Co-operative Xmas Comp Sales +6%, More Evidence Of OK Season
Tuesday January 6th, 2009 / 13h22
By Lilly Vitorovich
Of DOW JONES NEWSWIRES
LONDON -(Dow Jones)- The Co-operative Group, the U.K.'s largest mutual retailer, Tuesday reported strong Christmas sales, underpinned by demand for cheap groceries and electrical goods, in further evidence that the holiday season wasn't as bad as feared on the high street.
The group's rebranding and refurbishment of 700 stores last year also helped attract customers, and bodes well for the new year, Chief Executive Peter Marks said.
"We look forward to 2009 from a position of increasing strength," he said.
Sales from stores open at least one year, excluding fuel, rose an annual 6% for the three weeks to Jan. 3. Like-for-like sales rose 5.2% in the fourth quarter ended Jan. 3 - the 12th successive quarter of like-for-like growth.
Over the three-week Christmas and New Year period, sales growth was strongest in beers, wines, spirits, soft drinks, seasonal lines and across all areas of fresh food, the Co-op said.
The group's on-line electrical business, The Co-operative E-store, also did well over the holidays, with like-for-like sales for the two weeks before Christmas up 20%. In the week leading up to Christmas, sales were up 32%. Televisions, food processors and coffee makers were the top sellers, according to the Co-op.
CEO Marks said the results "represent a good trading performance from our food business in an increasingly competitive market place and a difficult economic climate."
"Leading into and throughout the seasonal trading period, we sharpened our prices and strengthened our customer offer providing even greater value locally, backed by our best ever national TV advertising and local marketing campaign," he said.
The Co-op also continued to support ethical trading, offering Fairtrade goods such as champagne truffles, Christmas puddings and mince pies. All its fresh turkeys were free range and British, while its own-branded Christmas cards and wrapping paper were accredited by the Forestry Stewardship Council.
"The unprecedented level of investment in store rebranding and refurbishment is paying back ahead of target, as customers like the new look and feel of our modernized stores," Marks said.
A total of 700 stores were rebranded and refurbished during 2008 at a cost of GBP200 million, which delivered average year-on-year sales growth of 13%, according to the Co-op. A further 700 stores will be rebranded and refitted this year.
The company expects to complete its acquisition of rival Somerfield in the first quarter of this year, CEO Marks said.
J Sainsbury PLC (SBRY.LN) will be the first-publicly listed U.K. supermarket chain to report Christmas trading on Thursday, followed by Tesco PLC (TSCO.LN) on Jan. 13 and William Morrison Supermarkets PLC (MRW.LN) on Jan. 22.
Company Web site: www.co-operative.coop
-By Lilly Vitorovich, Dow Jones Newswires; 44-0-207 842 9290; lilly.vitorovich@dowjones.com
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