UK Retail Briefing - July 2012

ANALYST COMMENT
What’s wrong with M&S?
What is being done about it?
HEADLINES FOR THE MONTH
Grocers
Off-licences
Clothing retailing
Mixed goods retailing
DIY Retailing
Electrical Goods Retailing
Carpet Retailing
Furniture Retailing
Homewares Retailing
Home Shopping
Health and Beauty Retailing
Multi-Sector Retailing
Sports and Leisure Goods Retailing
Toys and Games Retailing
Books and Stationery
Economy
RETAIL SALES – BACKGROUND AND OUTLOOK
Key points
Retail sales trends
Figure 1: Retail sales trends, 2011-12
The BRC data for June
Figure 2: UK retail sales y/y growth, BRC vs ONS, 2010-12
John Lewis
Figure 3: John Lewis: Year-on-Year Growth, 2011-12
Inflation and wages
Figure 4: RPI vs Average Weekly earnings growth, 2008-2012
Inflation
Figure 5: Annual percentage change in the consumer price index for selected product groups, 2011-12
Looking forward
SECTOR FOCUS: CLOTHING AND FOOTWEAR SPECIALISTS
Mintel’s Tracker survey
Figure 6: Mintel Tracker: Trends in what extra money is spent on, May 2010 – May 2012
Figure 7: Mintel Tracker: Percentage of consumers spending extra money on jewellery/ clothing/ personal items, May 2010 – May 2012
Sector relatives
Figure 8: Clothing and footwear specialists’ sales as percentage of all retail sales, 2007-11
Figure 9: Clothing/footwear specialists’ shares of all consumer spending on clothing/footwear, 2007-11
Retail sales data
Figure 10: Clothing and footwear specialists’ sales and forecast, 2007-12
Consumer spending
Figure 11: Consumer spending on selected categories, 2007-11
Inflation
Figure7: Clothing and footwear: Consumer prices index, annual % change, May 2011 – May 2012
Figure 8: Year-on-year change in average global cotton prices, Jan 2011 – Jun 2012
Leading specialists
Figure 9: Leading clothing specialists, by revenues 2010/11
Figure 10: Leading footwear specialists, by revenues 2010/11
UK NEWS ANALYSIS
 GROCERS
Aldi to improve and extend own-label offering
Asda
…opens George pop-up shop
…opens its first George franchise
…signs deal to support rapid growth of Asda Direct
…to launch financial services
Booker acquires Makro UK
Iceland
…reports 18.5% rise in profits
…to present findings of customer feedback programme
Morrisons
…explores opportunities to expand convenience stores
…to lose group finance director
Sainsbury’s
…purchases HMV’s stake in e-book business
…reports sales boost
Spar to be new supplier to People's Supermarket
Tesco
…and Dobbies submit plans for joint store
…buys WE7 digital music platform
…looks for UK commercial director
…reports decline in sales
…reshuffles clothing business again
…to open 24 hours on Sundays during Olympics
…to use Clubcard data for online strategy
…works with Facebook on promotion
The Co-operative
…completes roll out of replenishment system
…launches tie-up with Amazon lockers
Whole Foods UK reports increasing losses
 OFF-LICENCES
Majestic Wine reports profit and sales boost
 CLOTHING RETAILING
Bhs poaches M&S menswear trading director
Boux Avenue plans overseas expansion
Cecil Gee to leave the high street
Coast opens doors on London flagship
Dalvey looks to expand store portfolio
Gio Goi closes all high street stores
H&M launches pop-up sportswear shops
Inditex buys UK flagship store for Zara
Issa London to launch ecommerce site
Jaeger poaches Aurora Fashions former president
Jigsaw takes over a third of Kew 159’s store portfolio
Kookaï lose sales but reduce losses
Matalan reports falling EBITDA
Mulberry
…expected to report 50% increase in profit
…reports 54% rise in profits
New Look
…extends refinancing
Radley to open first pop-up shop
Republic to boost footwear offer with dedicated areas
Superdry to boost e-commerce site and launch mobile app
Ted Baker reports revenue boost
The Kooples backs out of UK property deals
Tom Ford to open first UK standalone store
Topshop
…appoints former Burberry vice-president of PR as chief marketing officer
…to collaborate with JW Anderson
Weird Fish seeks to boost presence
 FOOTWEAR RETAILING
Dr Martens
…hopes for £200 million bidder.
