Including GAME warning on full year profits and Tesco to cut 1,200 head office jobs.
The Source rounds up some of the key retail stories of the week.
Video games retailer GAME has warned that its full year profits will be ‘substantially below’ previous expectations. The company said that, while consumer demand for the new Nintendo Switch console remains strong, the level of supply to the UK market has been lower than expected. Combined with the continued softness in the core Xbox and PlayStation markets, this has impacted sales. Meanwhile, the Spanish business continues to trade strongly and in line with expectations – it is on track to achieve record sales in the year. The group will announce its full year results for the 52 weeks ending July 29 in October.
Tesco is to cut 1,200 jobs at its head office – representing around 25% of the workforce at the offices in Welwyn Garden City and Hatfield. The retailer said that the changes were the ‘significant next step’ in its ongoing turnaround efforts. Retail Week reported that it understood the cuts will be made across most areas of Tesco’s centralised functions.
Google has been fined €2.4 billion by the European Commission for promoting its own shopping comparison service at the top of its search results. The fine is the largest ever handed down by the EU regulator, with it also ruling that Google should stop the practices within 90 days or face further penalties. Google said that it is considering an appeal.
Debenhams has warned that full year profits could be towards the lower end of market expectations. The department store chain said pre-tax profit could be hit if ‘current market volatility’ continues after an ‘unpredictable’ Easter period. Debenhams saw group like for like sales drop 0.9% during its third quarter.
John Lewis has reported that sales dipped 0.5% to £96.2 million for the week to June 24. Despite the overall decline, fashion saw a 1.5% uplift – with both men’s and women’s casualwear posting double digit growth – while the swimwear and nightwear category grew 26.5%. Electricals and home technology increased 9.8%.
The owner of Express Gifts – Findel – has seen its losses widen to £59.4 million in the 53 weeks to March 31. This is compared with £1.7 million the previous year. The loss was driven by ‘individually significant items’ of £82.2 million (up from £26.5 million in 2016). Group revenues actually increased 11.3% to £457 million, with product revenues up 15.6% on a like for like basis to £260 million at Express Gifts.
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