What's in this report?
This ‘newsletter-style’ report provides you with key monthly updates as to what’s happening in the UK retail and leisure industry. It keeps you abreast of the latest:
- • Retail news & stories
- • Updates by category & channel
- • Latest economic indicators
- • Key retail dates throughout the month & more…
Succinct, punchy, need-to-knows for professionals in retail, leisure and retail-related industries.
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Podcast format
You can listen to selected highlights of this report in our weekly Retail Roundup podcast. Listen to retail news and updates on the move!
Example podcast episode:
Example insights
Economic Update
Bank rate rises but says inflation past peak
The Bank of England raised its base rate from 3.5% to 4% on 2 February, the highest in 14 years.
While the UK is set to enter a recession this year, the Bank of England expects it to be shorter and less severe than previously thought, as energy costs and other prices ease. Indeed, the Bank predicts inflation will ease to 8% in June before falling to 3% in Q1 2024
This comes as double-digit price rises are having an uneven impact on discretionary income across households, leaving the least and middle affluence households with around £40 less cash per month to spend on non-essential items compared to a year ago (Retail Economics Cost of Living Tracker).
House prices ease
The annual rate of house price growth eased to 1.9% in Jan, from 2.1% in Dec, the lowest level recorded over the last three years (Halifax).
The monthly fall in house prices was marginal, taking the average property price to £281,272. Following a series of larger monthly falls at the end of 2022 (-1.3% in December and -2.4% in November).
The average house price is now around £12,500 (-4.2%) less than its peak in August 2022 but remains £5,000 higher than in January 2022.
Food & Grocery
Price investment - Lidl GB plans to invest £4bn in UK food businesses in 2023, increasing its five-year £15bn investment commitment to £17bn. So far, it has invested £10bn since March 2020 and in 2022 almost £500m in exports from UK suppliers went to other Lidl markets.
Price hikes - Iceland was named the UK supermarket where prices increased the most by trolley.co.uk. The retailer reported a 10.1% increase in prices since January 2022.
Financial updates - Morrisons saw a 15% drop in full-year adjusted EBITDA to £828m for the 52 weeks ending 30 October 2022. This makes it the only major player apart from Waitrose to see a decrease in sales, with a 1.9% slip in overall sales in the 12 weeks to 22 January, totalling just under £3.1bn
Socially responsible retail - Asda is offering children a free warm breakfast through the February half-term holiday as part of an exclusive partnership with Quaker Oats. Families are now able to access both a free children’s breakfast and a main meal for just £1 in all Asda cafes.
Clothing & Footwear
Financial Updates - Superdry reported an interim adjusted pre-tax loss of £13.6m in the first half to 29 October 2022, an increase from the previous year's loss of £2.8m. Group revenue increased by 3.6% to £282.2m, while group sales rose 4.5% during the 9-week Christmas period. Retail revenue increased 24.9% over Christmas, while wholesale revenue declined 5.2% in the first half due to the impact of Covid-19 and shipment timing. The company lowered its full-year expectations to break even.
H&M saw net sales for the three months to 30 November 2022 rise 10% YoY to £4.9bn despite store closures in China and Russia. Net sales in the year to 30 November increased 12% YoY to £17.7bn.
Theo Paphitis Retail Group saw 5.5% sales growth in stores and a 9.7% fall in e-commerce sales in the six weeks to 24 December 2022. Store sales as a proportion of the total business increased from 62.2% to 65.8%.
Pandora saw sales increase 7% to £3.16bn in the year to 31 December 2022, with profits climbing 11.2% to £1.04bn during the same period.
Investment - Frasers Group increased its stake in N Brown to 17.88%, becoming the second largest single shareholder behind Lord David Alliance who bought the company in 1968.
Competition concerns - Farfetch's planned acquisition of a stake in Yoox Net-A-Porter (owned by Richemont) is being investigated by the CMA over concerns that it might reduce competition in the market. Farfetch and Dubai businessman Mohamed Alabbar bought 51% of Yoox in August, with Farfetch set to own 47.5% of the Yoox Net-A-Porter Group and Alabbar taking an additional 3.2% stake.
