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M&S predicts tough 2008 as like-for-like sales fall

Published:  23 July, 2008

Marks & Spencer saw like-for-like sales in the UK fall by 2.2% over the 13 weeks to December 29 2007, with like-for-like food and drink sales down by 1.5%.

General merchandise sales were down by 3.2% on a like-for-like basis.

Overall, group sales were up 2.8%, and UK sales up 2%.

Food and drink sales overall were up by 5.1%, but general merchandise was down by 0.7%.

International sales were up by 15%.

Chief executive Sir Stuart Rose said: "Market conditions became more challenging through November and December. We continued to drive footfall, and volume growth in general merchandise was strong at 5%.

"Price deflation was 6%, reflecting our continued focus on offering customers better values. We held market share in general merchandise at 10.6% and in food at 4.3%.

"We did not discount in the run up to Christmas. Stock levels were well controlled over the period. We had a strong start to the Christmas Sale and sale stocks have now cleared."

Website sales for the group were up 78% with a growth in customer numbers and transactions in this regard.

He added: "We expect trading conditions to remain tough throughout 2008. We are well positioned with a strong product offer and better than ever values across our business.

"We now have 70% of our stores in the modernised format and a strong pipeline of new space for 2008 and beyond.

Figures out yesterday from the British Retail Consortium (BRC) said like-for-like retail sales rose only 0.3% in December in the UK, which is the lowest figure since 2004. Kevin Hawkins BRC director general, also pointed to "a very challenging first half for 2008".