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BUSINESS LIVE: Retail sales slump; FCA drops M&C Saatchi investigation; Shell blasts ‘body blow’ court ruling










British retail sales slumped in December after consumers did much of their Christmas shopping earlier than usual in November and many consumers stayed at home due to the spread of the Omicron coronavirus variant.

Sales volumes fell by 3.7 per cent from November, a far bigger hit than the 0.6 per cent decline forecast by economists and the biggest fall since January of last year when the country was under a coronavirus lockdown.

The Financial Conduct Authority has closed an investigation into advertising group M&C Saatchi, with no enforcement action to be taken.

M&C Saatchi, which earlier this month said it did not see much merit in a possible all-share takeover instigated by its biggest investor, software entrepreneur Vin Murria, has also upgraded its profit outlook.

Shell’s boss has lashed out at a landmark climate change ruling from a Dutch court that he said felt like a ‘body blow’.

Ben van Beurden said it was ‘deeply troubling’ that the oil giant was being singled out for the way the world uses energy.

>If you are using our app or a third-party site click here to read Business Live 

Compared with December 2020, sales volumes were down by 0.9%, the Office for National Statistics said on Friday.

Compared with December 2020, sales volumes were down by 0.9%, the Office for National Statistics said on Friday.

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Primark to axe 400 store managers to cut costs as sales remain below pre-pandemic levels










Primark staff were dealt a blow yesterday with news the firm will slash 400 store management jobs to reduce costs. 

The High Street discount retailer will cut the roles from its 191 UK stores in response to rising cost pressures and as sales remain below pre-pandemic levels. 

Primark employs 29,000 staff and said it will start discussions with those affected by the cuts. 

Job loses: Will cut 400 store management roles roles from its 191 UK stores in response to rising cost pressures and as sales remain below pre-pandemic levels

Job loses: Will cut 400 store management roles roles from its 191 UK stores in response to rising cost pressures and as sales remain below pre-pandemic levels

Owner Associated British Foods, which also owns Twinings and Ovaltine, added that it will increase prices amid soaring energy and supply chain costs. 

ABF said it would pass the increasing costs on to customers ‘where necessary’. Shares dropped 4.2 per cent, or 89p, to 2042p as it also warned that the soaring costs could eat into its profits. 

Group sales in the 16 weeks to January 8 were £5.6billion, up 16 per cent from a year earlier. 

Primark sales were £2.7billion, 36 per cent higher than a year earlier, but across stores they were still 5 per cent down from pre-Covid levels. 

The company said that sales were hit in December as shoppers were turned off by the spread of the Omicron variant. 

Primark was hit especially hard by reduced footfall as the retailer does not sell clothes online 

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UK businesses rocked by biggest drop in monthly sales since April 2020 as Omicron scares diners and shoppers

  • Net 6% of UK firms reported a decrease in turnover in December
  • That is the highest proportion since April 2020, at the height of first lockdown
  • But restaurant bookings picked up again in January, along with footfall in shops 










The spread of the Omicron variant left many UK companies nursing a drop in sales in December, but there are signs the economy is picking up again this month. 

In December 2021, a net 6 per cent of firms reported decreasing turnover compared to the previous month, according to the latest official figures.

That’s the highest proportion reporting a fall in monthly turnover since April 2020, when the first Covid lockdown hit the economy.

Empty seats and tables outside a bar in Covent Garden, London, on 21 December

Empty seats and tables outside a bar in Covent Garden, London, on 21 December

The Office for National Statistics said that economic surveys show average company turnovers fell 1.4 per cent between late November 2021, when Omicron emerged, and early January. 

Despite no official restrictions being imposed in the UK over the festive period, people stayed away from shops, restaurants and bars last month amid concerns over the spread of Omicron. 

Primark today announced the cut of 400 jobs as it reported a hit to sales, which fell 10 per cent in the 16 weeks to January 8 compared to two years ago. 

Similarly, Revolution Bars reported a 23 per cent fall in like-for-like sales in the last six weeks of 2021 compared to the same period in 2019, as the spread of Omicron triggered a flurry of cancellations of office parties.  

‘Sales over the Christmas period were impacted by the move to ‘Plan B’ including the return to the ‘Work From Home’ instruction, implementation of Vaccine Passports for late night bars and government messaging which unhelpfully encouraged the limiting of social interactions,’ the company said today. 

On top of concerns over Omicron, shoppers increasingly felt a squeeze on their finances as inflation rose to a 30-year high in December.

Consumer price inflation came in at a higher-than-expected 5.4 per cent in December, from 5.2 per cent in November, figures showed yesterday.

