Menswear retailer Moss Bros was the week’s biggest riser as a bad-tempered battle for control raged. Members of the founding families, the board and associates of potential buyer Baugur all laid into each other, which can hardly be helping store performance.
As Retail Week went to press, there was talk that family shareholders might call an EGM in an attempt to oust the management, including chief executive Philip Mountford.
Marks & Spencer ramped up its international operations by launching a joint venture in Greece and the Balkans with local partner Marinopoulos, which previously ran stores as a franchisee. M&S intends to generate between 15 and 20 per cent of group sales internationally within five years.
Credit Suisse analyst Tony Shiret caused a stir with a note raising the prospect of an M&S takeover of Next. He said: “Were such a scenario to happen, we would anticipate M&S running Next more profitably than currently. Partly, this would reflect buying gains from scale, but also a more targeted trading strategy with less emphasis on competing with each other and more focus on other operators.”
However, Pali Interna-tional’s Nick Bubb was sceptical. He said: “The alternative scenario we would focus on is that Next might well go private, given the very low rating.”
Wickes, the DIY chain owned by Travis Perkins, posted a 0.9 per cent like-for-like sales rise in the first eight weeks of its new financial year, following a 5.5 per cent rise last year. Investec was relieved to hear some positive noises about the outlook for the repair, maintenance and enhancement market, but warned: “Life will continue to be tough for all home-related big-ticket retailers.”
Sports Direct, which is expected to issue an interim management statement next week, was a big faller. However, the retailer, controlled by controversial tycoon Mike Ashley, has risen strongly over the past three months as it has undergone a partial rehabilitation in the City.
Value homewares group Dunelm is well positioned to ride out a tougher second half, said Citi after last week’s interims. “Dunelm’s low average transaction value and the relatively maintenance nature of its merchandise should prove less discretionary than many retail categories,” the broker said.
Next week will bring a key healthcheck for the sector. Updates and results are expected from French Connection, Home Retail and Morrisons, and British Retail Consortium sales data will be issued on Tuesday.