Retail round up - The Sunday papers
The Sunday Telegraph
Sainsbury's is to become the first UK supermarket to ban the use of "super-global-warming" chemicals in its refrigerators – instead cooling its food by carbon dioxide. The decision, due to be announced this week by Sir Justin King, the chief executive of Sainsbury's, will come into force as a group of MPs and green campaigners lobby for a ban on so-called F-gas (hydrofluorocarbons) chemicals by 2015. Experts have calculated that F-gases, the currently used refrigerants, are 1,420 times more damaging to the climate than carbon dioxide, making the annual leakage from UK supermarkets the equivalent of one billion trips to the shops by car. The refrigerants became widely used during the 1990s to replace gases that harmed the ozone layer – but have turned out to be equally attacked by environmentalists.Sainsbury's, which is expected to report first half pre-tax profit on Wednesday of £300m, up 16pc from £259m last year, will make a multi-million pound investment in the new refrigeration. It claims the move will cut overall emissions by one third. Full article here.
Theme park operator Euro Disney is expected to post a sharp decline in revenue, plunging it from net profit into loss, when it announces its results on Thursday. The company, which runs the Disneyland Paris resort on the outskirts of the French capital, has been battered by the downturn as more holidaymakers have stayed at home and the pound has reached record lows against the euro. The figures will come alongside Walt Disney Company's 2009 annual results. Analyst David Joyce of Miller Tabak & Co expects a 6.5pc decline in revenue on last year's $37.84bn (£22.7bn) and a 24pc decline in operating income with "percentage-wise, the largest decline being the studio entertainment division because Disney has been reducing the number of new releases, but it has also been challenged on the DVD front". Full article here.
The Sunday Times.
Britain’s supermarket chains have launched the biggest discounting bonanza in years for this festive season, with toys, DVD boxed sets, Christmas decorations, clothes and electricals all on sale more than a month and a half before the big day.The discounting frenzy comes as the big four grocers slug it out to capture entertainment and toy sales following the collapse of Woolworths and Zavvi. The price cuts — including sales of supermarket clothing ranges — are striking fear into the hearts of high-street retail bosses who worry the supermarkets are using their buying power and low cost base to offer extravagant deals. “There seems to be bigger discounting than ever — it’s vicious out there,” said one leading retail executive. “You have to fight your corner or people won’t shop with you. All the retailers are getting dragged into discounting — there isn’t any choice.” Full article here.
The owner of Mappin & Webb, Watches of Switzerland and Goldsmiths is poised to agree a debt for equity swap to halve its borrowings.Aurum Holdings, chaired by House of Fraser director Don McCarthy, was putting the finishing touches to the deal late on Friday with Iceland’s Landsbanki to convert £42m of debt into equity.The deal would cut its borrowings from £97m to about £55m. At the same time, the company is expected to put in place a new seven-year £10m mezzanine loan provided by Landsbanki, McCarthy and the company’s management team. The restructuring talks began ahead of the expiry of a key loan facility in the next 12 months. After the refinancing, the management, headed by Justin Stead, will own 33% of the company.
Shop Rents on London’s Bond Street, home to the world’s glitziest brands, are poised to defy the credit crunch and smash through £900 per square foot — a record in Britain.Retail sources said that luxury conglomerates, thought to include LVMH and Richemont, owner of Cartier, were believed to be eyeing part of a prime unit available at 169 New Bond Street. Property agents said they expected a deal to be sewn up in the next few weeks.“This is a once in a lifetime opportunity to secure a spot like this,” said one property source. “The deal will blow existing rental benchmarks out of the water.” Full article here.
The Independent on Sunday
Bokks, a new luxury gift buying service fronted by celebrities, including supermodel Veronica Webb, actor Dustin Hoffman, and designers Neil Barrett and Tom Ford, is set to launch tomorrow in London. The concept came about when Walter Bugno, the new chief executive of Bokks and the ex-boss of Australia's Sydney football club, sold his previous company and struggled to find a single place from which to buy his staff top- quality gifts. Mr Bugno also wanted to have the gifts hand-delivered, so he's offering customers the option of hiring a white velvet-gloved "bellhop" porter to deliver the gifts to the recipients' doors. Fashion designer Karl Lagerfeld is advising Mr Bugno on the launch while supermodel Webb will be helping him choose which gifts to go for.Analysts will be hoping that the start-up will be a boost for the luxury goods industry which is still suffering the consequences of the downturn. Items available through the service will cost from £250 up to as much as £1m. Bugno said: "There is nothing cheap. It may be expensive but not expensive for quality." There are also plans to open a Bokks shop later this year and Mr Bugno then hopes to take the service overseas.
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