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Coronavirus – Retail & FMCG Updates From The UK

By Steve Wynne-Jones
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As part of our efforts to keep you, the ESM reader, notified on the latest coronavirus-related developments in the retail and consumer goods sectors, here are the latest news updates from the UK. Click the link in each snippet to view the full story. To return to the map, click here.

Greggs, the British food-to-go retailer known for its sausage rolls, bakes and sandwiches, said sales at its company-managed stores stood at 72% of the 2019 level in the most recent week as trading recovers from the COVID-19 lockdown.

Household products maker Reckitt Benckiser has reported better-than-expected quarterly results, as cautious customers stocked up on Lysol and Dettol disinfectants during the coronavirus pandemic.

A.G. Barr plc, best known for Scottish fizzy drink Irn-Bru, said that it expects revenue to fall by up to 15% this year, while reporting a recovery in its hospitality and 'on the go' segments as coronavirus curbs eased in recent weeks.

Online wine seller Naked Wines saw its sales surge 67% in June compared with last year as orders continued to rise even after the easing of the coronavirus-triggered lockdown in Britain.

British soft drinks maker Britvic has posted lower third-quarter revenue, as fewer people drank its beverages in public places due to the coronavirus-induced lockdowns.

Associated British Foods has said that it does not plan to take advantage of a British government scheme to pay employers for bringing back staff from furlough for its Primark outlets, eschewing a bonus of about £30 million.

Packaging firm DS Smith has reported a 5% rise in annual profit, bolstered by growing demand from e-commerce and consumer goods customers, but the company said it was too early to resume dividends in the short-term due to the pandemic.

Prices in shops in Britain fell again in June as retailers tried to lure shoppers out of their coronavirus caution but the size of the drop was smaller than in May, an industry survey has revealed.

Tesco said underlying UK sales rose 8.7% year-on-year in its first quarter to May 30, boosted by the country being on coronavirus lockdown for the majority of that period, though costs also rose.

Online wine subscription company Naked Wines saw its revenue soar 81% during the first two months of fiscal year 2021, with people ordering more wine for delivery during the coronavirus-led lockdown.

Premier Foods expects revenue and trading profit to exceed current estimates this year, encouraged by a 20% sales jump in the first-quarter due to stockpiling during coronavirus lockdowns across the UK.

Pepco Group, the owner of British discount retailer Poundland, reported a 16.3% fall in first-half profit to €89 million, hurt by the dent to sales from COVID-19.

British households remain downbeat about their financial prospects due to the damage caused by COVID-19, but are less pessimistic than in May and April when sentiment sank to its lowest in more than eight years, a survey by IHS Markit has revealed.

British retail sales rebounded much more strongly than expected last month as the country gradually relaxed its coronavirus lockdown, but public borrowing hit a record high and debt passed 100% of economic output.

For Britons hankering for a Greggs sausage roll, the wait is nearly over after the firm confirmed plans to reopen 800 shops from Thursday.

British business supplies distributor Bunzl forecast a 6% rise in revenue for the first half of the year as customers stockpiled its face masks, gloves and sanitisers during the coronavirus crisis.

The number of shoppers visiting Britain's high streets, retail parks and shopping centres in May was 81.6% lower that the same month a year ago as most non-food stores remained closed due to the coronavirus lockdown, the British Retail Consortium (BRC) said.

Discount retailer B&M reported a 3.2% increase in full year profit and said it was better positioned and more resilient than most to deal with the COVID-19 world.

British retailers reported a sharp fall in annual sales last month, but less of a decline than in April, after some COVID-19 restrictions eased and more shoppers went online, industry data has revealed.

British American Tobacco cut its annual adjusted profit and revenue forecasts, citing the impact of prolonged lockdowns in South Africa and Mexico and a bigger sales hit in countries including Bangladesh and Vietnam.

Consumer confidence in the UK declined to one of its lowest levels (-10) on record in May, according to the latest IGD Shopper Confidence Index.

Morrisons will make immediate payments to its smaller suppliers for a further three months to help them through the coronavirus crisis.

