Marks & Spencer, Debenhams and John Lewis reveal disappointing sales on grim day for high street retailers

John Lewis warns staff may not receive annual bonus for first time since 1953

The employee-owned department store chain, famed for its Christmas adverts, chalked up its worst festive-season sales growth in a decade (Reuters)

Marks & Spencer and Debenhams have reported a fall in sales during the Christmas period, while John Lewis has said staff may not get their annual bonus for the first time since 1953, marking another grim day for struggling UK retailers.

Like-for-like sales slumped 3.4 per cent at Debenhams in the six weeks to 5 January, while UK sales were down 3.6 per cent as people made fewer trips to the high street.

The embattled department store chain predicted profits for the year would still keep up with previous forecasts but that didn’t do much to support the share price which tumbled 12.8 per cent on Thursday.

At fellow high street stalwart M&S, comparable sales fell 2.4 per cent in clothing and home in the final quarter of the year while food sales were down 2.1 per cent as shoppers switched to cheaper alternatives including Asda, Lidl and Tesco.

John Lewis chalked up its worst performance since the financial crisis with like-for-like sales growing 1 per cent to £1.1bn.

The employee-owned department store chain warned that profits would be “substantially lower” this year and told its 83,000 staff that their annual bonus is under threat.

Post-war rationing was still in force the last time John Lewis staff did not get a share of the company’s profits in 1953.

On a so-called “Super Thursday” of retail results, Tesco bucked the downward trend with its best Christmas trading figures since 2009.

Like-for-like sales, which strip out the effect of opening and closing stores, rose 2.2 per cent in the six weeks to 5 January.

The UK’s largest supermarket chain outperformed rivals in all major categories: food, clothing and general merchandise.

As UK consumers traded down amid economic uncertainty, those at the top of the income spectrum bought more Rolls-Royces than ever before last year.

The British car manufacturer, owned by BMW, sold a record 4,107 vehicles, a rise of 5 per cent on its previous best set in 2014. Donald Trump’s tax cuts for higher earners in the US helped boost sales of bespoke limousines, Rolls-Royce has said.

Car parts and cycling retailer Halfords experienced different fortunes, warning profits would be £58m to £62m, some way off the close to £70m predicted by City analysts.

The chain Card Factory warned that underlying profits for the 2020 financial year are likely to be flat while bargain retailer B&M said it had endured a tough November but recovered in December to post a 1.2 per cent rise in comparable sales.

The retail sector as a whole recorded zero sales growth in December – the worst Christmas trading for a decade – according to the latest data from the British Retail Consortium and KPMG.

Not since the financial crisis of 2008 have UK high streets performed so poorly, as like-for-like sales fell 0.7 per cent from December 2017.

BRC chief executive Helen Dickinson warned of further risks on the horizon for struggling retailers.

“The worst December sales performance in 10 years means a challenging start to 2019 for retailers, with business rates set to rise once again this year, and the threat of a no-deal Brexit looming ever larger.”

The retail landscape is “changing dramatically” in the UK, while the trading environment remains tough, she said.