Associated British Foods plc (LON:ABF) shares fell on Monday after it announced that all Primark stores will shut amid the evolving COVID-19 outbreak.
Shares in the company were down by almost 8% during trading on Monday.
Associated British Foods said that all 376 Primark stores in 12 countries are now “closed until further notice”.
It continued to warn that this represents a loss of roughly £650 million of net sales each month.
The British government has recently accelerated measures to contain the spread of the illness.
People are being encouraged to stay indoors and practice social distancing.
Elsewhere on the high street, Laura Ashley (LON:ALY) recently collapsed after the COVID-19 outbreak had an “immediate and significant impact” on trading.
Meanwhile, Boris Johnson told cafes, pubs, bars and restaurants that they must close their doors.
Associated British Foods said on Monday: “A variety of work streams have been established to mitigate the effect of the contribution lost from these sales and all expenditure is being reviewed. In the first instance we have implemented a significant reduction in discretionary spend. We are making good progress in also reducing fixed costs following discussions with counterparties, in particular landlords, and welcome the recently announced government support in the countries in which our stores operate. ”
“As a result, we currently estimate being able to recover some 50 percent of total operating costs,” the company continued.
In order to manage Primark stock, Associated British Foods has informed suppliers that it will stop placing new orders.
With the health and welfare of our employees and customers at the front of our minds we have made the decision to close our stores in the UK, until further notice. A huge thanks to all our employees, customers, suppliers and partners for their continued support 💙 pic.twitter.com/AynpV8KiQi
— Primark (@Primark) March 22, 2020
Shares in Associated British Foods plc (LON:ABF) were down on Monday, trading at -7.96% as of 12:03 GMT.