M&S blames weather as clothing sales fall over Christmas quarter

Tesco is festive winner reporting record Christmas sales

Shares in Tesco (LON:TSCO) have fallen deep into the red in London this morning, even as Britain's biggest supermarket revealed a rise in sales during the third quarter of its financial year and the crucial Christmas period.

The setback for food looked especially disappointing given that the grocery sector overall was emerging as a victor from the festive period - with upmarket rival Waitrose and supermarket giant Tesco both enjoying strong food revenues.

United Kingdom retailer Marks & Spencer has posted a 1.4% decline in like-for-like sales in its home market in its third quarter, with Food sales down 0.4% and Clothing & Home sales down 2.8%.

"Our trading momentum accelerated across the third quarter and into December, with the four weeks leading up to Christmas Day delivering record sales and volumes in the United Kingdom".

"Sales at established stores rose 1.1" in the 15 weeks to 6 January, in line with consensus.

However, general merchandise like-for-like sales fell 0.6 per cent.

Steve Rowe, chief executive, said: "M&S had a mixed quarter with better Christmas trading in both businesses going some way to offset a weak clothing market in October and ongoing under-performance in our food like-for-like sales".

"Whilst I am pleased to say these challenges have now been resolved, they took the shine off an otherwise outstanding performance for the period as a whole", Lewis said.

Supermarkets are battling rising costs linked to the Brexit-hit pound, falling consumer confidence and fierce competition in the sector as Lidl and Aldi continue their relentless march.

While inflationary pressures remained a problem for many United Kingdom food firms, Tesco said it had continued to work with its supplier partners to help mitigate the impact on its customers.

"Sales in clothing and home actually fell by the biggest margin, but in a market which is shrinking, that's more a reflection of wider economic trends", he said.

The M&S boss said that despite the sales dip, he believed the retailer was right to resist the Black Friday discounting frenzy as it focused on restoring its price positioning.

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