Woolworths hit by poor Christmas trading
The situation at troubled retailer Woolworths worsened over the Christmas trading period as it reported a 4.6% drop in like-for-like sales during the key six weeks to 13th January. The store had warned in December that its UK investment in generating good profits would fail if its like-for-like sales did not improve, and a poor performance in CDs, DVDs and seasonal confectionery sales did the most damage. Many analysts pointed to the massive UK investment made by Tesco in greatly improving its seasonal performance and observed that this had hit Woolworths hard, with the smaller retailer unable to match the UK’s biggest store group on stock and prices. The latest figures follow a previously reported drop in sales of 6.5% for the 18 weeks to the beginning of December and point to a retailer in difficulties in the modern shopping arena. Chief executive Trevor Bish-Jones said: “Woolworths retail found some of its traditional markets more difficult this time, leading to disappointing like-for-like sales over the Christmas weeks. “CD, DVD and the seasonal confectionery product categories were hit by marked price deflation and did not return on our UK investment in them,” he continued. “Despite these problems, stock levels have been well controlled and we continue to improve gross margins.” In a separate announcement the company said it was buying book wholesaler Bertram Group for £29m in an attempt to bolster its entertainment wholesale business area.