor, told City AM: “AB Foods has produced a measured response to the effects of the pandemic, battening down the cost hatches wherever possible and consolidating those parts of its business where some sort of earnings visibility is still possible.”
The Daily Mail says a survey from the British Chambers of Commerce shows around one in three British businesses has furloughed between 75% and 100% of its workforce.
