UK Retail Briefing - April 2006

ANALYST COMMENT
 E-COMMERCE: DSG INTERNATIONAL
Pixmania
Goodbye Dixons
Strategy
The future for stores
Seamless integration
THE MONTH IN UK RETAILING
 CONVENIENCE STORES
Expansion looms for 99p Stores
 GROCERS
Asda Essentials store launched
Sainsbury's
…completes refinancing plan
…as sales continues to grow
…and marquees roll out
 CLOTHING RETAILING
Actif calls in administrators
Alexon continues to struggle
Asos appoints two to board
Austin Reed
…agrees sale and lease-back deal
…reporting profit up, turnover down
Revenue rises at Burberry
Strong start for Moss Bros
UK like-for-likes down at Mothercare
 MULTI-SECTOR RETAILING
GUS announces ARG/Experian demerger timescale
Boots
…full-year boosted by Q4 sales
…with plans for midnight pharmacies
…and revamped Advantage Card
HMV’s Ottakar’s bid provisionally cleared
Laura Ashley sees profit rise, sales fall
Marks & Spencer
…sells Kings business
…and shares its wealth with staff
…confirming excellent progress
Next to make TV debut
 DIY RETAILING
Topps Tiles warns on profit, like-for-likes
 ELECTRICAL RETAILING
DSG
…moves Dixons brand online
…and snaps up Pixmania
Jessops updates trading, announces Hine’s departure
3 in major store expansion
 MUSIC AND VIDEO GOODS RETAILING
Silverscreen falls into administration
Online rental firms agree merger
 FURNITURE RETAILING
Land of leather reveals full-year sales rise
ScS up despite Easter effect
Inditex plans UK furniture launch
 BOOK AND STATIONERY RETAILING
Ottakar’s posts full-year pre-tax loss
WH Smith
…posts interim results, announces split
…and introduces fresh fruit
 SPORTS AND LEISURE GOODS RETAILING
Sports World posts jump in sales and profit
 MISCELLANEOUS SPECIALIST RETAILING
Halfords sees full-year sales rise
EXECUTIVE APPOINTMENTS
Arcadia directors quit
Ronny Helvey appointed marketing director at Adams Childrenswear
Kingfisher unveils board appointment
Brown to leave Wilkinson
Bhs makes trading director redundant
WH Smith appoint marketing chief for travel division
MFI marketing chief quits
Asos appoints two to board
Tesco
…convenience boss in line for Morrisons top job
…and director defects to Somerfield
Morris back on top at Marchpole
Borders UK gets new finance director
Asda clothing boss heads for Dutch M&S
PRODUCT DEVELOPMENT – BAKED GOODS
 ASDA
 MARKS & SPENCER
 WAITROSE
 SOMERFIELD
 SAINSBURY’S
 TESCO
ADVERTISING NEWS
 NEW CAMPAIGNS
TK Maxx thinks Big
Avon set for UK push
B&Q ends title sponsorship of Ellen MacArthur
Morrisons to end SFA sponsorship
Ann Summers risque viral campaign
Topman sponsoring Xfm Manchester's Access All April
Woolworths launches Easter ad drive
 ACCOUNT GAINS/LOSSES
Ethel Austin hires Mason Media for consumer push
Kwik Save appoints the Think Tank
Gap launches media planning review
Mother and Selfridges split
GameStation reviewing media account
Morrison signs up Rothschild as new adviser
Mango holding media account review
Glassesdirect.com appoints Sledge for regional task
RETAIL ADVERTISING REVIEW
 ADVERTISING EXPENDITURE
Figure 1: Total advertising expenditure by all advertisers (£m), Feb 2002-Feb 2006
Figure 2: Total advertising expenditure by all retail advertisers (£m), Feb 2002-Feb 2006
 USE OF MEDIA
Figure 3: Use of media by retail and all advertisers (%), Feb 2005 and Feb 2006
Figure 4: Use of media by retail and all advertisers (£m), Feb 2005 and Feb 2006
 TOP 25 RETAIL ADVERTISERS
Figure 5: Top 25 retailers by adspend (£), Jan 2006-Feb 2006
Food
Furniture
Other
Nielsen Media Research/Definitions
RETAIL SALES AND INFLATION
 RETAIL SALES
Office for National Statistics
Figure 6: Retail sales trends: March 2005-March 2006
Figure 7: Non seasonally adjusted % value change on previous year, Mar 2005-Mar 2006
Figure 8: Seasonally adjusted % volume change on previous year, Mar 2005-Mar 2006
Significant features of the latest ONS statistics
Confederation of British Industry
British Retail Consortium/KPMG
 RETAIL PRICE INFLATION TRENDS
Figure 9: Annual percentage change in retail price index for selected product groups: Mar 2005-Mar 2006
Figure 10: Annual percentage change in retail price index for selected product groups: Mar 2005-Mar 2006
Retail Prices Index
Consumer Prices Index
British Retail Consortium: Shop Price Index
SECTOR ANALYSIS – MIXED GOODS
 SALES TRENDS
Figure 11: Mixed goods retailers, sales trends, 1997-2006 Q1
Figure 12: Mixed goods retailers as % of all retail sales: 1997-2005
 BREAKDOWN OF SALES BY SUB-SECTOR
Figure 13: Mixed goods retailers, breakdown of sales by sub-sector, 2000-05
 RETAIL PRICE INFLATION
Figure 14: Indices of retail prices for product categories, 2000-05 (Jan 1987=100)
 CONSUMER EXPENDITURE
Figure 15: Consumer expenditure on selected product categories (£m), 1999-2005
 LATEST TRENDS
Figure 16: Mixed goods retailers’ sales (£m), 2002-05
Christmas
Debenhams
House of Fraser
Instore
Woolworths
SECTOR NEWS REVIEW: MIXED GOODS RETAILING
November
 VARIETY STORES
GUS announces demerger plans
 DEPARTMENT STORES