Morrisons’ new telesales shopping service, aimed at elderly and vulnerable shoppers that are self-isolating, has reached the 100,000 order mark.

British consumer confidence in late May fell to its lowest level since the global financial crisis over a decade ago as people worried about a rise in unemployment and falling house prices caused by the coronavirus crisis, a new survey has shown.

Primark plans to reopen all 153 of its stores in England on June 15 as coronavirus restrictions are eased, encouraged by European stores that have already resumed trading.

Drinks firm Britvic has posted a 1.4% increase in revenue at constant currency rates in the first half of its financial year, to £698.8 million (€784.3 million), however the business said that the coronavirus has impacted its out-of-home operations.

Growth rates have remained high across the entire UK grocery spectrum during the coronavirus epidemic, according to the latest Kantar data, however some of these gains have been offset by declines in 'on-the-go' purchases.

Asda has introduced a colourful pizza resembling a rainbow as a mark of support for NHS and care workers amid the coronavirus pandemic.

A surge in demand for online grocery services is likely to continue beyond the COVID-19 pandemic, a new UK study has found.

Marks & Spencer said it would accelerate its latest turnaround programme as it deals with the fallout from the coronavirus crisis and a 21% fall in annual profit.

Asda, the British supermarket arm of the world's biggest retailer Walmart, said its first-quarter comparable sales rose 3.5%, boosted by consumers stocking-up on food in response to the coronavirus crisis.

Tobacco group Imperial Brands Plc has said it plans to cut its dividend by a third as it seeks to save cash and pay down debt during the COVID-19 pandemic, and expects a bigger hit from the crisis in the second half of the year.

World's No.2 cigarette company British American Tobacco said it was ready to test its potential COVID-19 vaccine using proteins from tobacco leaves on humans, after it generated a positive immune response in pre-clinical trials.

British retail spending plunged by nearly a fifth in April as the government's coronavirus lockdown hammered the sector, however food sales were up, new studies have found.

Morrisons has said that trading during the first few weeks of its first quarter was 'highly volatile', with the grocer seeing a 5.7% increase in like-for-like sales for the quarter.

Asda has launched a food box containing a selection of essential grocery items and cupboard favourites.

Nomad Foods has posted a 10.5% year-on-year growth in revenue to €683 million in the first quarter ended 31 March driven by an ‘unprecedented’ demand for frozen food in wake of the COVID-19 pandemic.

British consumer confidence edged up in late April but remained close to its lowest levels on record as the country remained in coronavirus lockdown and on track for a deep recession, a GfK survey has revealed.

Asda’s president and CEO, Roger Burnley, has pledged the retailer’s support for over 3,500 care homes across the UK.

Chocolatier Hotel Chocolat has increased its banking facilities to help get it through the coronavirus crisis.

British food ingredients maker Tate & Lyle said demand for its sugars and syrups used by restaurants, cinemas and other public facilities fell in April as thousands of businesses remained closed by coronavirus lockdowns.

Reckitt Benckiser Plc is forecasting better than previously anticipated results for 2020 after reporting record quarterly sales growth as customers stocked up on its home care products amidst coronavirus lockdowns.

British American Tobacco said that it plans to maintain its guidance of high single figure earnings per share growth for 2020 while expecting some impact on volume and revenue growth in the second quarter due to the coronavirus.

UK retailers The Co-operative and Ocado have seen their sales rise by a fifth (+20.0% and +19.4%) respectively, according to the latest market share data from Kantar, due to changed shopper habits as a result of the coronavirus epidemic.

Britain's Co-operative Group has said that additional costs associated with the coronavirus crisis could be up to £275 million (€315 billon).

Campari UK has announced that it has created a relief fund for front-line workers in the hospitality industry in the country and donated £100,000 to fight the COVID-19 pandemic.

The British retail industry's lobby group and its main trade union issued new guidance to retailers in preparation for an anticipated easing by the government of the country's coronavirus lockdown and the re-opening of more stores.