Two thirds, or 66 per cent, of UK households have reported that the cost of living has jumped last month, with rising food prices the biggest culprit, followed by energy and fuel bills, the ONS said.

Average company turnovers fell 1.4% between late November 2021 and early January

Average company turnovers fell 1.4% between late November 2021 and early January

Jackie Mulligan, founder of the local shopping platform, Shopappy, said it was ‘a panoply of pain’ for businesses.

‘The move to Plan B holed many businesses under the waterline, just when they needed a festive lift.’ 

She added: ‘Inflation at a 30-year high is hitting small high street businesses from all angles.

‘Customers have less to spend, raw materials are costing more, supply chains are being squeezed, interest rates are on the up and the cost to heat their premises is skyrocketing.’ 

Despite the gloom, there were signs that the impact of Omicron on the economy was easing in January, as infections started to drop off from record levels. 

Restaurant bookings increased by 5 per cent in the week to 17 January, with cities like London and Manchester recording a 6 per cent and 19 per cent increase respectively, according to OpenTable data cited by the ONS.

Transactions at Pret a Manger stores, which are considered a bellwether for the hospitality industry, jumped 16 per cent in the week to 13 January.

However, at 72 per cent of the average levels in January 2020, transactions are still ‘notably’ below levels in the four months before Christmas.     

The overall number of people visiting shops in the UK also increased by 2 per cent in the week to 15 January, after three consecutive weeks of declines, the ONS said, citing figures from Springboard.

Despite the increase, footfall remains at 79 per cent of the level seen in the same week in 2019. 

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Wealthy lap up luxury brands: Sales soar at Burberry and Cartier-owner Richemont as they put the pandemic behind them










Luxury brands are roaring back to life as they put the pandemic behind them.

In separate bullish updates to investors, the British fashion house Burberry and Swiss giant Richemont have reported soaring sales in the run-up to Christmas.

The figures sent shares in Burberry 6.3 per cent higher in London while Richemont, whose brands include Cartier, and Montblanc, was up 5.1 per cent in Zurich.

British fashion house Burberry said sales before Christmas were 5% higher than a year earlier as £723m of bags, hats, scarves, coats and other clothing flew off the shelves

British fashion house Burberry said sales before Christmas were 5% higher than a year earlier as £723m of bags, hats, scarves, coats and other clothing flew off the shelves

Chris Beauchamp, the chief market analyst at IG Group, said: ‘The chasm in the global economy is clearly illustrated here, as the luxury goods sector makes headway while everyone else seems to worry about the rising cost of daily essentials.’

Burberry said sales before Christmas were 5 per cent higher than a year earlier as £723million of bags, hats, scarves, coats and other clothing flew off the shelves.

Full-price sales jumped 26 per cent reflecting its move away from offering discounts, and demand for leather goods was especially strong.

The fashion house also said profits for the year to April 3 would be 35 per cent higher than last year, well ahead of City expectations of £472million. 

Finance chief Julie Brown said stores were attracting a new generation of customers, adding: ‘The brand is stronger, the product is stronger. 

‘The key product categories, leather goods and outerwear, are performing very strongly.’

In Switzerland, Cartier-owner Richemont reported its fastest Christmas sales growth in more than a decade

In Switzerland, Cartier-owner Richemont reported its fastest Christmas sales growth in more than a decade

Burberry shares rose 111p to 1866.5p. AJ Bell investment director Russ Mould said: ‘It appears the wealthy are lapping up luxury items.’

Burberry chairman Gerry Murphy said the boom would continue and its incoming chief executive Jonathan Akeroyd would inherit an ‘excellent’ position to build from. 

Akeroyd will join in April, having run Versace since 2016 and could take home £11million in his first year. 

His predecessor, Marco Gobbetti, the mastermind of the multi-year plan to reposition Burberry, jumped ship to Ferragamo this year.

Mould said: ‘Akeroyd will want to put his own stamp on the business, but he may want to consider an ‘if it ain’t broke don’t fix it’ approach given the progress under Gobbetti.’

In Switzerland, Richemont reported its fastest Christmas sales growth in more than a decade. 

The firm, which is looking to give up control of fashion website Yoox Net-a-Porter, said sales in the three months to December 31 were 32 per cent higher than the same period a year earlier, at £4.7billion. 

Jewellery sales jumped 38 per cent, fashion sales were up 37 per cent and watch sales rose by a quarter.

