Tesco sales hit by slow summer, says researcher Kantor Worldpanel. Investors are braced for Tesco (TSCO) to report slowing sales growth this Wednesday despite a boost from the summer heatwave and England’s World Cup run. Despite the hype over the supermarket giant’s recent launch of two discount stores, total sales at its other 3,400 outlets grew just 1.9% over the summer months, according to researcher Kantar Worldpanel. That was just half the growth rate of the wider supermarket industry. Tesco is battling against a recovery in sales at Asda and a continuing land grab by the German discounters Aldi and Lidl. Analysts expect Tesco to say that like-for-like sales growth slowed slightly in its second quarter when it publishes results for the six months to the end of August.
Sir Martin Sorrell slams WPP (WPP) deal as ‘close to negligent’. Sir Martin Sorrell has savaged WPP’s strategy since his abrupt exit from the advertising giant in April. In an interview with The Sunday Times, Sorrell branded WPP’s decision to sell its stake in the digital marketing company Globant as “bordering on negligent” and claimed there was no one left to “look out for” the company he founded more than three decades ago.
Credit insurer Atradius cuts cover to suppliers for Debenhams. Stricken retailer Debenhams (DEB) faces a cash squeeze after a leading credit insurer pulled the plug on cover it provides to the department store chain’s suppliers. Atradius reduced cover to Debenhams suppliers this year, but is now understood to have cut it entirely. The move raises concern over the health of the 200-year-old chain before Christmas shopping gets under way.
Mike Ashley is struggling to agree terms with the landlords of House of Fraser’s prime stores — undermining a key plank of his turnaround strategy. Lowball offers from the billionaire retailer, who bought House of Fraser out of administration last month, have turned the talks into a “game of chicken”, said a property source. Ashley has still to agree new terms with landlords on more than 30 stores. On some of the 20 stores where terms have been agreed, the boss is said to have secured one-year leases with rent cuts of up to 70%. In other instances he is thought to be offering to pay business rates but no rent — capitalising on weak demand for large retail units.
Plumbing supplier Ferguson ‘still growing’. The plumbing and heating supplier Ferguson (FERG) is set to show continuing growth despite the US construction slowdown when it posts its annual results on Tuesday. The FTSE 100 company, previously called Wolseley, makes 80% of its sales in America. Mergers and acquisitions are “an area of potential interest” for Ferguson, analysts at Hargreaves Lansdown said.
Why Card Factory may get well soon. The most apt Christmas card Karen Hubbard, Card Factory (CARD) chief executive, could send to shareholders this year would read “Sorry for your loss”. Shares have shed about a third of their value, and at 198p they now trade well below the 2014 float price of 225p. Reporting a 9% decline in underlying earnings last Tuesday did little to lift investor spirits. However, a new dawn brings a new day. On Wednesday, activist investor Teleios Capital was forced to disclose that it had built up a 5.1% position in Card Factory — and recent history shows that when Teleios turns up, a big-money acquisition often follows.
