Tesco and Marks & Spencer were both Christmas winners with unexpectedly strong sales helped by growth in online orders and high demand for festive treats.
The UK’s biggest supermarket, Tesco, upgraded its profits expectations for the year by £50m to £2.75bn as it reported “a stronger trading performance than anticipated” over the festive period.
Sales rose by 6.8% at the group’s UK supermarkets in the four weeks to Christmas helping the whole group, which also has a wholesale business, Booker, and supermarkets in central Europe and Ireland, lifting sales by 6%.
Ken Murphy, the chief executive of Tesco, said: “We stepped up our investment in service over the key festive period, with more colleagues on the shop floor, helping to deliver market-leading availability and making this our best Christmas yet.”
He said sales of the group’s premium own-label Finest range had risen by nearly 17% but it had also drawn in shoppers with thousands of price cuts. Online sales rose by 11.5%, bouncing back from the more difficult period for the online trade which took a hit as the huge popularity during the pandemic lockdowns dampened down.
Marks & Spencer said food sales in established stores rose by almost 10% as more shoppers opted to do their full weekly shop with the chain after it cut prices on basics. Sales of the group’s Remarksable value range were up by 18% with strong growth in meat, poultry, produce, grocery and in-store bakery.
Clothing sales at established stores were up by 4.8% as M&S said it had discounted fewer items with womenswear sales particularly strong as the company improved its style credentials. Knitwear, denim, and the brand’s premium Autograph line performed well. M&S clothing online sales grew by 10.9%, the company said.
Stuart Machin, the chief executive of M&S, said: “Our strategy to reshape M&S for growth has enabled sustained sales momentum across food and clothing & Home over the Christmas period. We enter 2024 with a spring in our step, but clear eyed on the near-term challenges.”
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