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Christmas was an almost unqualified success, with retail sales well ahead of the market’s expectations. According to the Office for National Statistics, the seasonally adjusted value of retail sales in December rose by 1.1 per cent on November and by 3.7 per cent on 2005. Food sales remained strong, clothing and footwear picked up, and furniture and big-ticket homewares improved but remained below 2005 levels. Home accessories, textiles, toiletries and cosmetics also perked up.

Individually, post-period trading updates from the listed retailers mostly confirmed this. Among the big boys, Alliance Boots, owner of Boots the Chemists, recorded its ‘biggest-ever trading week in the run-up to Christmas for UK retail’, while across the high street at Marks & Spencer, Stuart Rose’s healing hands delivered a ‘strong performance’ and a 70 per cent-plus rise in website sales.

The influence of the internet was strong this year. AIM’s premier online retailer, ASOS, did not disappoint either, after problems beset its previous two Yuletides. The fashion specialist successfully shipped 710,000 items during the Christmas period and like-for-like sales were up 80 per cent for the four weeks to 10 December, which is the day before its warehouse was severely damaged by the Buncefield oil depot explosions last year. Rival e-retailer EBTM said it had beaten its Christmas sales targets, with a 275 per cent increase over the same period in 2005, and profits loom on the horizon. Chief executive Richard Breeden, a former UK music industry luminary at EMI, proclaimed: ‘In the light of current trading, we remain confident that we are poised for a sustained period of positive growth in a fast-growing market.’

The web was almost as much of a boon for mini home-shopping conglomerate Flying Brands, where like-for-like internet sales improved by an impressive 31 per cent. Offline, however, the Jersey-based group confirmed that trading had been mixed over Christmas, with its gifts and floral divisions trading well and the garden and entertainment divisions behind plan due to low new customer recruitment and the continued warmer weather.

Among other retailers, greetings card company Clinton Cards enjoyed a group like-for-like sales increase of 2.1 per cent, Blacks Leisure suffered from the ‘exceptionally mild’ autumn and observed a like-for-like fall of six per cent, and at photographic retailer Jessops like-for-like sales dropped 6.9 per cent as the 315-store group was unable to satisfy high demand for digital cameras due to major worldwide supply shortages.

Broker Seymour Pierce says that, outside of food-led, upmarket or online retail subsectors, the outlook for general retailers as a whole ‘looks as grim as ever’.