Better weather and sales of summer garments have helped one of the UK’s leading fashion retailer’s move to lift its profit outlook.

Primark’s move to reset its forecast came just over six months after the fashion giant hinted at job losses.

Around the same time it said it would freeze fashion prices in the face of inflation.

AB Foods earlier estimated that inflation increased costs across the group by some £1 billion this year alone.

Associated British Foods, its owner, said its food sales growth was “largely driven by the necessary pricing actions taken earlier in the year to offset input cost increases”.

Better weather has helped. 

“Primark has continued to trade in line with our expectations, with summer ranges performing well as the season started in our markets,” the company said in an update to the City.

ANALYSIS: Primark owner sales growth driven by higher price

It comes after fashion brand Next reported rising revenues and Zara owner Inditex was also boosted by strong early summer sales.

Higher prices have also supported the owner of Primark’s growth as summer sales are also helping the retailer weather the cost of living storm.

Associated British Foods, which owns Primark, lifted its outlook for the full year.

It comes as better weather helped other fashion high street retailers. The company, which has 191 Primark stores across the UK, which is its biggest market, is also opening new outlets across the world, including in the US. It has more than 400 stores worldwide.

AB Foods, which also has major sugar, ingredients and other food businesses, said its sales surged by 16% over the three months to the end of May to £4.7bn.

OPINION: Primark: the saviour of the high street?

The parent firm, which owns the high street chain alongside a raft of grocery brands such as Kingsmill and Ryvita, also said “the deployment of Primark’s much-improved website” continued, launching in Germany, Spain, Italy, and the US in the period and in France shortly after the period ended”.

The remaining markets will follow over the summer.

Sales in Primark grew by 13% across its global stores, and by 6% in the UK, compared to the same period last year. The uplift was helped by higher average selling prices for its products, the company said.

The retail giant now expects its adjusted operating profit for the full year to be slightly ahead of last year.

It also said shoppers have been returning to its flagship city centre stores, with its areas including festival fashion, beachwear and suitcases selling well.

READ MORE: Primark price freeze pledge despite inflation hit

 

It had said earlier said that its group margin declined during the first half of its financial year because it had not passed all of its costs to customers.

"The dominant driver of the current sales number is pricing, related to inflation through the system", Eoin Tonge, AB Foods' finance director said.

He said volume growth - meaning the number of items that people put in their baskets - moderated in the latest quarter with adverse weather conditions causing volatility in the UK.

Sales in southern Europe and the Iberia region have done particularly well amid warmer weather, he said.

Mr Tonge added: "There is definitely signs of [inflation] easing up from a cost point of view, but it is still a very high inflationary environment and there is still quite a bit of volatility - for example, wheat prices have been moving around quite a lot over the last few weeks.

"Obviously labour inflation is very high and we see that maintaining."

READ MORE: Primark suggests possibility of job losses as profits set to tumble

He said the environment is still "tough" but that consumers have proved to be resilient, and are continuing to hunt for value.

AB Foods said in the update: “Trading across our food businesses has continued to be good, following the trends seen in our second quarter. In particular, we have seen strong constant currency sales growth in grocery and ingredients largely driven by the necessary pricing actions taken earlier in the year to offset input cost increases.”

It also said: “Primark has continued to trade in line with our expectations, with summer ranges performing well as the season started in our markets.

“Based on current trading conditions, we now expect the group’s adjusted operating profit for the full year to be moderately ahead of last year.”

Shares in AB Foods closed at 1,937p, down 16p, 0.82%.