Consumer goods giant Unilever has pulled its full-year forecast, saying it could not 'reliably assess the impact' of the coronavirus pandemic on its business, but said it would pay its quarterly interim dividend as planned.

Shoppers in the UK resorted to a second wave of stockpiling in the week ended 19 April after the government extended the lockdown, according to latest data from Edge by Ascential.

Britain's inflation rate dropped in March when oil prices tumbled and the coronavirus crisis escalated, official data showed on Wednesday, with a fall in clothing and footwear prices signalling how cautious shoppers were turning.

Morrisons has launched food boxes for Ramadan containing traditional items and staples including dates and chicken breast fillets, to satisfy shopper needs during the coronavirus crisis.

Primark owner Associated British Foods said it would not pay an interim dividend to save cash and could not provide full year 2019-20 earnings guidance for the fashion retailer because of uncertainty caused by the coronavirus crisis.

Asda has rolled out the ‘Scan & Go Mobile' service in all 581 stores to encourage contactless shopping in wake of the coronavirus pandemic.

Premier Foods has said that it expects annual trading profit to be at the top end of market expectations, as the coronavirus pandemic fuelled a short-term peak in volumes in March.

Discount supermarket chain Aldi UK is to sell groceries online for the first time to help vulnerable people and those self-isolating during the coronavirus crisis.

PZ Cussons is seeing "exceptionally high" demand for its Carex hand wash, sanitiser gels and Imperial Leather soap due to the coronavirus pandemic, the company has said, while flagging a slowdown in its beauty business.

Retail sales in the UK decreased by 4.3% in the five weeks to 4 April, compared to a drop of 1.8% in the same period last year, according to the latest data from the BRC–KPMG Retail Sales Monitor, however sales of food and essential items saw an 'unprecedented surge'.

While the COVID-19 outbreak saw an initial surge in purchasing across several key grocery categories, consumer purchasing is starting to stabilise in line with prior-year trends, according to a new study by IRI.

The temporary closure of the Waitrose Cookery Schools in the UK has inspired its chefs to adopt a new approach to teaching people how to cook.

British baker Greggs, whose shops have been shuttered by the coronavirus emergency, has secured credit from a government support scheme to meet its liquidity needs for a prolonged closure period, the company has said.

Diageo plc, the world's largest spirits maker, has abandoned its annual forecast for sales and profit growth, and suspended its £4.5 billion (€5.14 billion) share buyback programme in response to the coronavirus pandemic.

Online wine seller Naked Wine said that demand has risen during the coronavirus lockdown, and it now expects to top its 2020 sales forecast.

Tesco's decision to launch a pop-up store at the NHS Nightingale Hospital in Birmingham is a "fresh and proactive" approach to support workers on the front line, a leading retail analyst has said.

Britain's big supermarkets fear they won't be able to supply the country's 60 million people without longer opening hours or a relaxation of social distancing rules introduced to curb the spread of the coronavirus.

Retailer WH Smith has secured new lending facilities of £120 million (€136.3 million) to get it through the coronavirus crisis, which are conditional on raising new equity.

British consumer confidence has recorded its biggest fall in more than 45 years, a survey has shown, as a widening shutdown of the economy to slow the spread of the coronavirus hammered households' financial hopes.

Tesco chief executive Dave Lewis has said that a store-wide limit on three items per shopper, for every SKU available in its outlets, is remaining in place for the time being.

Tobacco giant British American Tobacco has said that it is working on a potential coronavirus vaccine through its bio-tech subsidiary, Kentucky BioProcessing (KBP), with the first batches possibly ready by June of this year.

Britons made over 79 million extra grocery shopping trips in the four weeks to 21 March year-on-year as they stocked their 'pandemic pantries', driving a 20.5% jump in supermarket sales, industry data showed.

There is no shortage of food in Britain and nobody will starve during the coronavirus emergency, said the chairman of online supermarket Ocado who believes he himself has been infected.

Sainsbury's has said that it would help its smaller suppliers during the coronavirus emergency by paying them immediately and making finance available.

