Christmas bonanza for Tesco and M&S as consumers splash out

Tesco and Marks & Spencer have emerged as Christmas winners as consumers flocked to their shops regardless of strain on household funds.

Both posted bumper figures amid robust demand for premium vary meals and garments.

Tesco mentioned gross sales within the six weeks to January 6 had been 6.8 per cent larger than a 12 months earlier, whereas M&S reported an 8.1 per cent leap within the 13 weeks to December 30.

M&S chief government Stuart Machin, who has overseen a exceptional turnaround in fortunes below chairman Archie Norman, mentioned it was getting into 2024 with a ‘spring in our step’.

Ken Murphy, his counterpart at Tesco, mentioned the nation’s largest grocer was ‘in great shape to keep delivering for customers’.

The updates positioned Tesco and M&S firmly among the many Christmas retail winners alongside Aldi, Lidl, Next and Sainsbury’s.

Others have struggled, nonetheless, with JD Sports final week reporting disappointing gross sales.

Chris Beckett, head of fairness analysis at Quilter Cheviot, mentioned this week’s updates paint ‘a good picture of the British consumer’.

But he warned the resilience has not been felt by each retailer.

He mentioned: ‘Tesco and M&S have followed up Sainsbury’s comparatively optimistic Christmas replace with a little bit of festive cheer.

‘They have delivered good results and are taking market share. 

Christmas boost: Tesco said sales in the six weeks to January 6 were 6.8% higher than a year earlier

‘With Sainsbury’s claiming the identical, the non-public equity-backed supermarkets, Asda and Morrisons, should nonetheless be struggling and never having fun with the identical positivity.’

Tesco nudged its annual revenue steerage larger to £2.75billion, up from a variety of £2.6billion to £2.7billion.

Although its shares rose yesterday morning, they had been dragged down later within the day as the grocery store was amongst these to voice considerations about assaults within the Red Sea.

Murphy mentioned if delivery continued to be diverted, freight prices would improve and this ‘could drive inflation on some items, but we just don’t know’.

But he had optimistic hopes for shopper spending energy at residence. 

As inflation continues to ease, he mentioned that he was ‘cautiously optimistic’ in regards to the financial outlook, so long as robust employment ranges maintain up.

 He mentioned Brits opted for dearer get together meals at Christmas as they wished to rejoice after ‘tough year’ nevertheless it was ‘too early’ to say whether or not the price of residing disaster was over.

Sales of its premium own-label vary, Tesco Finest, swelled by nearly 17 per cent. 

And it bought over 32m pigs in blankets and 6.6m bottles of prosecco, with December 22 being its busiest day for Christmas consumers. Tesco shares closed down 1.4 per cent, or 4p, at 292.4p yesterday.

Such was the load of expectation within the run-up to yesterday’s figures, that M&S shares additionally fell regardless of the optimistic replace, dropping 5.2 per cent, or 14.4p, to 263.3p.

Once condemned for dowdy style ranges, the enterprise noticed a 4.8 per cent rise in clothes and residential gross sales over the 13-week interval, whereas its meals gross sales had been up 9.9 per cent.