Debenhams delivers the goods on full-year
Fortnum to revamp flagship store
OFT accuses HoF/Oakley
December
 DEPARTMENT STORES
Allders revives furniture brands
F&M down on full-year
Beauty sales boost Harrods
Selfridges solid in 2005
John Lewis own-brand to take off
January
 VARIETY STORES
Woolworths posts festive sales fall
 DEPARTMENT STORES
Festive triumph for Harvey Nichols
Dickins & Jones shuts up shop
Trading picks up at HoF
Liberty makes festive gains
February
 VARIETY STORES
Baugur ups Woolworths stake
 DEPARTMENT STORES
Beale posts “unacceptably low” profit
Harvey Nichols to branch into fashion
House of Fraser gets cash boost
John Lewis results impress
March
 VARIETY STORES
Woolworths@Comet hits high street
 DEPARTMENT STORES
Beales acquires Horsham site
House of Fraser
…stalked by Apax
…which pinned hopes on Coleman
…but as like-for-likes fell
… bid talks came to an end
John Lewis
…trials Carphone Warehouse offer
…and reveals strong year
April
 VARIETY STORES
Woolworths
…sees Baugur investment increase
…but sees sales slip
 DEPARTMENT STORES
Debenhams plans £3 billion flotation
Baugur renews interest in HoF
Liberty happy with interim results
SECTOR ADVERTISING REVIEW – MIXED GOODS
 ADVERTISING EXPENDITURE
Figure 17: Total advertising expenditure by mixed goods retailers, February 2002-February 2006
 USE OF MEDIA
Figure 18: Use of media by mixed goods retailers and all retailers (%), February 2002-February 2006
Figure 19: Use of media by mixed goods retailers and all retailers (£m), February 2002-February 2006
 TOP TEN MIXED GOODS RETAIL ADVERTISERS
Figure 20: Top ten mixed goods retailers by adspend, February 2005-February 2006
 RETAILER FOCUS
Argos
Figure 21: Argos, media use by adspend and as share of total, February 2005-February 2006
Figure 22: Argos, top five brands by adspend, February 2006
Boots
Figure 23: Boots, media use by adspend and as share of total, February 2005-February 2006
Figure 24: Boots, top five brands by adspend, February 2006
Woolworths
Figure 25: Woolworths, media use by adspend and as share of total, February 2005-February 2006
Figure 26: Woolworths, top five brands by adspend, February 2006
Debenhams
Figure 27: Debenhams, media use by adspend and as share of total, February 2005-February 2006
Figure 28: Debenhams, top five brands by adspend, February 2006
Nielsen Media Research/Definitions
REPORT FOCUS: UNDERWEAR RETAILING
 CONSUMERS: WHO, WHERE AND WHY
Figure 29: All retail sales, at current and constant 2000 prices, 2000-05
Figure 30: Sales through clothing retailers, at current and constant 2000 prices, 2000-05
Figure 31: Sales through non-specialist, non-food retailers, at current and constant 2000 prices, 2000-05
Figure 32: UK retail sales of all women’s underwear at current and constant prices and bras and pants, by value, at current prices 2001-05
Figure 33: UK retail sales of men’s underwear, by value, 2001-05
Figure 34: UK retail sales of hosiery, by value, 2001-05
Figure 35: UK retail sales of nightwear, 2001-05
 CONSUMER EXPENDITURE
Men’s underwear and socks
Figure 36: Expenditure in last year on underwear/socks for men, by men, 2001-05
Figure 37: Expenditure in last year on underwear/socks for men, by women, 2001-05
Women’s underwear
Figure 38: Women’s underwear buying trends, 2003-05
Figure 39: Women’s expenditure on bras, briefs and ‘other lingerie’, 2003-05
Hosiery
Figure 40: Women’s hosiery purchasing, number of pairs bought per month, 2003-05
 CONSUMERS AND UNDERWEAR
Varity stores lead in women’s underwear…
Figure 41: Estimated distribution of bras and pants/briefs, 2003 and 2005
…and in men’s
Figure 42: Estimates UK retail sales of men’s underpants and vests, by type of outlet, 2003 and 2005
Grocers dominate women’s hosiery…
Figure 43: Estimated UK retail sales of hosiery, by type of outlet, 2003 and 2005
…but not men’s
Figure 44: Estimates UK retail sales of socks, by type of outlet, 2003 and 2005
M&S rules nightwear
Figure 45: UK retail distribution of nightwear, by type of outlet, 2003 and 2005
 PROFILES OF UNDERWEAR RETAILERS
Marks & Spencer
Figure 46: M&S: UK retail sales by merchandise category, 2003/04 and 2004/05
Figure 47: M&S good, better, best structure for lingerie, October 2005
Primark
Figure 48: Primark, financial performance, 2000-04
Figure 49: Primark, outlet data, 2001-05
Specialists
Figure 50: Underwear and hosiery retailer specialists – key statistics
La Senza
Figure 51: La Senza Ltd, financial performance, 2000-05
Contessa
Figure 52: Contessa (Ladieswear) Ltd, financial performance, 2000-05
Sock Shop
Ann Summers
Figure 53: Ann Summers Ltd, financial performance, 2000-04
Agent Provocateur
Bravissimo
Myla
Figleaves
 INDUSTRY VIEWS
A challenging year?
Is the China Crisis over?
Is competition from value players a key challenge?
Is fashion most important?
2005 saw significant consolidation – what are the prospects for 2006?
 WHERE DOES UNDERWEAR GO FROM HERE?
Figure 54: Forecast of UK retail sales in underwear, 2005-11