Marks & Spencer (M&S) noted a jump in sales by 8.9% during Q3 compared to pre-pandemic levels two years ago, whilst Tesco exceeded predicted sales for the Christmas period.
In the 13 weeks ending 28th December 2021, M&S food sales were 12.4% higher than in the same quarter of 2019, whilst average basket sizes also increased. M&S said it is “more confident” of meeting its recent upgraded profit forecasts of £500 million unless new restrictions or lockdowns are imposed by government.
“Driving improved performance”
M&S’s chief executive Steve Rowe said: “Trading over the Christmas period has been strong, demonstrating the continued improvements we’ve made to product and value.”
He added: “Food has maintained its momentum, outperforming the market over both 12 and 24 months. The market continues to be impacted by the headwinds and tailwinds that we reported in the first half, but I remain encouraged that our transformation plan is now driving improved performance.”
Tesco now expects retail operating profit slightly above the top-end of the previous £2.5 billion to £2.6 billion guidance range and bank operating profit to be between £160 million and £200 million. The retailer’s like-for-like sales rose 0.3% compared to the 2020 festive period, with an 8.8% increase in sales when compared to the same period in 2019.
Tesco’s online sales remained significantly ahead of pre-Covid levels, with sales between the 19 weeks ended 8th January up 58.7% when compared to sales of the same period in 2019. The retailer’s online delivery service recorded roughly 1.2 million orders per week over the same period this year, with Tesco recording the highest online share since the pandemic began.
“We continued to invest to protect availability”
Ken Murphy, chief executive at Tesco, said: “We are delighted that we were able to help our customers have a great Christmas. Despite growing cost pressures and supply chain challenges in the industry, we continued to invest to protect availability, doubled down on our commitment to deliver great value and offered our strongest ever festive range. This put us in a strong position to meet customers’ needs as, once again, Covid-19 led to a greater focus on celebrating at home. As a result, we outperformed the market, growing market share and strengthening our value position.”