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Highlights
- Marks and Spencer’s clothing and home revenue rose by 92.2% year-on-year and declined by 2.6% compared to the same period in 2019/20.
- WH Smith’s high street retail business revenue in the H2 2021 was 85% of the 2019 figures.
- JD Fashion reported opening of 21 new stores in Western Europe and six new stores in the Asia-Pacific region in H1 2021.
Retailers registered a slowdown in their post-pandemic recovery in September 2021 due to the decline in sales to its weakest since the beginning of the year when heavy lockdown restrictions impacted business operations. The BRC-KPMG retail sales report demonstrated a negative trend heading into the holiday period. Prominent retailers Marks and Spencer, WH Smith, & JD Sports Fashion have reported the deep impact of Covid-19 on their businesses.
According to the BRC-KPMG report, total retail sales rose by 0.6% year-on-year in September 2021 and registered an average growth of 3.1% in the last three months. Online non-food sales were lower in September as more people returned to high street retail stores. Barclaycard also reported a dip in consumer confidence last month due to rising concerns about oversupply and fuel shortages.
(Data source: EODHD/Others)
Here is a detailed review of 3 retail stocks - Marks and Spencer, WH Smith, & JD Sports Fashion.
Marks and Spencer Plc (LON: MKS)
Marks and Spencer Group is a UK-based multinational retailer that specialises in selling clothes, homeware, and food products. For the 19 weeks ended 14 August 2021, the company’s clothing and home revenue rose by 92.2% year-on-year and declined by 2.6% compared to the same period in 2019/20. The company’s food revenue during the period increased by 10.8% year-on-year and 9.6% in 2019/20.
The shares of Marks and Spencer last traded at GBX 172.75, down by 0.89% on Monday 11 October 2021. The market cap of the company currently stands at £3,413.44 million.
Due to the lifting of the COVID-19 related restrictions on trading, the company increased its guidance for an adjusted profit before tax for the year to be in the upper range of its previously announced guidance of £300 million - £350 million. Nevertheless, the shortage of HGV drivers and supply chain crisis is expected to impact the company’s financial performance in the coming months.
The shares of Marks and Spencer returned 74.14% to shareholders in the last one year.
WH Smith Plc (LON: SMWH)
WH Smith is a British retail chain that operates stores in railway stations, ports, airports, motorway service stations and hospitals. The company’s travel and high street revenue business was impacted by the Covid-19 pandemic. Its group revenues for the 8 weeks ended 28 August 2021 was 71% of the financial year 2019 figures.
The shares of WH Smith last traded at GBX 1,618.50, down by 0.49% on Monday 11 October 2021. The market cap of the company currently stands at £2,129.23 million.
For H1 2021, the company’s group revenues were 60% of 2019 figures, and H2 revenues were 65% of 2019 figures. The company’s high street retail (that encompasses internet and well-located store sales) revenue in the H2 2021 was 85% of the 2019 figures.
The shares of WH Smith returned 57.90% to shareholders in the last one year.
JD Sports Fashion Plc (LON: JD.)
JD Sports Fashion is a sports-fashion retailer that operates in the UK, US, Europe, Australia, Asia and New Zealand. For the six months ended 31 July 2021, the company reported the opening of 21 new stores in Western Europe and six new stores in the Asia-Pacific region.
The shares of JD Sports Fashion last traded at GBX 1,026.00, down by 1.49% on Monday 11 October 2021. The market cap of the company currently stands at £10,744.40 million.
For H1 2021 ended 31 July 2021, JD Sports revenue reached £3,885.8 million compared to £2,544.9 million for the same period in 2020. Its profit before taxes for the period reached £364.6 million from £41.5 million in 2020.
The shares of JD Sports Fashion returned 30.73% to shareholders in the last one year.
