The owner of Primark has lifted its outlook for the full year as it reported a jump in sales driven by higher prices.
Associated British Foods, which also has major sugar, ingredients and other food businesses, said its sales surged by 16% over the three months to the end of May to £4.7 billion.
Sales in Primark grew by 13% across its global stores, and by 6% in the UK, compared to the same period last year. The uplift was helped by higher average selling prices for its products, the company said.
The retail giant now expects its adjusted operating profit for the full year to be slightly ahead of last year.
“The dominant driver of the current sales number is pricing, related to inflation through the system”, Eoin Tonge, AB Foods’ finance director, told the PA news agency.
He said volume growth – meaning the number of items that people put in their baskets – moderated in the latest quarter with adverse weather conditions causing volatility in the UK.
Mr Tonge added: “There is definitely signs of [inflation] easing up from a cost point of view, but it is still a very high inflationary environment and there is still quite a bit of volatility – for example, wheat prices have been moving around quite a lot over the last few weeks.
“And obviously labour inflation is very high and we see that maintaining.”
He said the environment is still “tough” but that consumers have proved to be resilient, and are continuing to hunt for value.
Primark, which has 191 stores in the UK and in 16 regions across the world, saw clothing and accessories, as well as health and beauty products, sell well during the period.
It also said shoppers have been flocking to its flagship city centre stores, with its summer range including linen clothing and boho styles flying off the shelves.
Nevertheless, AB Foods previously said that its group margin declined during the first half of its financial year as it did not pass through the entirety of cost inflation to consumers via price rises.
