UK's John Lewis enjoys record Christmas as rivals languish

By Neil Maidment

LONDON, Jan 2 (Reuters) - British department stores groupJohn Lewis scored a 7.2 percent rise in Christmassales, as strong demand for items from tablet PCs to coffeemachines helped it become one of this year's likely winners inthe UK retail sector.

The improvement comes despite unusually stormy Britishweather in the run-up to Christmas and a still-cautious approachby many consumers, sparking speculation that many retailerswould struggle during the key holiday period.

John Lewis said on Thursday sales from online outlets andshops rose to 734 million pounds ($1.2 billion) in the fiveweeks to Dec. 28, including its biggest-ever taking of 35.6million on day one of its in-store clearance sale on Dec. 27.

The increase contrasts with rival Debenhams, whichkicked off the UK retail reporting period on Tuesday with aprofit warning after a hoped-for surge in last-minute Christmasshopping failed to materialise despite heavy discounting.

John Lewis's performance is the latest consumer endorsementfor the employee-owned group, which has often outperformedcompetitors in recent years due to its strong online offering,modern stores and more affluent customer base.

The company also captured shoppers' attention this year withan animated advertising campaign featuring a bear being wokenfrom hibernation by an alarm clock gift, allowing it toappreciate a decorated Christmas tree for the first time.

Group like-for-like sales, which strip out the impact of newstores, rose 6.9 percent.

TOUGH FESTIVE PERIOD

Elsewhere a profusion of shop window discount posters inrecent days has illustrated retailers' attempts to attract morecustomers in a tough market, made harder by a spell of gales andheavy rain which kept many shoppers at home. Research this monthby accountants PwC found 72 of 100 town centre retailers wereoffering discounts or advertising promotions.

A decision by Britain's biggest clothing retailer Marks &Spencer to slash 30 percent off all clothing prices inthe Christmas build-up - the group's first such move in fiveyears - has raised fears it too has endured a tough festiveperiod.

Next, Britain's second-biggest clothing retailer, isdue to publish a trading update on Friday, while M&S is due toreport on Jan. 9.

Reflecting Britons' increasing tendency to shop via theirsmartphones and tablets, John Lewis said online sales in thefive weeks jumped 22.6 percent on a year ago and accounted for31.8 percent of total sales in the period, helped by recordonline orders on "Black Friday" (Nov. 29), a U.S.-originatedpromotion day becoming more common in Britain.

Electrical and home technology sales rose 10.7 percent,while fashion and beauty increased 8.5 percent, the firm said.

"With new highs in branches as well as for johnlewis.com,this has been a genuine omni-channel Christmas," Andy Street,managing director of John Lewis, said, adding the sales growthboded well for trading in 2014.