John Lewis sales back under pressure

Department store chain John Lewis today said sales dipped 0.8% last week in a sign of a return to tougher conditions on the high street after a festive trading boost.

The group posted £44.5 million in sales, down from £44.9 million a year ago, as John Lewis said shoppers were impacted by the economic gloom in a week that saw the UK declared officially in recession.

Weekly sales at the height of the January clearance period saw robust growth compared to last year across the 27 John Lewis stores and online operation - up 27% year-on-year in the key week to 3 January.

But Dan Knowles, a head of selling operations at John Lewis, said sales had since become "harder to come by" after a good start to last week.

Televisions and electricals continued to be popular, notching up a 12.8% increase in sales year-on-year, but the woes in the housing market continued to dampen demand for home products, sending sales in the division plunging by 13.1%.

However, there was better news from the Partnership's supermarket chain Waitrose, which reported a 2.1% hike in sales last week, helped by the launch of its £10 meal deal promotion.

The better performance within Waitrose helped lift overall sales for the Partnership by 1% to £121.1 million.

Kate Heseltine, retail analyst at Seymour Pierce, said she was "encouraged" by the figures, despite the department store sales dip confirming that conditions are still challenging.

"The minus 0.8% figure reported is still slightly ahead of our expectation and an encouraging sign that consumers are continuing to spend on the high street," she added.