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UK Retail Briefing - May 2015

ANALYST COMMENT
 HOW THE ONLINE MARKET IS COMING OF AGE
Electricals
Figure 1: Profile of online electricals buyers, 2012-14
Fashion
Figure 2: Profile of leading clothing retailers, by age and socio-economic group, instore and online, 2014
Food
Figure 3: Proportion of shoppers doing all or most of their food shopping online, 2011-15
Online shoppers spend less
Implications
RETAIL SALES – BACKGROUND AND OUTLOOK
Key points
Retail sales trends
Figure 4: Retail sales trends, 2014/15
Figure 5: UK retail sales y/y growth, BRC vs ONS, 2013-15
John Lewis
Figure 6: John Lewis: Year-on-Year Growth, 2014-15
Inflation and wages
Figure 7: The income squeeze: Wages growth vs inflation, 2009-15
Inflation
Figure 8: Annual percentage change in the consumer price index for selected product groups, 2014-15
Looking forward
SECTOR FOCUS – FOOD RETAILING
The big four underperform:
Deflationary food prices – driven by competition
Figure 9: Consumer prices: Annual % change in the food and non-alcoholic beverages, April 2013- April 2015
Figure 10: Retail sales: Annual % change in value and volume sales in food stores, March 2013-March 2015
Superstores in decline
Figure 11: Estimated share of all grocery retail sales by sector, 2009-15
The impact of Aldi and Lidl
Figure 12: Leading grocery retailers, annual % change in sales (ex-vat), 2010-14
Figure 13: Market shares: The Big Four and The Discounters, 2009-14
So how have the grocers been fighting back?
HEADLINES FOR THE MONTH
Grocers
Clothing retailing
Multi-sector retailing
Department stores
DIY retailing
Electrical retailing
Furniture and homeware retailing
Sports and leisure goods retailing
Home shopping
Economy
NEWS ANALYSIS – FOOD & DRINK
 CO-OPS (RETAIL)
UK: Co-operative Food
…members press for election overhaul
…says it cannot enhance commitment to Fairtrade
 CONVENIENCE STORES
UK: One Stop opens two in-store Subway concessions
 GROCERS
UK: Morrisons
…former boss receives £1m bonus
…Q1 sales down 1.1%
…to cut head office staff by a third
UK: Sainsbury’s
…converting space to non-food
…gains Next’s former CFO
…reports first loss in ten years
…to cut 800 in-store jobs
UK: Supermarkets could face pricing probe
UK: Tesco
…appoints Master of Wine
…appoints new group brand director
…expected to reveal new investment into pension scheme
…rejects a bid for its South Korean assets
…reports £6.4bn loss
…takes over full ownership of the Euphorium bakery chain
 OTHER FOOD SPECIALISTS
UK: Community Store announces plans to expand in the UK
UK: Greggs sales grow 5.0% in Q1
UK: Holland & Barret
…to open its first US stores
…opens first Free From store
UK: Majestic Wine acquires Naked Wines
UK: Thorntons reports ‘mixed’ performance for Q3
NEWS ANALYSIS – NON-FOOD
 CLOTHING AND FOOTWEAR RETAILING
UK: Bonmarché has challenging fourth quarter
UK: Burberry revenues rise 9% in the second half of the year.
UK: Charles Tyrwhitt sales jump 20%
UK: Cuplé opens its first London store
UK: French Connection warns on sales and financial performance
UK: LK Bennett sales rise 4.4%
UK: Monsoon Accessorize suffers sales and profit decline
UK: N Brown sales flat on the year
UK: New Look
…in takeover talks
…eyed by investors
UK: Next
…chief executive pledges to raise shopfloor wages
…sales up 4.1% in Q1
UK: Shoe Zone fails to meet market expectations
UK: Shoon
…bought out
…enters Company Voluntary Arrangement
UK: SuperGroup posts 16.7% retail growth
 MULTI-SECTOR RETAILING
UK: Laura Ashely sales and profits rise in 2014
UK: Mothercare beginning to benefit from turnaround plan
UK: Poundland
…sales reach £1bn
…proposed purchase of 99p Store under scrutiny
…purchase of 99p stores faces full investigation
…brings forward review of 99p Stores deal
UK: Poundworld unveils new ecommerce website
UK: Tiger to open new store in Milton Keynes
UK: Woolworths staff lose compensation battle
 DEPARTMENT STORES
UK: BHS to expand its food offering
UK: Debenhams
…like-for-like sales rise 1.3%
…losses widen in Ireland
UK: Harrods taken over by Samsung
UK: House of Fraser
…achieves ‘record sales
…appoints Colin Elliot as new Financial Director
UK: Liberty owner shows interest in Ben Sherman
UK: John Lewis launches recruitment drive for 850 new roles
 DIY RETAILING
UK: Travis Perkins consumer division reports sales growth of 8.7%
 ELECTRICAL RETAILING
UK: Apple revenues grow 27.2% in Q2
UK: BrightHouse
…reveals new business practises
…unveils ambitious growth plans
UK: Carphone Warehouse to launch new mobile network iD next week
UK: Maplin reports strongest sales growth in seven years
UK: Phones4U creditors to receive 0.4p per pound owed
 FURNITURE AND HOMEWARE RETAILING
UK: Carpetright sales grow 5.4% in Q4
UK: Dunelm Chairman to stand down
UK: Ikea UK sees profits fall
UK: ScS reports mixed Q3 results
 HOME SHOPPING
UK: Boden announces shoppable digital catalogue
UK: Boohoo sales soar 27% in 2014
UK: Farfetch to use investment to drive growth
UK: Home Retail Group full-year sales edge up 1%
UK: Hut Group announces 39% rise in sales
UK: Made.com in funding talks
UK: Mr Porter develops sportswear offering
UK: Net-a-Porter announces new shoppable social network
UK: Ocado
…launches Apple Watch grocery app
…patents robots for picking and packing
 BOOK AND STATIONERY RETAILING
UK: WH Smith high street sales suffer again
 TOY RETAILING
UK: Hornby expects to post first profit in three years
 SPORTS AND LEISURE GOODS RETAILING
UK: Evans Cycles
…close to purchase
…acquired by ECI
UK: JD Sports revenues climb 25%
 PET GOODS RETAILING
UK: Pets at Home sales grow 9.6% in 2014
 ECONOMY
UK: Like-for-like retail sales rise 3.2% in March
UK: Retail sales rise 4.1% in March

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