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Market Commentary

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​Weekly Retail & Leisure News - 30​​​​​​​​​​​​​​​​​ May, 2016​​​​​​​​​​​​​​​​​​

Positive results for out of town retailers and disposable income at all-time high

It has been a positive first quarter for out of town retailers, with many reporting positive results in the DIY sector. Topps Tiles reported a LFLs increase of 4.7% in Q1 to April 2. The DIY retailer also reported a 13.2% jump in half-year pre-tax profit. B&M reported a 19.5% rise in total sales in the year to March 26, while LFLs were up 0.3% for the year. B&M opened 79 new stores over the year, which helped boost total sales by 23.6%. B&Q owner Kingfisher reported a 3.6% rise in LFLs for Q1 to April 30, with 6.2% uplift in LFLs for its UK and Ireland division. Kingfisher’s sales were boosted by the closure of 10 B&Q stores over the period, and the performance of Screwfix, which saw a 16.2% spike in LFLs.

Pets at Home and Dixons Carphone also reported positive results. “The pet market has proved over time to be more resilient than general retail”, says Pets at Home chief executive Ian Kellett, as LFLs grew 2.1% for the year to March 31. Statutory pre-tax profits rose 3.7% and total sales were up 6.7% for the year. Dixons Carphone reports a LFL increase of 4% in UK and Ireland and 6% increase across the full year. The electrical and telecommunications retailer said full year profits will come in the upper end of previous guidance between £445m and £450m.

In other news, spending power for UK families hit the highest levels on record in April. For the first time since 2008 when the tracker began, disposable income hit £200 per week, bringing spending power up 6.3% YoY. Consumer price inflation dropped to 0.3% and essential item inflation fell 0.2% during April, according to Asda Income Tracker. The cost of transport dropped 1.3% YoY while vehicle fuels jumped 7.5%. However, leisure activities such as cinema or eating out became more costly as prices increased 3.8% in April.​

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