Warm weather and World Cup boosts UK retail sector
The UK retail sector has been given a confidence-inspiring boost by a rebound in sales in May courtesy of the improved weather conditions and in-store sales, according to a survey by the British Retail Consortium (BRC).
Like-for-like sales for existing stores rose by 0.8 per cent compared to the same month in 2009 according to the report. However, the improvement was aided by weak sales figures a year prior.
Despite this, the increase in sales will buoy investors as the biggest growth in retail sale since December comes after a fall in sales during April – mainly due to Easter falling earlier in the year than in 2009.
Along with an increase in sales, shop price inflation dropped back to 1.8 per cent in May, down from two per cent in April. Analysts have said the upcoming World Cup has had a strong impression on retail activity and sales strategies with electrical retailers competing for customers who are in the market for state-of-the-art televisions to watch the football tournament on.
According to the BRC, the warmer weather along with discounts and promotions has encourage spending on clothing, footwear and outdoor DIY.
Two retailers who released financial reports today supported the survey with both high-street sports retailer JD Sports (LON:JD) and online fashion-based firm ASOS (LON:ASC) announcing growths in sales.
Like-for-like sales for JD Sports grew in the UK and Ireland by 4.1 per cent in the eight weeks to 5 June – the sports fascias business presented a quarterly sales increase of 5.1 per cent driven by consumers purchasing International replica football kits and equipment in time for the World Cup kick-off on Friday.
ASOS released financial results for the year ended 31 March with an increase in international sales of 95 per cent headlining the report. Over the course of the year the company‘s international department made £63m in total and group revenue grew 35 per cent to £223m.
JD Sports share price improved by as much as two per cent today while ASOS grew 7.5 per cent.
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