Business
Covid-19 Update - Re-opening of Primark Stores
Covid-19 Update - Re-opening of Primark Stores.
About this update from Associated British Foods Plc
[{"type":"text","content":"\n \n \n RNS Number : 5009O\n Associated British Foods PLC\n 01 June 2020\n \n \n \n \n 1 June 2020\n \n \n \n \n \n Associated British Foods plc\n \n \n Covid-19 Update - Re-opening of Primark Stores and Improved Group Cash Flow\n \n \n \n \n \n Associated British Foods plc, the diversified international food, ingredients and retail group, is issuing the following statement which includes the likely timetable for the re-opening of Primark stores, early trading indicators from the recently re-opened stores which have been both reassuring and encouraging, and a group forecast with an improved cash flow. \n \n \n \n \n \n The group trading update scheduled for 2 July will include Primark sales which will be informed by trading in stores soon to re-open and an additional four weeks of data. \n \n \n \n \n \n Primark stores\n \n \n As a result of the rapid spread of Covid-19 in our markets, all Primark stores were closed over a 12-day period from 11 March. As previously advised, this resulted in a loss of sales of approximately £650m for every month that all stores were closed.\n \n \n \n \n \n We took a number of actions in Primark to substantially reduce the cash outflow resulting from this loss of sales. These mainly comprised cancellation of future orders for goods where the handover date from the supplier was after 17 April and a range of measures to reduce operating overhead while the stores are closed. The most significant contributor to the reduction in overheads has been access to government employment retention schemes across Europe, assisted by a temporary voluntary reduction in salaries for all Primark employees not covered by a government scheme. We continue to make progress in our discussions with landlords to renegotiate some of the terms in our lease arrangements. In April and May, we exceeded our previously advised estimate of a 50 percent reduction in Primark overheads. \n \n \n \n \n \n As European governments have begun to ease restrictions on clothing retailing we have been able to re-open stores. Safety has been our highest priority in our detailed preparations to welcome our customers and employees back to stores. We are following government safety advice in all markets. Importantly, we will apply the valuable experience gained from more than 100 stores which are...