AB Foods buoyed by Primark growth

Primark defied the bleak high street conditions to report an 8% rise in annual profits

Budget retail chain Primark defied the bleak high street conditions to report an 8% rise in annual profits.

The retailer, which is part of grocery business Associated British Foods, grew sales by 20% to £2.3 billion in the year to September 12, after opening 12 new stores and improving revenues on a like-for-like basis by 7%.

Primark achieved operating profits of £252 million in the 12 month period - a performance described by AB Foods as "exceptional".

The chain - known for its super-cheap clothes long before the arrival of the credit crunch - has seen strong expansion in the UK and Spain in recent years.

It opened a new distribution centre at Thrapston, Northamptonshire, in order to support growth, which recently saw it open a new store in Bristol to replace one of the first Primark stores to open in the UK in 1974.

AB Foods, which also owns the brands Twinings, Ryvita and Kingsmill, posted underlying profits of £655 million, an increase of 4% on a year earlier.

The figures from Primark come two months after founder Arthur Ryan announced his intention to relinquish day-to-day running of the firm.

He has been replaced by chief operating officer Paul Marchant, who has experience at several high street chains including Debenhams and New Look.

Mr Ryan, who set up the business in 1969 and is in his early 70s, is now chairman of the Primark operation.

The company also used Tuesday's results to defend itself against accusations that it exploits the overseas workers producing its clothes.