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Sales recovery at WH Smith’s airport and railway station stores is thrown off course by Omicron

  • WH Smith’s travel saw sales recover to 94% of 2019 levels in November 
  • The firm’s high street revenues remained relatively consistent despite Omicron
  • ‘Plan B’ curbs encouraged more working from home and less international travel 










The emergence of the Omicron variant of coronavirus put a break on improving trade at WH Smith’s outlets in airports and railway stations at the end of last year.

While spending at the retailer’s travel division in November bounced back to 94 per cent of its pre-pandemic volumes, the following month saw it decline to 83 per cent of 2019 levels.

Within its UK travel arm, monthly revenues as a percentage of 2019 levels at its airport stores jumped by 29 percentage points between September and November but fell by six points to 65 per cent in December.

Fall back: While spending at WH Smith's travel division in November bounced back to 94 per cent of its pre-pandemic volumes, December saw it decline to 83 per cent of 2019 levels

Fall back: While spending at WH Smith’s travel division in November bounced back to 94 per cent of its pre-pandemic volumes, December saw it decline to 83 per cent of 2019 levels 

Sales at shops situated in railway stations were less volatile by comparison, but still dropped from 74 per cent of pre-pandemic levels in October and November to 69 per cent in December.   

That month saw the UK Government impose its ‘Plan B’ restrictions due to rising incidences of Omicron, encouraging Britons to work from home if they could and wear face coverings in many indoor public places like shops and theatres.

But though these curbs had a major impact on purchases at WH Smith’s airport stores, revenues at its high street establishments remained relatively consistent over the last four months of 2021 and the first couple of weeks of this year.

The group said this was partly thanks to decent quantities of available stock and healthy trade at its online businesses, such as personalised cards and gifts seller FunkyPigeon.com, and stationery provider Cult Pens.

Its North American travel business held up better than the UK, with increased passenger numbers during the festive period, with bosses highlighting its Las Vegas sites in particular.

Despite troubles at its British airport locations, the company opened 16 InMotion technology accessory stores across UK air travel hubs, including Heathrow and Gatwick airports, and plans to open 14 further stores by the summer.

Travel issues: Since the pandemic started, WH Smith has suffered from steep financial losses caused by the rise of home working slashing commuting travel and the decline in

Travel issues: Since the pandemic started, WH Smith has suffered from steep financial losses caused by the lack of international travel and fewer commuters journeying on trains

Another two InMotion bases are set to open at Dublin Airport during the spring, while more are expected to open in North America, where it has won the tender for 60 sites that are due to start trading in the next three years.

Chief executive Carl Cowling said that while the company expects to incur ‘a small impact from the Omicron variant, we anticipate a resumption in the recovery of our travel markets over the coming months’.

He added: ‘We are well placed for the key trading period in Travel this summer and the ongoing recovery in our markets.’

Since the pandemic began, WH Smith has suffered from steep financial losses caused by the lack of international travel and the rise of home working leading to fewer commuters journeying on trains.

In 2020, it recorded an annual pre-tax loss of £280million even after sales from its main website soared by 240 per cent. It also closed dozens of stores and cut jobs.

Though trade recovered significantly the subsequent year as restrictions loosened and its high street division made a profit, it still made a loss of £116million.

WH Smith’s sharse took a big tumble when those results were announced, but have since recovered well and were 6.6 per cent higher at £16.55 during mid-afternoon on Wednesday. 

AJ Bell’s investment director Russ Mould said: ‘Strategically, the company has remained focused on the longer term, and there are some interesting developments that put WH Smith in a stronger place to thrive once life returns to normal.’ 

‘It has secured more stores in travel hubs, and it is rolling out an initiative whereby it houses a pharmacy within travel shops. If Covid can stop interrupting everyday life, then WH Smith arguably stands a good chance of bouncing back sharply.’

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Wellbeing brand NEOM could seek new investment to accelerate international growth after a stellar Christmas










Wellbeing brand NEOM could seek new investment this year to accelerate international growth after a stellar Christmas. 

Chief executive Oli Mennell said he was ‘ecstatic’ after sales at its own shops and website rose 35 per cent to £6.9million in the five weeks to January 2. 

And he spoke of an opportunity to grow the brand which hit £29million sales in 2020 – with products such as Perfect Night’s Sleep face cream at £42 and the Wellbeing Pod ultrasonic diffuser from £50 – to ‘hundreds of millions’ of pounds globally. 

Growth: NEOM founders Oli Mennell and Nicola Elliott are looking to the US

Growth: NEOM founders Oli Mennell and Nicola Elliott are looking to the US

Later this year, the company will look at ‘options’ that could enable him and his business partner, Nicola Elliott, to invest more heavily in US and Chinese growth. 