Hilton Food Group, the international food packing business, said that all of its facilities remain fully operational during the coronavirus outbreak.

While UK shoppers are spending more in store in the midst of the coronavirus crisis, only a minority are purchasing mass quantities of selected products, according to Kantar.

The limit for contactless in-store card transactions will be increased from £30 to £45 in the UK, beginning 1 April 2020, the BRC has said.

The Consumer Goods Forum has announced the cancellation of its Global Summit, scheduled for 16-19 June in London, due to the ongoing COVID-19 health crisis.

With food flying off the shelves as fast as exhausted shop assistants can replenish them, British supermarkets have stepped up their hiring to see them through the coronavirus crisis.

Amidst reports of panic buying in stores, as well as the introduction of quotas on certain product segments, a leading professor in supply chain strategy has offered advice on why panic buying is not the solution many consumers believe it to be.

Chocolatier Hotel Chocolat has said that it agreed an issue of new shares that would inject £20 million into the business, as it faces having to close its cafe and store locations due to Britain's coronavirus lockdown.

Marks & Spencer has said that while it expects its Food business to 'trade profitably' over the coming months, its Clothing & Home operations will face a 'substantial impact' on sales, due to the spread of coronavirus.

British American Tobacco, the world's No.2 tobacco maker, has said the coronavirus outbreak has not had any material impact on it as consumers continue to make purchases even in harder hit countries.

Online supermarket giant Ocado said growth in the last three weeks was double that of its first quarter, as panicked shoppers stock up on goods ahead of an expected shutdown to tackle the coronavirus.

The retail industry in the UK has welcomed the government’s decision to extend business rates holiday to all retailers to deal with the coronavirus outbreak in the country.

Online wine subscription company Naked Wines has temporarily stopped taking new orders after an unprecedented surge in business, the latest sign the coronavirus outbreak is spurring Britons to stockpile food and drink.

Sainsbury’s has introduced restrictions on the number of grocery items purchased by customers.

Panic buying by British shoppers over coronavirus is getting worse despite appeals for calm, and supermarket bosses are concerned the government is yet to get to grips with the magnitude of the crisis, industry sources told Reuters.

Britain's major supermarkets are working on plans to streamline their operations by cutting cafes, counters and other services to enable a depleted workforce to maintain basic provisions during the coronavirus outbreak, industry sources told Reuters.

Morrisons has announced plans to make immediate payments to farmers and local food manufacturers in a bid to deal with the coronavirus crisis in the country.

As global makers of household cleaners race to pitch their products as coronavirus killers, one major company, Reckitt Benckiser, may have a leg up on the competition.

Britain's biggest supermarket Tesco can keep shelves stocked and withstand shopper hoarding over coronavirus that has seen runs on pasta, hand sanitiser and toilet roll, its chairman has said.

Sales at WH Smith's stores in British airports have slumped by 35% as the coronavirus outbreak curbs travel, potentially denting its profit by up to £40 million ($51 million) this year, the British retailer said.

Just over a third (34%) of UK shoppers are already stockpiling food in case of an escalation in the coronavirus outbreak, a new study has found.

Consumer stocking up of household, ambient and frozen products in the wake of the coronavirus outbreak is likely to prove a 'zero-sum game' for retailers, with a short term sales boost likely to be echoed by lower demand in the months to come, a leading retail analyst has said.

Just over half of UK retailers surveyed in a new study by consultancy Retail Economics and law firm Squire Patton Boggs have experienced supply chain issues as a result of the growing coronavirus issue.

Ocado has advised customers to place orders further in advance because of 'exceptionally high demand', indicating a possible reaction from shoppers to the spreading coronavirus outbreak.

Primark owner Associated British Foods has warned of a risk of supply shortages on some lines later in the 2019-20 financial year if delays in factory production in China are prolonged due to coronavirus.

Reckitt Benckiser, which produces homecare brands including Dettol and Lysol, has announced a commitment of RMB 50 million (€6.5 million) in cash and antibacterial products to combatting the coronavirus outbreak in China.

© 2020 European Supermarket Magazine – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.

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