Retail round up – The Wednesday papers
Sir Stuart Rose says M&S AGM furore is’rerun’of last year,Sir Philip Green warns that retailers will find the final quarter tricky,Tesco puts security tags on cheese during recession,Crisis over JJB chief Sir David Jones’s loan from rival grows,Jobs under threat as Coffee Republic goes bust,Ikea to axe more staff as demand falls,Factory output fall dashes recovery hopes,Ailing owner of Threshers stores loses sourcing chief….
The Daily Telegraph
Sir Stuart Rose, the Marks & Spencer boss, has dismissed the furore over his joint role as chief executive and chairman of M&S as “just a rerun” of last year.Sir Stuart faces a protest vote by shareholders at Wednesday’s annual shareholder meeting over his controversial dual role. The Local Authority Pension Fund Forum (LAPFF) has filed a resolution seeking the appointment of an independent chair by July 2010, a year earlier than planned.The motion is expected to get significant shareholder backing.However Sir Stuart said that shareholders’ arguments were the same at last year’s meeting, when M&S’s investors protested about his joint role.”There is not one iota of new news. The issue has been discussed, analysed, thought through, articulated and presented. Let’s see what turns out,” he said.Full article.
Sir Philip Green, the Topshop and Bhs owner,has cautioned that trading in the final three months of the year could be tricky given the likely cost increases that retailers will have to impose on shoppers.Most fashion retailers source goods from abroad and have been hit by the weak pound. The result is that they will have to pass on cost increases to customers through higher prices.Sir Philip also said that the re-imposition of VAT to 17.5pc at the end of the year could affect trade.”The big unknown is the back quarter.We’ve got currency,VAT coming back and other things coming through,”he said.Full article.
Tesco is to put security tags on cheese after an increase in shoplifting during the recession.The metal strips, usually put on alcohol, razor blades and CDs, has been added to everyday items such as Cathedral City cheddar cheese and steak.If the strips are not deactivated at the checkout tills then an alarm is set off.The store in Brockworth, Gloucester, has acted because of a spike in thefts following the economic downturn.Full article.
The Times
The crisis engulfing Sir David Jones,the chairman of JJB Sports,deepened last night when an attempt by the company to defend his £1.5 million loan from the founder of its biggest rival backfired spectacularly.JJB issued a Stock Exchange statement yesterday morning claiming that a £1.5 million loan taken by Sir David from Mike Ashley, the founder and majority shareholder of Sports Direct, JJB’s main rival, did not amount to a conflict of interest. It said: “The board is clear that the arrangement,that was initiated before Sir David joined the company as a non-executive director, has not given and does not give rise to any conflict of interest.” However, this version of events was flatly denied by Mr Ashley, whose legal advisers, Mishcon de Reya, were last night preparing a response to JJB.Full article.
Coffee Republic, the British coffee shop chain, has gone into administration after weeks of speculation about its future.Administrators KPMG said there would be “inevitable job losses” at the coffee company, which was founded by brother and sister team Bobby and Sahar Hashemi, near Bond Street, in central London in 1995.Although the Coffee Republic Plc holding company has not gone bust, its three subsidiaries, Coffee Republic (UK), Coffee Republic Franchising Ltd and Goodbean Ltd have all been placed in administration.KPMG hopes to sell on some of the company’s profitable franchises and outlets, although Mr Hashemi, who quit the company in 2006, is understood to have ruled out a return to his old company.Full article.
Ikea,the cut-price Swedish furniture retailer, is set to make more job cuts on top of 5,000 redundancies announced last month.Ingvar Kamprad, the founder of the furniture maker whose blue and yellow stores tarea spread around the globe,told a Swedish newspaper that it needed to reduce its staff even more.“We need to reduce our personnel further especially within manufacturing and logistics,” the billionaire, now a tax exile in Switzerland, told Swedish business daily, Dagens Industri.Full article.
Hopes that the recession had ended in the second quarter were all but dashed yesterday when it emerged that manufacturing had suffered a surprise slump, prompting economists to say that the economy had shrunk for a fifth consecutive quarter between April and June.Factory output tumbled by 0.5 per cent in May, hitting its lowest level since 1992 and confounding City expectations of a 0.2 per cent rise.The disappointing figures led the influential National Institute of Economic and Social Research (NIESR) to estimate that GDP across the economy as a whole had tumbled by another 0.4 per cent in the second quarter.If confirmed by official figures due on July 24, that would shatter rising hopes that the worst recession since the Second World War could have ended already, but it would still mark a big improvement on the 2.4 per cent fall officially reported for the first quarter.Full article.
The Independent
The owner of Threshers, the ailing off-licence chain, is losing its global sourcing chief at a time when it is suffering its “toughest ever trading” and a stock crisis caused by a reduction in credit insurance.First Quench Group,the private equity-backed company behind the 1,400 off-licence stores of Threshers, Wine Rack and The Local,has also appointed the retail consultancy Javelin to help its turnaround.The departure of Jonathan Butt, head of global sourcing, comes as First Quench Group is being hit by disrupted deliveries to Threshers stores, resulting from credit insurers scaling back cover for suppliers.Mr Butt, who has been at the company for 11 years, will depart later this month. He plans to set up his own agency and sourcing business, although he may do some consultancy work for the company.Full article.
