We have started the Christmas period with sales statistics for UK retailing that can only be described as 'gloomy'. Sales and profits problems at Boots The Chemists and Marks & Spencer are however only part of the story, which has seen sales and profits rise at retailers like Greggs, Travis & Perkins/Wickes, Primark and T K Maxx. The UK branch of Mothercare has been kicked into touch by its owners who have absolutely no idea what to do with it, while Debenhams and the House of Fraser are still in the doldrums. B&M is to add 46 new stores in the next six months to its current total of 645 B&Ms and 270 Heron Foods/B&M Express branches. Primark is to open another 19 stores in 2020.
British Land, the £4.8bn landlord of shopping centres, retail parks and stores, reported that its assets had lost 10.7% in value (-£599m) in the half-year to September 2019, compared to an 11.1% fall in the previous half-year. The business's loss was -£440m this half year, compared to -£42m in the previous half year.
Our figures shown that in the ten months to early November 2019, 130,000 jobs have been lost in the retail industry. By the end of December this may rise to 150,000.
There are a couple of recent strategic trades that are just as ominous.
Carpetright. This large chain of almost 370 stores is being sold to hedge-fund Meditor for as little as £15.2m. Meditor is its largest shareholder and now owns much of its debt. The Company requires around £80m to pay off its debts (£50m) and fund the upgrade of the business. Carpetright is already part-way through its programme of closing 92 stores.
Bensons for Beds, Harveys, Relyon. Steinhoff is a German/South-African retail business that owns Bensons for Beds, Harveys and manufactuer Relyon. It has now sold its UK furniture division to private-equity fund Alteri to concentrate on its other businesses in Europe and South Africa. The company has been beset by scandal since possible accounting irregularities were alleged. Other subsidiaries include: PepCo, Poundland, Dealz (Ireland) and Conforama (France).