Retail giants Marks & Spencer and Tesco have sounded the alarm over Britain’s ‘uncertain’ economic outlook and tax hikes even as they revealed strong Christmas trading. M&S reported £4.06billion in sales for the three months to 28 December, which was up 5.6 per cent on a year earlier.
But its shares fell sharply as worries over growth, inflation and interest rates threaten to dampen future prospects. And Tesco said there was ‘no doubt’ of increased pressure on costs – but insisted it would do its best to not increase prices. Both retailers have been clobbered by the Chancellor’s raid on National Insurance contributions, which will cost M&S £60million a year and add £250million to Tesco’s tax bill.
The pair were among a series of firms delivering a mixed series of updates on Christmas trading yesterday. Markets, already in a febrile mood amid a bond market sell-off, were unimpressed, prompting shares to fall across the beleaguered sector. Brand deal: M&S, led by boss Stuart Machin (pictured with Sienna Miller) reported £4.06bn in sales for the three months to 28 December.
Retailers are fearful that Rachel Reeves’s tax grab will damage the sector and that seemed to tarnish even the sparkling figures of M&S and Tesco. Marks’ sales were driven by food halls, with 1.2 fresh turkeys sold every second in the run-up to Christmas and 600,000 packs of pigs in blankets gobbled up.
