A rise in tobacco duty in the budget led to a fall off in cigarette sales, according to Britain's biggest cash and carry wholesaler.
Ahead of its annual meeting Booker said tobacco sales had fallen by 1.7% in the 12 weeks to 22 June, its first quarter. But sales of other products made up the difference - up 3.8% despite the bad weather and the squeeze on consumer spending- and so total sales climbed 1.7% on a like for like basis. However this was a slowdown on the 4.8% increase seen in the fourth quarter, although the company said it was on track to meet full year profit expectations. It added that the £140m acquisition of Makro UK from its German parent was successfully completed at the start of July. The company's shares have climbed 1.45p to 87.7p and analysts were generally positive. Nicola Mallard at Investec said:
It appears that fears the weather would have had a dampening effect on the group's performance in the quarter have perhaps been overplayed. We leave our forecasts unchanged at this early point, but remain buyers with an unchanged target price of 98p.