He said the firm can fund growth through its own money, but added: ‘The US is going phenomenally well and China is next. To go for really big, fast growth, you want to make sure you have the right funding in place.’ 

Mennell added: ‘We started the brand 17 years ago, very early into the wellbeing market. We’re now in the epicentre of a movement where there is now massive increase in consumer interest.’ 

He said the brand has also benefited from ‘a shift away from synthetics into natural ingredients’. 

Mennell said 80 per cent of products are sold online, including on other retailers’ sites. It also has five of its own shops – including in London, Guildford, Wimbledon and Leeds – and sells through Harrods, John Lewis and SpaceNK.

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Jaguar blames supply chain shortages for a collapse in sales as it looks to an electric future – but Land Rover sees sales climb










Jaguar has blamed supply chain shortages for a collapse in sales last year confirmed in its latest published figures.

The luxury car maker, which is owned by India’s Tata Motors, delivered 86,200 vehicles in 2021, down 15 per cent on the year before. 

The plunge in sales was particularly stark in the final quarter of 2021; deliveries in the three-month period to 31 December were down 48 per cent on a year earlier.

It comes as the British brand has outlined its intention to exclusively sell electric vehicles from the middle of this decade. However, sales of its lone battery model – the I-Pace – plunged last term, records show.

Sales slump: Jaguar Land Rover, which is owned by India’s Tata Motors, delivered 86,200 vehicles in 2021, down 15% on the year before

Sales slump: Jaguar Land Rover, which is owned by India’s Tata Motors, delivered 86,200 vehicles in 2021, down 15% on the year before

The Coventry-based group said it – like every other vehicle manufacturer globally – had been hit by the worldwide shortage in semiconductors, but that this was starting to ease.

The limited supply of chips has only added to Jaguar’s recent woes.

It is one of the car brands hardest hit by the huge shift away from ‘dirtier’ diesel engines in recent years, with oil burners its biggest sellers before the VW emissions cheating scandal in 2015.

Last year, bosses announced plans for the brand to become the ‘Tesla of the West Midlands’ but declaring it will become a pure electric car manufacturer by 2025.

Land Rover posted a 3.4% increase in sales in 2021, which was stark contrast to sister brand, Jaguar

Land Rover posted a 3.4% increase in sales in 2021, which was stark contrast to sister brand, Jaguar

However, it could have a struggle on its hands.

Jaguar sales for 2021 are just 9 per cent of the 936,000 cars delivered by Tesla. 

In the UK alone, Tesla sold seven of its electric vehicles to every Jaguar purchased, making the US firm the executive company car of choice in Britain last year.

As for the I-Pace, which costs from £64,000, demand had slipped by 27 per cent year-on-year with just 9,800 sold worldwide. 

That’s a near 50 per cent decline on I-Pace sales in 2019.

Jaguar has set out its intention to become a luxury electric car maker from 2025, though 2021 sales of its only existing EV - the £65,000 I-Pace (pictured) - fell by a massive 27% year-on-year

Jaguar has set out its intention to become a luxury electric car maker from 2025, though 2021 sales of its only existing EV – the £65,000 I-Pace (pictured) – fell by a massive 27% year-on-year

On the flipside, Jaguar’s sister brand, Land Rover, saw a small sales increase, rising by 3 per cent to over 334,500 units for the calendar year.

Much of this was down to appetite for the recently-revealed new Range Rover and the ever-popular Defender 4X4.

This is despite significant lead times for both models – particularly the Defender, which has a 12-month waiting list for particular examples of the utilitarian offroader.

Jaguar Land Rover is the biggest car maker in the UK with around 30,000 employees.

Commenting on previous quarter sales, Lennard Hoornik, JLR’s Chief Commercial Officer, said: ‘The New Range Rover is the embodiment of Jaguar Land Rover’s vision for Modern Luxury by Design. We are delighted that positive feedback at launch has led to a strong order intake for this first all new modern luxury model. 

‘Furthermore, the Land Rover Defender continues to contribute to a record order bank next to our all electric Jaguar I-Pace. 

‘Semi-conductor supply challenges continue within the industry but our wholesale volumes are improving. We look forward to completing delivery to global customers as supply improves in 2022.’ 

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Pub chain Mitchells & Butlers sales slump as hospitality industry bosses bemoan a ‘lost Christmas’










Pub chain Mitchells & Butlers saw sales slump over the festive period as industry bosses bemoaned a ‘lost Christmas’.

The firm said sales in the four weeks to January 8 were 10.2 per cent lower than in the same period in 2019, pre-pandemic.

