Some of our biggest high street names have had a poor start to the year with Christmas sales not bringing as much cheer as hoped.
House of Fraser, the department store chain, which holds key retail sites in Exeter and Plymouth has warned that it may need to reduce the size of its stores to reduce its rents across its portfolio.
House of Fraser, due to reveal Christmas trading figures this week, announced closures in Leicester and Aylesbury, Buckinghamshire, last year.
And while the affect on the Devon branches is unknown – there are fears that stores may reduce in size.
Meanwhile, Debenhams, which has a flagship store in Princesshay in Exeter and a huge presence in Plymouth and Torquay has issued a profit warning after reporting disappointing Christmas trading.
It said like-for-like sales in the UK fell 2.6% for the 17 weeks to 30 December amid a “volatile and competitive” market.
And Exeter has avoided a blow after fast food chain Byron Burger has plans to close 15 of its branches across the UK.
Exeter is not on the list of branches facing closure as part of a project to cut costs.
The company will launch a company voluntary arrangement as part of a strategy to bring in new investment, but it will require the approval of creditors including landlords.
Will Wright, restructuring partner at KPMG and proposed ‘supervisor’ of the CVA, said: “This arrangement seeks to strike a balance which provides a fair compromise to landlords, while allowing the viable part of the business to move forward across a smaller, more profitable core estate. It’s important to stress that no restaurants will close on day one, and employees, suppliers and business rates will continue to be paid on time and in full.”
Elsewhere, suit hire company Moss Bros has become the latest retailer to issue a profit warning over the festive period following disappointing sales, saying it expected “challenging retail conditions to continue for the forseeable future”.
As a result the company revised its pre-tax profit forecasts to between £6.5m and £6.8m, below the amount predicted by City analysts.
Mothercare in Drakes Circus, Plymouth
It’s been a bad month for Mothercare also, which earlier this week reported a big fall in sales over the crucial Christmas trading period. Like-for-like sales fell 7.2% year-on-year, while online sales fell 6.9%.
Mothercare’s Plymouth store, on the bottom floor of Drake Circus mall, is set to relocate to a new retail park outside of the city centre.
But food stores have been doing well.
Lidl, which has just opened a giant distribution warehouse on the outskirts of Exeter, had record UK sales in December, with a rise of 16% on the same period in 2016.
And Sainsbury’s has also reported rising food sales, selling 1.1% more in the last three months, as higher grocery sales made up for a 1.4% fall in general merchandise and slower clothing sales.
Sainsbury’s, which owns Argos, said its fast track delivery grew strongly over the period, but there was a slide in Argos’ sales.
Source: Devon live