Primark has issued a new turnover warning as two-thirds of all stores are closed due to stricter Covid-19 measures in the UK. The retailer fears the restrictions will knock more than 200 million pounds off sales.
No online safety net
AB Foods, the owner of the cut-price fashion chain Primark, now estimates the loss in turnover due to the measures linked to Covid-19 at 650 million pounds (723 million euros). At the beginning of December, the Irish retailer talked about a loss of 430 million pounds (478 million euros), but, since then, a new highly contagious variant of the virus has emerged in the UK.
The UK Government has therefore decided to extend the area constricted by the most severe measures. All non-essential stores throughout the northeast of England, the Manchester area, large parts of the Midlands and the Southwest must remain closed. More than two-thirds of all Primark shops worldwide are now closed, reports The Guardian. This is another heavy blow for the company, which cannot fall back on an online store, unlike most of its competitors.
According to consulting firm BDO, the number of shoppers on the British high street fell by 46 per cent last week compared to the same period a year earlier. Online sales have increased by half, but they cannot fully compensate for the losses. Fashion sales dropped more than a third compared to a year ago.