High street clothing retailer Next is helping lift the FTSE 100, with shares rising 8% despite fresh lockdown measures.
That’s because investors are focusing on its strong Christmas trading figures instead. My colleague Zoe Wood explains:
Next has emerged as a winner from a tough Christmas period as sales transferred from shuttered stores to its website but the fashion chain warned new lockdown measures would wipe out the extra profit it had made.
The retailer’s chief executive Simon Wolfson said profit from better than expected sales in November and December would be almost entirely offset by this month’s new lockdown restrictions which would force its stores to close, as well as costs stemming from the disruption to its important traditional Boxing Day sale.
The retailer said the pandemic was also delaying the arrival of container traffic from the far east. Wolfson said many of its deliveries were running two to three weeks late with its stock levels 10% lower than two years ago. Wolfson expected stock levels to “return to more normal levels by the end of March”.
Sales in the nine weeks to 26 December were just 1.1% lower than in 2019 – a far better outcome than the drop of 8% pencilled in by the company. While UK store sales tumbled 43% its online sales were up 36%.
But supermarkets are upbeat as they report their Christmas trading figures.
Strong demand for luxury Christmas favourites helped to drive an 8.5% rise in sales at Morrisons over the festive period, as the chain kicked off reporting on what is expected to be a bumper trading period for supermarkets, Sarah Butler reports.
Morrisons said online sales had tripled and growth was boosted by strong demand for festive favourites such as champagne and salmon as families made the most of the quieter festivities.
Sales in Morrisons established stores rose 7.3% in the nine weeks to 3 January but that was boosted by a 1.2% rise in wholesale sales via the retailer’s deal with Amazon and to supply convenience stores.
David Potts, the chief executive, said:
The pandemic has had a severe effect on people and communities around Britain for nine months now but it has been especially hard at Christmas time.
I’m very pleased with the way the Morrisons team has helped our customers across the nation enjoy their Christmas in the best way they could.
Morrisons shares are up 0.9% this morning.
European equities open lower amid tougher Covid lockdowns
Gove: Chancellor to announce further business support today
CBI boss: Government must offer more business support before March budget
Introduction: England, Scotland plunged into fresh lockdowns