M&S sales fall as shoppers on 'tighter budgets' look elsewhere

Tammy Harvey
January 12, 2018

Sainsbury's saw like-for-like sales rise 1.1% in the 15 weeks to 6 January and, unlike Morrisons, it seems like it was able to do that without having to rely on higher food prices alone, with punters treating themselves to more of its Taste the Difference products.

Meanwhile, UK like-for-like sales during the Christmas period rose by 1.9% and total sales was up by 2.1 per cent, driven by a strong grocery performance. Gains in the FTSE 100, however, remain capped, with retailers weighing on the index following disappointing results by Tesco (LON:TSCO) and Marks & Spencer (LON:MKS).

United Kingdom supermarket retailer Tesco posted its eighth consecutive quarter of positive sales growth, with its clothing sector performing well throughout the Christmas period as its F&F ranges continue to prove popular with customers.

According to its latest trading update, third quarter like-for-like sales in the United Kingdom grew by 2.3 per cent - representing Tesco's eighth consecutive quarter of growth - and total sales grew 2.5 per cent.

Tesco Ireland recorded its highest market share growth in five years during the third quarter as like-for-like sales rose 3 per cent.

Like-for-like (LFL) sales in the United Kingdom grew 2.3% in Q3 (13 weeks to 25 November).

The results represented the company's eighth consecutive quarter of growth and continued market outperformance, it claimed.

The price war that has ravaged the industry (thank Aldi and Lidl for that) doesn't just effect the likes of Tesco and Morrisons and Waitrose - often seen as a more "premium" supermarket - Waitrose also complained of margin pressures.

British retailer Marks & Spencer reported better than expected sales of both clothing and food in the key Christmas quarter and said it was maintaining financial guidance for its full 2017-18 year.

Marks & Spencer recorded a 1.1% uplift in United Kingdom revenue, but global sales were down 9.8%, reflected the completion of the planned closure of owned stores in loss-making markets.

The performance of the fresh food category had been helped by a strong seasonal offer, said Tesco, including its "Festive 5" vegetable deal.

M&S said a pick up in trading over the key Christmas weeks helped make up for a weak clothing market and more hard trading in its food business, with consumer spending under pressure amid a squeeze on budgets from inflation.

Other reports by Ligue1talk

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