Retail snapshot: record Christmas sales plump up Sainsbury's turkey share

Gladys Abbott
January 12, 2018

Supermarket giant Tesco said United Kingdom like-for-like seasonal sales rose by 1.9 per cent, driven by a strong grocery performance.

The retailer also said that it head improved customer service by opening more tills and improving stock availability.

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

That trend was confirmed today by John Lewis (JLH) Partnership chairman Sir Charlie Mayfield, who said pressure on margins at John Lewis and Waitrose had intensified in recent months "because of our choice to maintain competitive prices". The company's clothing & home sales in the United Kingdom were down 2.3 percent to 1,192 million pounds (1,607.8 million dollars), while the segment's like-for-like sales dropped 2.8 percent.

Tesco, which has been transformed by CEO Lewis following a 2014 accounting scandal, reported a 1.9% rise in like-for-like sales in its United Kingdom home market in the six weeks to January 6, below a forecast of 2.4-3.2%.

Chief executive Dave Lewis said the retailer "continued to outperform the market" in the 19 weeks to 6 January 2018.

Though Tesco said it enjoyed "record sales and volumes" in the four weeks up to Christmas Day, its shares fell by 4.8 per cent while shares in M&S fell 5.6 per cent.

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Tesco, the UK's biggest supermarket chain, reported like-for-like growth of 1.9% for its United Kingdom stores, a performance it said as thanks to the strength of its food business which saw underlying growth of 3.4%.

The festive sales fall comes after it gave hope last November that its turnaround was gaining traction in the embattled clothing and home division, when second-quarter sales dipped by just 0.1%.

The timing of these companies' announcements couldn't come at a more telling time" suggested Accendo Markets analyst, Henry Croft, "coming against the backdrop of a stellar period for German discounters, as per Kantar data earlier in the week, and outstanding performances from fashion retailers...as companies both young (Boohoo) and old (Ted Baker) see bumper demand...

"We are confident in the outlook for the full year and are firmly on track to deliver our medium-term ambitions".

M&S said a pick-up in trading over the key Christmas weeks helped offset a hard start to the quarter, with consumer spending under pressure amid a squeeze on budgets from inflation.

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