It meant sales in the first quarter of the financial year – the 15 weeks to January 8 – were down 1.5 per cent. 

Omicron effect: Pub chain Mitchells & Butlers said sales in the four weeks to January 8 were 10.2% lower than in the same period of 2019 before the pandemic struck

Omicron effect: Pub chain Mitchells & Butlers said sales in the four weeks to January 8 were 10.2% lower than in the same period of 2019 before the pandemic struck

But chief executive Phil Urban was upbeat: ‘We are encouraged by the data on the Omicron variant which we believe will boost consumers’ confidence to return to pubs and restaurants,’ he said. 

Shares rose 1 per cent, or 2.4p, to 260p.

The figures from M&B, which runs around 1,700 pubs under brands such as Harvester, All Bar One and Toby Carvery, came as data laid bare the Christmas chaos caused by Covid

Around 3 per cent of the workforce, or 1m people, were off work due to Covid at the end of December, while 21 per cent of businesses reported increased cancellations.

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Jaguar Land Rover blames supply chain shortages for a collapse in sales as it looks to an electric future










Jaguar Land Rover has blamed supply chain shortages for a collapse in sales.

The luxury car maker, which is owned by India’s Tata Motors, delivered 86,200 vehicles last year, down 15 per cent on the year before. 

The plunge in sales was particularly stark in the final quarter of 2021. Deliveries in the three-month period were down 48 per cent on a year earlier.

Sales slump: Jaguar Land Rover, which is owned by India’s Tata Motors, delivered 86,200 vehicles in 2021, down 15% on the year before

Sales slump: Jaguar Land Rover, which is owned by India’s Tata Motors, delivered 86,200 vehicles in 2021, down 15% on the year before

The Coventry-based group said it had been hit by the worldwide shortage in semiconductors, but that this was starting to ease.

However its Range Rover and Land Rover brands bucked the trend – with sales rising by 3 per cent.

Jaguar Land Rover is the biggest car maker in the UK with around 30,000 employees.

Chief executive Thierry Bollore, who took over in late 2020, has launched a ‘Reimagine’ strategy to turn the company into Britain’s leader in electric cars.

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Marks and Spencer celebrates its best ever Christmas as Rosie Huntingdon-Whiteley puts spark into bra sales










Marks and Spencer celebrated its best ever Christmas as it became the UK’s fastest growing grocer and bras flew off the shelves.

Food sales in the three months to January 1 were 10 per cent higher than a year earlier – leaving rivals including Tesco and Aldi in its wake.

And in its clothing and home arm sales were up 37.7 per cent on 2020 and, crucially, 3.2 per cent higher than in 2019.

On trend: Sales of bras – including lines designed by model Rosie Huntingdon-Whiteley (pictured) – were 40% ahead of 2020 and 13% up from 2019

On trend: Sales of bras – including lines designed by model Rosie Huntingdon-Whiteley (pictured) – were 40% ahead of 2020 and 13% up from 2019

M&S enjoyed a record-breaking quarter for lingerie as women flooded back to stores for bra fittings once lockdowns eased.

Sales of bras – including lines designed by model Rosie Huntington-Whiteley – were 40 per cent ahead of 2020 and 13 per cent up from 2019, with its Bluewater store in Kent fitting around 650 women every month. 

Chief executive Steve Rowe hailed a ‘strong’ Christmas for M&S, adding: ‘I remain encouraged that our transformation plan is now driving improved performance.’ 

Signs of recovery at M&S had seen shares almost triple since their pandemic low in mid-2020. But the stock fell 8 per cent, or 20p, to 233p yesterday as it warned of a ‘tricky balance’ to manage increasing costs.

M&S said that while it was working hard to keep prices down, it was inevitable that some rises would be passed on to customers.

The 138-year-old retailer has more than 1,000 shops in the UK including more than 700 Simply Food shops.

Across the group sales hit £3.3billion, an 18.5 per cent jump from last year and 8.6 per cent above pre-Covid levels.

It led to an upgraded forecast and the retailer said profits for the year to April 2 would now be ‘at least £500million’. It is its third profit upgrade in the last six months.

Food sales were buoyed by festive specials as M&S sold more than a million bottles of its light-up snowglobe gin and more than a million flashing shortbread tins.

The strong performance in clothing, which has struggled with declining sales for years, saw sales top £1billion. 

While in-store sales were 10.8 per cent below 2019 levels, online purchases were 50.8 per cent higher. 

Shore Capital retail analyst Clive Black said: ‘The bottom line is M&S food sales are very strong and people now want to buy M&S clothes.’

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