Primark owner Associated British Foods said it will not pay an interim dividend to save cash during the coronavirus crisis.

The company also announced a £284m charge to reflect an expected lower value of stock when its stores reopen. 

The company also did not give profit guidance for its full 2019-20 year to the end of August.

But it reiterated they will be "much lower" than envisaged at the start of the financial year, because the group does not know when its stores will emerge from lockdowns across Europe and the US. 

All of Primark's 376 stores in 12 countries have been closed since March 22, representing a loss of £650m of net sales per month. Primark trades as Penneys here. 

"One of the world's great clothing retailers is entirely shut," chief executive George Weston said today. 

Primark, which does not have an online business, generates about half of AB Foods' revenue and profit. 

The group said it would be able to mitigate half of the operating costs of the Primark business while the stores remain closed, with 68,000 employees receiving furlough payments from governments across Europe. 

But it said the timing of the reopening of the stores remains uncertain, while the process of reopening, once it begins, was likely to be complex, with costly social distancing measures needing to be implemented. 

"It's the right thing to do and we have no choice anyway because no one's going to want to come into a store which ignores social distancing," Weston told Reuters. 

He said the only country where Primark had visibility on stores re-opening was Austria, with its five stores there expected to re-open in the first week of May. 

AB Foods said its second half expectations for its other businesses - sugar, grocery, ingredients and agriculture - were unchanged.

Shares in the group, the majority of which are owned by Weston's family, were down 4% in London trade today, extending losses for 2020 to 27%. 

"It's clear to us that a full Primark run rate (pre-crisis sales levels) is unlikely to be re-established until its 2022 fiscal year. Many of its high street peers either may not be around by then or rapidly shutting stores," analysts at Barclays said. 

For the group's first half to February 29, adjusted operating profit rose 7% to £682m, on revenue up 2% to £7.6 billion. But statutory operating profit fell 38% to £349m after exceptional charges of £309m, including the provision for Primark stock. 

Weston said it would be "entirely inappropriate" to pay an interim dividend. Not paying one will save the group about £100m. 

He said the company would consider paying a dividend at the year end in the light of trading for the full financial year and the financial circumstances at that time. 

"Although uncertainty remains, we have the people and the cash resources to meet the challenges ahead," the CEO said.

The group has available cash of £1.5 billion.

Primark said yesterday it had agreed to pay an additional £370m to suppliers to cover stock currently in production or yet to be delivered after facing criticism over order cancellations during the coronavirus crisis. 

The fashion chain said the deal will cover products which were in production or due for shipment by April 17, having previously committed to pay for orders which were in transit or booked for delivery by March 18. 

Bosses also set up a fund to support the thousands of garment workers affected.