…may be acquired by Russian billionaire
Jimmy Choo reports pre-tax profits rise
Jones Group to expand in Europe
 MULTI-SECTOR RETAILING
Home Retail Group post mixed quarterly results
Laura Ashley records 5.4% growth in like-for-likes
Marks & Spencer
…Bostock to leave
…confirms Bostock's departure and reports sales down in Q1
Next to open second superstore
 MISCELLANEOUS SPECIALISTS
Halfords looks to explore fast-delivery options
Kiddicare receives new design concept
Lonely Planet to open first UK store
Mothercare UK retail head to exit
The Garden Centre Group to develop more concessions
Thorntons needs to change strategy, says former chairman
 MIXED GOODS RETAILERS
Poundland
…reports record results
…tests contactless payment
Wellchester to close down
 DEPARTMENT STORES
Allders fall into administration
Debenhams
…reports sales rise as margins are hit
…to introduce next day delivery in 2013
…to launch free in-store wifi
Fenwick’s Bond Street store managing director passes away
Fortnum & Mason hires new retail director
Harvey Nichols to expand ecommerce
John Lewis looks to extend its click-and-collect service by partnering with corner shops
 DIY RETAILING
B&Q launches new services as part of Energy Saving initiative
Topps Tiles
…reports like-for-like sales up 2.1%
…to launch new flagship
Wickes to invest £10 million to lower prices
 ELECTRICAL GOODS RETAILING
Dixons reports rising profits and new strategic priorities
Maplin invests £40m into business
Phones 4u reports boost in sales, but fall in earnings
 MUSIC AND VIDEO GOODS RETAILING
Digital video sales overtake Blu-ray
 CARPET RETAILING
Carpetright reports fall in profit
United Carpets commences store closure review
 FURNITURE RETAILING
BrightHouse EBITDA up 12.8%
DFS reports market share growth but sales fall
Oka reports rising profits
 HOMEWARES RETAILING
Cath Kidston expands its UK store portfolio
Clas Ohlson opens UK transactional website
Dunelm reports like-for-like sales rise
 HOME SHOPPING
Asos
…sales up 31% in Q1
…to lose Superdry clothing brand from site
Boodles launches new e-commerce site for international distribution
Celtic Sheepskin to launch international websites
eBay appoints Sainsbury’s digital and cross channel director as vice president
Findel enjoys increase in pre-tax profit
IndiaCoco launched as new online kidswear store
N Brown sees womenswear sales hit due to wet weather
Ocado
…reports 12% increase in sales
…to launch category-specific general merchandise sites
Shop Direct acquires banking boss as new chief executive
The Hut reports 71% increase in sales
Zalando hopes for strong growth
 HEALTH AND BEAUTY RETAILING
Boots
…and Walgreens global strategic partnership
…to return to UK stock market
Chanel to open pop-up fragrance and beauty store
Holland & Barrett reports rising profit as Julian Graves goes under
Savers looks to be back in black after turnaround
 BOOKS AND STATIONERY RETAILING
Clinton Cards
…to be revamped
…to lose 122 stores
UK: WHSmith reports decline in sales
 SPORTS AND LEISURE GOODS RETAILING
JD Sports expects Black losses to total £10 million for 2012
JJB Sports
…sales fall as Euro 2012 fails to increase spending
…signs exclusive deal with Tekkers
Pentland Group boosted by international sales
 TOYS AND GAMES RETAILING
Disney Store reports further losses
Hamleys close to Ludendo purchase
 ECONOMY
BRC: June retail sales boosted by Jubilee
Co-op economy outperforms UK’s for fourth consecutive year
Consumer confidence flat in June despite Jubilee expectations
Government fuel duty freeze "helpful" for retailers
Olympics to boost economy by £5.33bn
ONS: Retail sales values and volumes increase in May
Rate of inflation fell in May
Shop price inflation falls to lowest rate in over two years
Supermarkets to launch mobile police stations
Tesco and Morrisons continue to lose out on market share
Three quarters of retailers begin summer Sale
Welsh Retail Consortium launched