Christmas sales: the winners and losers on the UK high street | Business

The 2018 festive shopping season got underway with low expectations for the retail sector. Investors were braced for bad news after a string of warnings in the run-up to Christmas, including a declaration from Sports Direct boss Mike Ashley that November was the “worst on record” for retailers. Against a backdrop of rising rents, business rates, a shift to online shopping and diminishing consumer confidence, retailers had to battle to win customers over the crucial trading period. Here are the winners and losers so far.

Winners

Next

One of the best-known names on the high street enjoyed a better-than-expected Christmas after a late surge in online sales. The retailer, considered a bellwether for the whole sector, reported overall sales growth of 1.5% for the last two months of 2018. As one of only a few retailers to resist pre-Christmas discounting, Next was expected to struggle as its rivals slashed prices to entice shoppers suffering Brexit jitters. As it turned out, it was saved by online sales, which rose 15.2% over the period. Sales in its shops, however, were down 9.2%.

John Lewis

John Lewis enjoyed a strong finish to a rollercoaster Christmas trading period as consumers made a late dash to the shops. Sales at the department store chain rose 4.5% in the week to 29 December compared with the same period last year. It was followed by an 11.2% increase in the following week. Fashion, women’s accessories, cosmetics and technology all proved popular and helped to drive sales growth. However, the healthy sales figures give no indication of the chain’s profitability over the festive season, during which it was forced to match rivals’ price cuts to honour its “never knowingly undersold” policy.

Shoppers walk past John Lewis on Oxford Street



Sales at John Lewis rose 4.5% in the week to 29 December compared with the same period last year. Photograph: Martin Godwin for the Guardian

Morrisons

The UK’s fourth-biggest supermarket chain just about beat expectations after delivering growth in like-for-like sales for a fourth consecutive Christmas. Sales across its core supermarket business rose 0.6% in the nine weeks to 9 January, slightly above analysts’ expectations of a 0.5% increase. Morrisons said customers were “increasingly savvy” and that it had benefited from being competitive on price, with a basket of Christmas goods unchanged from last year.

Aldi

The German grocery chain was a festive winner, enjoying its busiest ever week and a 10% rise in sales in the week before Christmas compared with the same period last year. Traditionally known as a discount retailer, Aldi said sales were boosted over the week by demand for its premium ranges, such as beef chateaubriand, 32-year-old French brandy and panettone. The sales rise was also driven by an increase in space at the chain, which opened 65 stores last year.

Dunelm

Demand for unicorn-themed goods and a slicker online operation helped Dunelm to better-than-expected sales growth over Christmas. Sales in its core Dunelm brand increased by nearly 10% to £304m in the 13 weeks to 29 December, prompting the home furnishings group to upgrade its full-year profit expectations. Unicorn bedding and rocking horses were among the bestsellers, as were sheepskin rugs.

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Joules

A strong online performance drove bumper sales at Joules in the seven weeks to 6 January. The clothing retailer, known for its bright floral prints and pink wellies, said sales increased by 11.7% over the period, with growth across all of its product ranges. Bestsellers included accessories such as purses, handbags and watches, as well as knitwear and footwear. Orders placed online – both on its own website and through concession partners’ websites – accounted for almost half of its sales.

Losers

HMV

A clear loser was HMV, which announced on 28 December it was calling in administrators for the second time in six years, putting more than 2,200 jobs at risk. The music and film retailer said firms across the sector were facing “a tsunami of challenges” and that festive trading at HMV had been “extremely weak”. The 97-year-old company has also lost out during a period of rapid change for the entertainment industry, with consumers increasingly ditching CDs and DVDs in favour of streaming sites such as Spotify and Netflix.

Footasylum

The struggling footwear and hoodie chain said tough trading conditions continued through Christmas, prompting it to slash prices more than expected. Revenues rose 14% over the 18 weeks to 29 December, but Footasylum warned its decision to cut prices had hit margins, and full-year earnings are now likely to be at the lower end of analysts’ forecasts. Its shares, the worst performers in the retail sector last year when they plunged by 90%, slithered to a new all-time low after the warning.

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