British retailer Marks & Spencer posted a third consecutive rise in underlying quarterly sales, though its rate of improvement slowed a little and it joined rivals in sounding cautious about the consumer outlook.
Chairman Stuart Rose also played down the prospect of a shareholder rebellion at its annual meeting next week over the £15 millionpay package awarded to new chief executive Marc Bolland, telling reporters today he had confidence all resolutions would be passed "adequately".
The retailer, which also has stores in Ireland, said sales at British stores open at least a year rose 3.6 per cent in the 13 weeks to July 3rd, its first quarter.
That was toward the top end of forecasts and boosted by a strong performance in clothing, though it was down from a 5.1 per cent rise in the previous quarter.
Britain's retailers are concerned that higher taxes, including a rise in VAT sales tax, and public spending cuts aimed at slashing record government borrowing - as announced in an emergency budget on June 22nd - will hit consumer spending in the months ahead.
"This (budget) will have an impact on trading not only for us but for the high street in total," said Mr Bolland, though he did not expect the British economy to lurch back into recession.
Last Thursday, Debenhams, Britain's second-biggest department store group, said trading had got tougher since the budget with consumers also distracted by the soccer World Cup.
M&S, which has more than 650 British stores and also has about 300 shops abroad, was hit hard in the recession, particularly in its upmarket food business.
It has fought back with lower-priced "Wise Buys" in food, new clothing ranges like "Indigo", and a revamped online offer.
Like-for-like general merchandise sales, which include clothing and homewares, were up 6 per cent in the quarter, boosted by strong sales of summer knitwear and holiday ranges.
Food sales were up 1.5 per cent on the same basis, stoked by 570 new product launches, including the "Grill" meat range.
That excluded a benefit from Easter, which would have added about 0.4 per cent and 1.4 per cent to the general merchandise and food figures respectively, M&S said, adding it won 50 basis points of market share in non-food and 10 basis points in food.
M&S said international sales rose 0.9 per cent, while sales at the M&S Direct internet arm leapt 49 per cent.
Reuters