S & Spencer yesterday reported a rise in sales for the three months to Christmas but warned of a tough year ahead.
The retailer saw like-for-like sales rise by 0.8 per cent with record takings on food on 23 December.
Food sales overall were 0.4 per cent up on the previous year with general merchandise up 1.2 per cent.
However, rival Waitrose, part of the John Lewis group, saw its sales rise 16.1 per cent over the same period. And M&S chairman Sir Stuart Rose admitted the firm had been “bested by Waitrose”.
M&S shoppers bought more than 36m mince pies and a million bottles of champagne as well as 8m jumpers and cardigans.
The retailer also had its first ever £50m day in its 125-year history.
However, the seasonal sales boost missed the 1.2 per cent jump pencilled in by City analysts.
The retailer, which sees Marc Bolland arrive as its new chief executive later this year, is forecasting a difficult retail climate this year.
Rose said: “We had a good Christmas. We expect the trading conditions over the coming year to remain challenging as a result of continuing economic uncertainty.
“We believe, however, that customers will continue to seek out real value and quality for which we are justly famous.”
He added: “We know we have got some medicine coming. The consumer had a year last year to get used to the fact there was a difficult economic situation, but equally they had more pounds in their pocket.
“Now they’re in the position that we’ve already seen VAT [put] back. We have got the prospect – whichever Government gets in – of some fairly stringent measures.”