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Marks & Spencer leads FTSE fallers despite Christmas sales rise
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Posted by: forwardone
• Predictions of a tough 2010 hits Marks & Spencer's shares
• Domino's Pizza 'delighted' by 15.6% rise in sales
• Majestic Wine sees six-bottle mininum purchase pay off
Marks & Spencer may be proud to have sold 36m mince pies to UK shoppers over the festive period, but its shares have fallen sharply this morning as the City chews over today's Christmas trading data from M&S, Domino's Pizza and Majestic Wine.
M&S's shares are down around 4.5% at 387p, despite reporting like-for-like sales growth of 0.8% for the last three months. Sir Stuart Rose's caution over 2010 prospects (he told BBC radio listeners to expect some "tough medicine" on the economic front) appears to have encouraged traders to sell its shares.
But Richard Hunter, head of UK Equities at Hargreaves Lansdown Stockbrokers, believes M&S's statement includes reasons to be optimistic:
Quarterly sales have improved for the first time in over two years, whilst the online division posted sales which rose impressively by 32%. In addition, the ongoing concentration on cost and stock control, along with the uncertainties removed by the appointment of a successor to the incumbent CEO, have combined to underpin the shares. However, the abolition of VAT relief along with almost inevitable pressure on consumer budgets later in the year will continue to weigh. The company itself was at pains to point out that the coming year is likely to remain challenging in the wake of this uncertainty.
The recession has already proved profitable for Domino's Pizza, and the fast-food chain today reported another set of good results. Domino's said it was "delighted" to post a 15.6% jump in sales for the 13 weeks to 27 December 2009.
Guardian.co.uk