January 10, 2020 / 8:11 AM / 7 days ago

UPDATE 1-B&M's sales growth slows in key Christmas quarter

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LONDON, Jan 10 (Reuters) - Britain’s B&M, whose stores sell everything from furniture to electricals to food, said its sales growth slowed in the key Christmas quarter due to a tough market and a decision not to engage in early discounting activity.

The London-listed retailer said on Friday like-for-like sales in its core B&M UK business rose 0.3% in the 13 weeks to Dec. 28, its fiscal third quarter. That compares to first half growth of 3.7%.

Its shares fell 6% in early trading.

“Cumulatively, B&M UK has achieved +2.3% like-for-like sales growth during the financial year to date, albeit with a slower performance than anticipated during the run up to Christmas,” said Chief Executive Simon Arora.

He highlighted the backdrop “of a difficult UK retail environment with reduced shopper footfall and political uncertainty.”

A raft of trading updates this week have shown UK retailers struggled for sales growth in the run-up to Christmas.

For B&M, which has a full name of B&M European Value Retail, overall group revenue rose 9.3% on a constant currency basis over the quarter.

It said it had seen a positive start to January trading and looked forward to 2020 with confidence.

The group trades from 657 stores in the UK operating as B&M and 295 Heron Foods stores. It also has 96 stores in Germany, primarily operating as Jawoll and 100 Babou stores in France.

In November, B&M wrote down the value of the loss-making Jawoll unit and put it under review.

It said on Friday that review was ongoing.

Shares in B&M, up 28% over the last year prior to Friday’s update, closed Thursday at 397.2 pence, valuing the business at 3.98 billion pounds ($5.2 billion) - more that Marks & Spencer’s stock market value. ($1 = 0.7659 pounds) (Reporting by James Davey; editing by Kate Holton)

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