THE past few days have provided further evidence that, at best, the run-up to Christmas was a mixed time for retailing.

Marks & Spencer's third quarter trading statement produced like-for-like sales down by 5.1 per cent.

As expected, the major disappointment was in clothing though this was offset by an improved performance in home furnishings and food.

The stock market was pleased by the 80 basis point improvement in the company's profit margin.

At the time of writing the share price has made progress again above the £2 level which perhaps says more about how low analysts' expectations were as opposed to the strength of the figures.

Following market rumours, Iceland released a trading statement confirming disappointing figures.

Like-for-like sales over the Christmas period in the food stores registered a decline of 5.5 per cent, with the company placing part of the blame on its move last year into organic products.

Elsewhere, bid activity continued apace with the Bryant/Beazer merger being derailed by the entry of two other house builders.

Taylor Woodrow now has the upper hand with regards to Bryant, and the two companies combined will be the UK's fifth largest house builder.

York builder, Persimmon, now looks set to take over Beazer though a further twist to the story cannot be ruled out.

Following RWE's takeover of Thames Water last year, fellow German utility E.ON is making overtures to Powergen. The latter has stated it may be talking to a number of parties though the German company remains the favourite to both make a bid and succeed.

Other suitors could include ScottishPower though it is unlikely that shareholders will see much of an improvement on the current share price of just over £7.

John Pearson

associate director

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