Primark Spain Hits Record Turnover Amidst Slowing Growth and Ambitious Expansion

Primark, the prominent Irish fast-fashion retailer, significantly bolstered its presence in Spain during the 2024 financial year, achieving a record turnover of €1.885 billion. This figure, derived from the annual accounts filed by Primark Tiendas SL with the Mercantile Register, represents a 3.7% increase over the previous financial year. While marking an all-time high for the company in Spain, this growth rate also indicated a deceleration compared to prior years, signaling the slowest expansion since the pandemic, as noted by the business daily Cinco Días.

In terms of profitability, Primark's Spanish subsidiary concluded the year with a net profit of €40.3 million, reflecting a 4% rise from the preceding year. This increase in net earnings occurred despite a 9% decrease in operating profit. The primary factor contributing to this decline in operating profit was an increase in payments associated with the franchise agreement held with its parent company in Ireland.

The majority of the revenue generated came from in-store sales, which saw a 7.2% increase, reaching €1.576 billion. This growth, however, was slower than the 14.4% increase recorded in 2023. Concurrently, sales to other group companies, predominantly to Ireland, experienced a nearly 13% decline. When specifically considering in-store sales, the gross margin impressively stood at 31.1%, marking a significant ten-percentage-point improvement over the previous year.

Beyond the observed slowdown in sales growth, the financial year was characterized by an aggressive expansion strategy across Spain. Primark successfully opened six new stores during this period, with four new establishments in the Community of Madrid, and additional openings in Melilla and Lorca. This commitment to growth has continued into the current financial year, with notable new store openings including locations in Zaragoza's Grancasa shopping center and Lugo's As Termas, further solidifying Primark's extensive footprint in the country. Currently, Primark operates a total of 66 stores in Spain, employing a workforce of over 7,000 individuals.

Founded in Dublin in 1969 under its original name, Penneys, Primark is a key component of the British food and retail conglomerate, Associated British Foods. On a global scale, the company boasts more than 460 stores spread across 17 countries, encompassing various regions in Europe and the United States. Looking to the future, Primark has outlined ambitious plans to further expand its retail network, aiming to reach a total of 530 stores worldwide by the year 2026.