WHSmith warns of tough market

WHSmith's directors echoed the pessimism of their counterparts at Dixons when they said on Wednesday that they expect a difficult retail market this year.

The bookseller and general merchandiser reported a 2 per cent fall in UK like-for-like sales in the five weeks to January 11.

Group chief executive Richard Handover echoed comments by Dixons' boss John Clare. 'We think it's going to be tough,' said Handover.

However, he said he is pleased with a 2 per cent improvement to gross margin, achieved by resisting pressure to mark down goods.

Sales of fiction were poor over Christmas. However, DVDs showed massive growth of 117 per cent and WHSmith increased its market share by 3 per cent.

E-tail sales rose 43 per cent over the five-week period.