Primark set to launch its first stores in the US

 
Kasmira Jefford
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ASSOCIATED British Foods (ABF) is taking Primark to the US, the FTSE 100 conglomerate announced yesterday, as it reported a 26 per cent leap in the budget clothing chain’s profits.

Primark is set to open a 70,000 square foot store in Boston in 2015 and it is also in talks to open a further eight shops in the north east of the US as well as a warehousing site.

The US has been a notoriously difficult market for British retailers to break into, with Tesco, Marks & Spencer and Sainsbury’s among some of the names to have retreated from the country.

However finance director Johnson Bason said the group was confident it would replicate the success the Primark brand has had in Europe and win over American shoppers. “Primark offers best value for money, fashionability and a great store environment and that’s the concept we intend to take to the US,” he said.

“The north east of the US is a densely populated area and has close cultural ties with continental Europe. I think all of that will play very well with Primark,” Bason added.

Shares jumped eight per cent yesterday as ABF reported better-than-expected operating profits at Primark of £298m, on sales up 14 per cent. The fast-growing retailer has opened 1m sq ft of space in the past year and now has 271 stores in nine countries, including France, Spain, Portugal, Germany and the Netherlands.

Overall, group profits in the 24 weeks to 1 March rose one per cent to £497m, meeting analyst expectations, but were dragged down by its sugar business, which saw profits fall 60 per cent.

AMERICAN DREAMS AND NIGHTMARES

WINNERS

BURBERRY
Opened a New York store in 1970
Now has more than 30 stores which made £380m of sales in the first six months of the year

TED BAKER
Launched in New York in 1998
Now has 63 stores and concessions, plus a website

TOPSHOP
Debuted in New York in 2009
Now has 60 outlets and sold a stake to Leonard Green & Partners

LOSERS

TESCO
Fresh & Easy shuttered after five years, costing £1bn

MARKS & SPENCER
Bought Brooks Brothers and King’s in 1988, but sold them for a fraction of the price in 2001 and 2006

DIXONS
£200m in write-offs from struggling US unit Silo, bought in 1987

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