High street faces chilly week ahead as disappointing festive trading updates expected
High street retailers are expected to be further under the cosh by the end of the week, with a flurry of quarterly trading updates due in the coming days.
Troubled department store Marks and Spencer is one of several set to reveal yet another fall in sales over the festive period, according to analysts at the company’s broker Shore Capital Markets.
Analysts are expecting Marks and Spencer’s like-for-like sales to be down as much as three per cent across both its clothing and food businesses over the final three months of the year, as the company presses on with a turnaround effort outlined by chief executive Steve Rowe in its November interim results.
But despite the drop, a late sales rush before Christmas, reported last week by John Lewis and Next, is expected to help keep M&S away from the need to issue a profit warning. Analysts still estimate Marks and Spencer’s pre-tax profits to be around £528m on the 10 December announcement.
Department store Debenhams is also expected to struggle as it releases its results on the same day. Russ Mould, analyst at AJ Bell, said expectations “remain low for the business to deliver some good news”.
“Debenhams hasn’t updated on trading since 25 October and we know from many of its competitors that November was a terrible month for retailers and December is also likely to have been a struggle,” he said.
“Debenhams is now worth a mere £57m which is astonishing for a business that generated more than £2 billion of sales in its past financial year.”