Below are the key morning headlines from today’s papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
Retailers suffer worst festive trading in a decade. Retailers have suffered their worst December since the recession after cautious shoppers delayed spending until the last moment and abandoned the high street to hunt for bargains online. Last month’s trading was as tough as in 2008 when the high street was battered by the credit crunch, according to new sales figures compiled by the British Retail Consortium and KPMG. The weak sales data comes as official figures have shown the savings ratio for UK households has reached minus 0.2%, suggesting that families are outspending their earnings, and despite record low unemployment and improving wage growth.
Standard Life in Virgin deal. , the group that owns Virgin Money, Yorkshire Bank and Clydesdale Bank, has agreed a £40 million tie-up with , to try to increase its presence in the savings market and push new investment products to its six million customers. As part of the deal, Standard Life has bought a 50% stake in Virgin Money’s investment business, which will expand its retail asset management services. CYBG acquired Virgin Money in October in a £1.7 billion deal that doubled its customer base and made it Britain’s sixth biggest bank.
Shoppers pull the plug on Sainsbury’s Christmas sales. A late surge in spending at Christmas does not appear to have helped , with sales falling by more than expected as shoppers “downtraded” to less expensive items. Britain’s second largest grocer revealed that its like-for-like sales, excluding fuel, were down by 1.1% in the 15 weeks to January 5. The City had expected a 0.3% drop. The subdued performance was in part due to its clothing and general merchandise divisions, which include Argos, where sales dropped by 0.2% and 2.3% respectively. Sainsbury’s said that Argos in particular was hit by a dramatic fall in spending on toys as the wider market fell by double digits during the period.
Greggs’ vegan sausage roll proves biggest hit in six years. has sold “hundreds of thousands” of its new £1 vegan sausage rolls in the first week of January, making it the fastest selling new line in six years. The bakery chain said the new savoury snack, which launched earlier this month in 900 of its stores with the biggest vegetarian food sales, sold out instantly. “It has taken us by surprise,” said Roger Whiteside, chief executive. “We didn’t know if it would sell or not but it has been flying off the shelves.” Mr Whiteside added that sales of its normal sausage rolls were boosted by the new product, as customers who failed to lay their hands on the vegan roll settled for the original as an alternative.
Majestic Wine refuses to rule out store closures. The boss of has refused to rule out store closures as Christmas revenue growth doubled, driven by surging online sales. Comparable revenue for the 10 weeks to the end of December grew by 6.8% as chief executive Rowan Gormley insisted Majestic had “what it takes to be one of the winners” amid a “revolution in retail”. Like-for-like sales from online arm Naked Wines performed best, rising 15.9% on an underlying basis. “Most people’s perception of the Majestic Group is that it is a big offline retailer with a little start-up business attached to it,” said Mr Gormley. But online gross profit overtook that from its retail stores in the first half of 2018, he added.
Sex claims fail to hit sales at Ted Baker. Sales at rose over Christmas despite allegations of “forced” hugging and sexual harassment by its founder. The chain, whose colourful designs can be found on everything from clothing to luggage and eyewear, said its retail sales were up 12.2% in the five weeks to January 5, compared with the same period last year. The uplift was helped by an 18.7% rise in online sales. There was concern that allegations involving Ray Kelvin, its founder and chief executive, could have turned shoppers against the brand. The chain’s performance triggered a relief rally in the City. Its shares, which had been hit by the controversy, closed up 504p, or 31.2%, at £21.20.
Mothercare has a difficult rebirth. There were grim tidings for with its UK sales plummeting both online and in its stores as it struggles to turn round the business. The maternity retailer said its British like-for-like sales had fallen 11.4% in the quarter to January 5 while its online sales fell by an even higher 16.3% as fewer expectant mothers and families shopped at the chain. Sales in its international business, which accounts for two thirds of Mothercare’s revenue and all of its profit, were down 1.1%, but this was an improvement on the first half of its financial year when they fell 2%.
North Sea oil explorer surrenders to Viking raider. A London-listed North Sea oil explorer has capitulated in a bitter takeover battle after its Norwegian raider won over the majority of its shareholders with an increased £640 million offer. recommended its shareholders accept the 160p-a-share offer from DNO, despite insisting that it was unfairly low, after the Oslo-listed company either bought or secured acceptances for enough shares to wrest control of the company. Although Faroe had opposed DNO’s takeover, the pain of defeat should be eased by a £53 million pay day for its employees. This includes about £12.5 million to Graham Stewart, the chief executive, for his shares and share options, and more than £13.5 million split between seven other directors.
MPs slam ‘cynical’ Provident Financial Christmas ad which enticed borrowers to take out loans at more than 500%. Doorstep lender has been rapped for festive adverts aimed at vulnerable borrowers to take a loan at more than 500% interest. The Provvy, run by Malcolm Le May , posted ads showing a child wearing a Christmas hat and people hugging, and encouraged people to take loans with interest of 535.3%. The Advertising Standards Agency ruled it was irresponsible and should not be used again. Rachel Reeves, chairman of the Business Select Committee, has called for a probe. The firm said: ‘Provident provided assurances that such content will not be used in any further marketing materials.
Investors have lapped up a trading update from Vimto-maker , which said sales jumped 6.9% to £142million last year. The UK branch of the business did particularly well, as sales shot up 12.6% to £114.6million. The UK soft drinks market grew 7.4% in 2018. As well as Vimto, which was 110 years old in 2018, Nichols also owns Feel Good drinks, the Levi Roots brand, Sunkist and a range of frozen slushy products.
Broadcaster ITV was racing ahead yesterday as City analysts predicted it could soon ink a new deal with Sky, giving it a £120million boost. Ian Whittaker at broker Liberum said a deal between Scottish broadcaster STV and Sky, announced this week, could point to a bigger agreement in the pipeline for ITV. currently has a deal with to broadcast its programmes on the Sky player, but this is due to expire imminently. This week’s STV deal, Whittaker argues, shows Sky is willing to renew deals on relatively uncontentious terms, and quickly. A new partnership between ITV and satellite giant Sky could rake in an extra £120million for ITV, Liberum calculated, based on higher prices agreed in recent similar deals.
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