Mixed results for UK retailers
September, but the Big Food Group's overall results were buoyed by
a solid performance from its Booker wholesale unit. M&S,
meanwhile, saw good food sales growth during the same period.
Two of the UK's food retailers have issued trading statements this week, with very differing results. Sales at the Big Food Group's Iceland supermarket chain fell 7.7 per cent in the 13 weeks to the end of September, while food sales at Marks & Spencer were up 6 per cent in the 12 weeks to the same date.
BFG said that Iceland had continued to suffer from a weak sales performance during the period, although the company was taking action to boost margins. There was also a good performance from the chain's newly-refurbished stores, with like-for-like sales growth averaging 14.7 per cent, which the company said showed that "this strategic initiative will deliver a step change in performance".
There was better news from BFG's other divisions, however. The Booker wholesale division posted a slight 0.9 per cent rise during the period despite an overall slowdown in the market, and this unit accounted for around 70 per cent of BFG's sales during the period. The launch of two new initiatives - the Delivery Hub, a specialised delivery site providing enhanced service for the delivery business, and the Drop Shipment programme, which involves direct delivery, to customers, of products like bread and milk that are needed daily - both generated increased sales.
The Woodward foodservice unit performed very well, seeing sales rise 13.5 per cent during the 13 weeks, helped by the opening of an ambient pick centre at Rhyl offering the Booker range of products, including Chef's Larder, to its customers in Wales and the northwest of England.
BFG chief executive Bill Grimsey said: "Following our statement in July, our wholesale business continues to make good progress. I'm particularly pleased that margins at Iceland were quickly restored, whilst the initiatives we have developed to improve sales are being implemented in store. The implementation of the strategic initiatives within the group is making good progress."
Meanwhile, the picture was somewhat rosier at M&S, which has also had its share of problems in recent years. Food sales at the group were up 6 per cent on a like-for-like basis and 7.5 per cent overall, contributing to total group sales increases of 10 per cent and 11.1 per cent respectively.
M&S's share of the food market increased during the period, helped, it said, by the high quality of its products, continued innovation and strong, cohesive marketing.
Roger Holmes, M&S chief executive, said he was pleased with the results. "The improvements made to date in clothing appeal, store ambience, food innovation and home product have been appreciated by our customers and are delivering results. We expect high street conditions to normalise as the year progresses but we know we can do even more to create a better shopping experience for our customers and to recover lost ground."
