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Marks & Spencer sales have fallen for the six months to 26 September but the company plans to concentrate on increasing food sales.

Over that period, UK like-for-like sales fell by 0.4% and the sales of general merchandise were down by 1.2%. This includes the clothing section of the company.

However, Marks & Spencer said that underlying profits rose by 6.1%, showing a total of £284 million. Once the one-off items were taken into account, pre-tax profits fell 22.7% to £216 million.

The retailer said that trading conditions were difficult because of the high levels of promotions in the first quarter due to unseasonal conditions.

M&S could be at a turning point if they concentrate on increasing food sales, gross margins and cash generation as planned. The chief executive Marc Bolland said he has focused on making sure that margins are improved and sold fewer items on promotion.

International sales were also affected because sales fell 0.9%, which excludes currency movements.

There is a lot more competition on the high street, especially with Christmas just around the corner but the good news is hat M&S profit margins at its non-food business had risen by 2.85 percentage points.

 

Whitbread’s half-year pre-tax profits were boosted to £254.9 million by Costa coffee and Premier Inn sales, which is up 5.4% during the same period a year ago.

Costa coffee sales made an underlying operating profit of £67 million and sales at Premier Inn rose by 12.6% but the total sales rose 11% to £1.44 billion. 84% of bookings at Premier Inn are now done online and it will continue to grow with investment.

Costa coffee is also on the rise as it opened 68 new stores in the UK during this half-year period and the target is to have around 2,500 shops in Britain by 2020.

With the new National Living Wage coming into effect in April 2016, Whitbread expects it to cost about £15 million to £20 million each year.

Whitbread has continued to grow in the past few years because of the demand for affordable hotels and takeaway coffee but growth was not as good in its restaurant brands, such as Brewers Fayre and Beefeater, because like-for-like sales were only 0.1% higher.

Andy Harrison has been in charge for five years and these results are the final set before Alison Brittain takes over in December.

The late timing of the bank holiday hit retail sales in August and the total UK sales did not change, said the British Retail Consortium (BRC).

Like-for-like sales, which exclude new store space, fell 1%. Although the bank holiday fell on the 31st August, both the BRC and the Office for National Statistics (ONS) said that the month actually ended on 29th August. 

Retailers use a system where they report on sales week-by-week from Sunday to Saturday. This means that monthly figures may not cover the whole of the calendar month. As an alternative, a quarter will be made up of two four-week periods and a five-week period.

The problem is that when a bank holiday falls in different months in certain years, it creates difficulty in comparing sales.

However, the figures that come out for September could be higher as more customers are buying for back-to-school. However, clothing and footwear sales were hit as they missed the key days when customers shop for school.

 

 

Tesco’s UK stores has reported a slower rate of decline in sales thanks to its plan to stem the number of customers choosing discounter stores such as Lidl and Aldi. The business has made progress as UK sales only fell 1.3% for the three months to the end of May, which is lower than the 4% drop a year ago.

Analysts were also proven wrong as they forecast Tesco to make a fall of 1.6%-3%. The UK result is an improvement on the 1.7% fall that was reported in the fourth quarter of the financial year.

In April, the supermarket giant reported a huge loss, making that result the worst in its history. Mr Lewis took over the helm in September and is still trying to revive the company but it will take time. It has not been a good year for Tesco and the loss it made was one of the largest in UK corporate history as it reported a full-year pre-tax loss of £6.4 billion. It also said that 43 of its stores would close because around £4.7 billion of the losses were the result of the fall in property value of its UK stores.

However, these issues are slowly being resolved and Tesco could be on the rise again.   Including its international businesses, group sales did drop 1.3% in the quarter, which is better than a 3.4% dip a year ago.