Britain's biggest clothing retailer, Marks & Spencer Group, showed today that its recovery is gaining momentum as third-quarter sales covering the all-important Christmas season beat expectations.
The 122 year-old retail icon which has recently begun outperforming the competition, delivered like-for-like sales growth of 2.9% in the 13 weeks to December 31 compared with top estimates of around 2%.
The result was boosted by a much stronger-than-expected performance from food sales rather than the more profitable clothing side of the business. Non-food like-for-like sales rose 0.8%, in line with forecasts. Like-for-like food sales jumped 5.1%.
In the second quarter, comparable sales had risen 1.3% - the first rise for eight quarters, although the non-food sales trend was still negative at that time.
A cold snap boosted subdued clothing sales in Britain just in time for Christmas and M&S was hotly tipped to have outperformed rivals such as Next.
Chief Executive Stuart Rose, who was parachuted into M&S in 2004 to fend off billionaire Philip Green's £9.1 billion sterling hostile bid, had cut back orders to minimise costly markdowns and secured better buying terms to boost profit margins.
M&S said full-price sales of non-food were up 5.3% this quarter compared with a 0.4% gain in the second quarter. Clearance stocks were 35% lower than last year.
However, Rose cautioned that he expected the market to remain tough after a dreadful year for most in the industry. 'Costs of fuel, utilities, rent and rates have risen sharply and will have an impact next year,' he said.
