The gloomy mood on the British high street was lightened by unexpectedly strong figures from high street retailers Jessops and JD Sports, while home shopping operator Shop Direct also put in a creditable performance.
The gloomy mood on the British high street was lightened by unexpectedly strong figures from high street retailers Jessops and JD Sports, while home shopping operator Shop Direct also put in a creditable performance.
After a particularly poor November for most of the high street, evidence is emerging that trade picked up in December and that spending was particularly free in the post-Christmas sales as shoppers sought bargains.
Camera retailer Jessops surprised the market by reporting a rise in underlying Christmas sales. Like-for-like sales in the five weeks to January 5 were up 3.1% on the year. This provided some relief to investors who saw the company's shares battered this year particularly after its usual summer sales surge failed to materialise.
However, Jessops appears to have been affected by cost-cutting on the high street. It warned yesterday that "margin has been affected by the challenging market conditions for retailers".
Its shares traded as much as 69% higher before closing up 0.56p at 3.31p, a 20.4% gain on the day.
Two years ago they were changing hands for closer to 150p.
JD Sports's shares also fared well, gaining 22.5p, 11%, to 227.5p yesterday after reporting it would beat profit forecasts of between £47m and £48m.
The company has repeatedly reported rising sales and profits this year as the rest of the high street ailed.
The 27-year-old company reported like-for-like sales growth of 2.8% during the five weeks to January 3 compared to the same period last year, which was itself 9.6% up.
JD Sports also maintained margins by delaying discounting until Boxing Day. Much of the high street started its sales before Christmas in an effort to kick-start festive spending.
Cumulatively like-for-like sales at the chain's 400 stores for the 48 weeks to January 3 rose 3.8%, with gross margins marginally up.
"The board now believes that the current market expectations for profit before tax and exceptional items will be marginally exceeded," it said.
There was further good news from home shopping company Shop Direct, formerly Littlewoods Shop Direct.
It said its sales had increased 9% over the six weeks to January 2.
The company said it saw significant growth in women's fashions and electrical products and that stock levels going into the end-of-season sale were 10% lower than last year.
Its online sales during the period were up 44% and now account for 56% of sales.
"We believe the retail outlook in 2009 will be difficult," said chief executive Mark Newton-Jones.
Department store chain John Lewis provided further evidence of a post-Christmas boom reporting that its department store sales surged by 27.4% year-on-year in the week to January 3. Sales of electricals and home technology rose 39.7% year-on-year, while fashion was up 34.4%.
But Howard Archer of IHS Global Insight warned: "Once the best of the bargains are gone and consumers have got what they most want or need, we suspect that interest in the sales will fall away quickly."
