LONDON - Primark-owner AB Foods warned that the loss of sales from store closures could rise to over 1 billion pounds ($1.36 billion), with lockdowns in its main UK market and elsewhere in Europe shutting about 76% of its retail selling space.
AB Foods said in a statement that if all those stores stayed shut until its financial half-year on Feb. 27, then the loss of sales would reach some 1.05 billion pounds, a 55% jump from Dec. 31 when it warned of a 650 million pound loss.
Unlike many rival retailers who can continue to trade online during lockdowns, Primark does not have an online shop.
AB Foods said that it now expected the store chain's adjusted operating profit to be "somewhat lower than last year", downgrading a previous forecast made in December for it to be higher.
Primark made a profit of 362 million pounds in its 2019/20 financial year which ended on Sept. 12.
AB Foods, which has suspended group earnings guidance due to the pandemic, also has a grocery division, whose brands include Kingsmill bread, Twinings tea, the Ovaltine drink and Jordans cereal, as well as major sugar, agriculture and ingredients businesses.
It said on Thursday that aside from Primark, its businesses were performing strongly and it expected adjusted operating profit for the current 2020/21 financial year to be "well ahead of last year".
Brexit had not caused any material disruption to its supply chains, AB Foods added.
($1 = 0.7336 pounds)
(Reporting by Sarah Young, Editing by Paul Sandle and Estelle Shirbon)