Primark will become more expensive and plans to lay off workers. The reason is the increase in “everything” costs

The clothing retailer Primark has significantly increased sales since the pandemic, but due to inflationary pressures, it will be forced to increase prices for some products from the autumn and winter collection. This was announced by the British company Associted British Foods, which is the parent company of Primark. In addition, he also owns food and agricultural enterprises.

AB Foods’ adjusted operating profit nearly doubled in the fiscal half-year to £ 706 million (CZK 20.5 billion). Sales rose 25 percent to £ 7.88 billion. Sales and profits thus returned to pre-pandemic levels. The half-year ended on March 5.

The results of all Primark stores remain open, except for a short outage in Austria and the Netherlands. In the comparable period of the previous year, on the other hand, stores in Britain and Europe were closed for a long time. Primark’s revenue alone rose 59 percent to £ 3.5 billion.

The company said inflationary pressures are now so high that it is unable to offset them with savings. Primark, which opened a store in the center of Prague last June, must raise prices.

The primary, which is known mainly for low prices, has been more damaged by coronavirus restrictions in Europe than by competitors because it lacks an online store. The company has already announced this year that it plans to cut 400 jobs to reduce costs. Sales are recovering strongly in Britain and Ireland, but consumer attendance on the continent remains weaker and returns to normal performance will take longer.

Many traders have already warned that they will have to raise prices because their costs are rising – from energy to packaging and labor. AB Foods added that it expects a higher decline in margins for its food products than previously anticipated for the entire fiscal year, due to higher prices of raw materials, commodities, energy and the supply chain in general.

The Irish chain with cheap fashion has stated in the past that it wants to open a second store in the Czech Republic, in the Olympia shopping center in Brno. The agreement was signed in 2020, with the proviso that the business should start operating this year.