Retail round up - The Sunday papers
The Sunday Telegraph
Jon Asgeir Johannesson, the Icelandic retail tycoon who made £600m buying up British high street chains, has claimed in court that he is now down to his last million.Mr Johannesson is fighting lawsuits in London and New York alleging that he led a conspiracy to siphon $2bn (£1.4bn) out of Iceland's collapsed bank Glitnir – which he strongly denies.The High Court has frozen his assets, but Mr Johannesson claims he only has £1.1m left.
UK businesses were cushioned by stronger growth and support measures in the second quarter of the year but companies will run into greater difficulty in the year ahead as the coalition's austerity measures start to bite, a report has warned.Profit warnings fell to a near seven-year low of 45 between April and June, from 54 in the first quarter, with expansionary fiscal policy helping to keep the number low according to Ernst & Young. It was the first time warnings were below 50 since 2003."This will be the last period in which an expansionary fiscal policy helps to keep profit warnings low, and a number of companies have already cautioned that they expect much tougher times ahead, when further fiscal tightening reins in public sector and consumer spending," said Keith McGregor, restructuring partner at the accountancy firm. Full article.
China's exports grew faster than expected last month, offering reassurance on the strength of the recovery in the world economy and adding to the country's huge trade surplus.The 43.9pc increase in exports left China with a $20bn (£13.3bn) trade surplus. Its customs bureau said trade has "recovered" to levels seen before the financial crisis.The pace of growth was slightly slower than in May, when exports increased by 48.3pc, but the deceleration was not as great as had been expected.
The Independent on Sunday
Marks & Spencer has initiated a major market-research programme to find out how tax rises and public spending cuts will affect customers.The retailer has already imposed a highly prudent approach to buying autumn clothing amid concerns of a downturn.The company's fears could emerge at its shareholders' meeting this week. Its chief executive, Marc Bolland, said: "All the external indicators say people for the next year will have concerns on their consumer spend. Therefore, we are very cautious." But Mr Bolland, who took over the top job in May, is no longer prepared to rely on outside indicators and has set-up a widescale research initiative inside M&S to report on consumer reactions to the rise in VAT to 20 per cent, and on other measures in last month's Budget. Full article.
Nearly half of Britons are cutting down on eating out and going to the pub amid concerns about the country's economic prospects.Substantial cut-backs in household spending could lead Britain into a double-dip recession, warned GfK NOP, a market research company.Most the consumers surveyed believe that the economy is set to weaken further. And the public are lowering spending due to concerns that interest rates, which are currently negligible, will rise in the coming months.Two-fifths of consumers will be cutting back on purchasing household items such as furniture and electrical goods and many are refusing to spend on credit cards.Ivan Browne, the director of GfK NOP, said: "It is ironic that a reduction in consumer spending – driven by economic uncertainty – could bring about the thing people are most concerned about: a dip back in to recession."
The Mail on Sunday
The future of internet grocer Ocado is in doubt this weekend after the disclosure that the company will not be a going concern unless its stock market flotation succeeds.Auditors to the company have expressed doubts about its ability to continue to trade without the sale of shares and a new £100million loan that depends on a successful float.But potential British investors have been less than enthusiastic about buying the shares and Ocado's top executives are believed to be about to fly to America to try to win support. Full article.
American electronics giant Best Buy, whose top British executive quit suddenly just days ago, faces fresh turbulence amid claims that it does not control its trading name in Europe.Financial Mail can reveal that a bitter legal row erupted after a rival electronics retailer claimed to have the European Union trademark rights to the name and asked Best Buy to stop using it.The US business, which has a turnover of $50billion (£33billion), launched in Britain three months ago and has since opened three stores. It aims to open up to 80 megastores here through its partnership with Carphone Warehouse.Full article.
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