Woolworths Announce Slowing Sales

High street retailer Woolworths has today announced falling sales over the Christmas period off the back of growing unrest in the economy which has had a significant impact on consumer spending, resulting in an 11% drop in share price over the course of the day amidst growing concern for the global retail environment.

The company announced that sales over the last year had fallen by some 3% following the sub-prime collapse, rising interest rates and growing competition for sales on the high street and online over the period. The news marks yet another major retailer reporting problems over the year, as consumer confidence is falling significantly off the back of wider economic problems.

Much of the sales decline has been attributed to the slowdown in sales for electrical goods, particularly personal computers, laptops and LCD televisions, amidst falling consumer confidence as a result of the sub-prime collapse and the growing hostile environment for retailers throughout the UK following the economic reverberations from the US.

Shares in Woolworths today traded down by over 11% to 8.88p over the course of the morning in reflection of what is seen as a growing problem for retailers, and something that is likely to continue to be problematic for the coming twelve months.

However, analysts have suggested that Woolworths’ lack of remedial action could lead to further problems for the retailer, and could be something to do with the level of problems suffered by the group thus far.

“Woolworths has unfortunately done little to alleviate the current High Street gloom,” said Hargreaves Lansdown broker Richard Hunter.

It remains to be seen whether Woolworths can begin to improve on its performance over the end of 2007, although there remains no doubt that the coming year will prove difficult.

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