Europe Movers: B&M Value, Marks & Spencer, Tesco

Inga Muller
09 Jan, 2025
Frankfurt

The Euro Area retail sales struggled to advance in November amid high costs of living and elevated interest rates. 

Germany's trade surplus shrank after exports fell faster than imports. 

The DAX index decreased by 0.2% to 20,294.40; the CAC-40 index rose by 0.2% to 7,464.24; and the FTSE 100 index inched higher by 0.6% to 8,304.35. 

The yield on 10-year German bonds edged higher to 2.52%, French bonds rose to 3.38%, the UK gilts increased to 4.83%, and Italian bonds rose to 3.70%.

Tesco PLC declined 1.8% to 363.56 pence despite the grocery retailer reporting strong sales growth in the holiday period. 

Sales in the third quarter ending on December 23 increased 2.8%, powered by a 3.8% rise in the U.K. and 2.8% in Central Europe.

Sales in the four-week holiday period ending on January 4, 2025, increased 3.8%, powered by a 4.1% advance in the U.K. and a 4.7% jump in Central Europe. 

Food sales in the UK rose 4.7%, and overall online sales jumped 10% in the quarter. 

The company reiterated its adjusted operating earnings estimate in the fiscal year 2025 to £2.9 billion and free cash flow from its retail operation between £1.4 billion and £1.8 billion. 

Marks & Spencer Group Plc plunged 7.4% to 363.56 pence after the retailer reported higher-than-expected holiday period sales, but the company's warnings about costs and headwinds in the months ahead dragged the stock down. 

Group sales in the quarter ending on December 28 increased 5.6% to £4.06 billion, driven by an 8.7% increase in food sales to £2.6 billion and a 1% rise in apparel, home, and beauty sales to £1.3 billion. 

UK and Ireland sales advanced 5.9% to £3.9 billion, and international sales dropped 2.8% to £178 million. 

B&M Value Retail SA dropped 10.5% to 307.38 pence after the discount retailer lowered its annual earnings outlook. 

The variety store tightened its adjusted operating earnings outlook range to between £620 million and £650 million from the previous range between £620 million and £660 million. 

Sales in the fiscal third quarter from a year ago increased 2.8% to £1.4 billion in the U.K. and 12.5% to £164 million in France.

Comparable same store sales in the UK in the fiscal third quarter declined 2.8%, but the growth picked up in December 2024 and retained its momentum in January 2025.  

Comparable same store sales in France in the quarter was 3.8%. 

The company said it is on track to open 73 new stores in the current fiscal year, including 45 B&M in the UK, 11 B&M in France, and 17 Heron Foods stores, and estimated additional 45 new B&M UK stores in fiscal 2026. 

The discount retailer declared 15 pence per share dividend to shareholders on record on January 17 and payable on February 14.