At last, John Lewis gets Christmas cheer

John Lewis injected some festive magic back into the high street yesterday by revealing that last week's sales had set a record for the department stores group.

The retail doyenne, which like many of its competitors thought Christmas would never come, revealed that sales in the seven days to last Saturday rose by 0.6 per cent.

Gareth Thomas, the group's retail operations director, said the record had been achieved without the full help of its flagship Oxford Street store. Takings at the store were 26 per cent lower last Monday, the day the English rugby team paraded the William Webb Ellis trophy through the streets of London.

Mr Thomas said: "The three-quarters of a million people who came to the West End were there very much for the procession and not to combine the trip with gift shopping. We never really got that shortfall back."

Nevertheless the group's 26 department stores took £79.1m last week, up from £78.6m during the corresponding week last year. "That was on top of our previous best-ever week last year," Mr Thomas added, admitting he was "relieved".

Analysts have warned that this Christmas could be one of the toughest for retailers for years, as shoppers wake up to their record overdrafts and opt not to lavish presents on friends and family. Matalan, the discount clothing group, unnerved the sector with a profit warning last week and the City believes more could follow in the new year from retailers such as WH Smith. Dixons, Boots and Woolworths are among the companies under close scrutiny for signs that their aggressive sales pushes are holding up.

Mr Thomas said he was "reasonably confident" that John Lewis would break the £80m sales barrier this week for the first time in its history. He blamed the absence of cold weather for what he said had been a "difficult" season. "The very mild weather has contributed to a subconscious belief [among shoppers] that Christmas is further away. Sales have traded behind last year's levels, so the peak throughout the autumn and the build-up to Christmas has been later," he added.

With strong demand for all things digital, such as flat screen televisions and digital cameras, as well as for "feel-good" cosmetics, Mr Thomas said the only drag had been from clothing and home furnishings. "I can't remember such heavy levels of discounting [on clothing by our rivals] in October and November before," he said. Barring Next, he said John Lewis was "almost alone" in not starting its January sales early. Retailers as diverse as Marks & Spencer and Tesco have held extensive promotions in an attempt to shift unsold winter woollies and coats.

"I don't think our outperformance will be typical," Mr Thomas added.