Tesco PLC (TSCO.LN), the U.K.'s biggest retailer, reported a modest rise in underlying sales Tuesday, held back compared to some of its supermarket rivals by a greater exposure to non-food lines like clothing and electricals.

Tesco said U.K. same-store-sales, excluding fuel, rose 2.5% for the seven weeks to Jan. 10 from a year earlier, bang in line with market expectations. The retailer booked a 33% jump in International sales, helped by favorable exchange rate movements in Europe, and a particularly strong performance in Asia. Group sales rose 12%.

Tesco's U.K. performance is weak compared to rival J Sainsbury PLC (SBRY.LN), which last week reported a better-than-expected 4.5% rise in same-store-sales, excluding fuel, for the fiscal-third quarter ended Jan. 3, underpinned by its best Christmas results to date.

William Morrison Supermarkets PLC (MRW.LN) is expected to outperform the local grocery sector when it reports on Jan. 22, with analysts forecasting a 8.5% rise in same-store-sales, excluding fuel.

The GAME Group Tuesday unveiled a strong Christmas performance, with sales for the six week period ended Jan. 10 up 16.6% and like-for-like sales up by 5.4%. The company expects that Group gross margin for the 53 weeks to Jan. 31 will be around 140 basis points ahead of last year at 26.2% and slightly ahead of previous guidance.

Christmas updates so far from U.K. retailers indicate the Yule Tide period wasn't as bad as many had expected.

Still, U.K. retail sales posted their worst Christmas performance on record in December, as broad-based weakness sent sales plunging, according to the British Retail Consortium.

The question in the months to come is whether spending will dry up now that Christmas is over and the sales are coming to an end.

The overall picture for Christmas 2008 so far is that food and discount retailers did better than sellers of big-ticket electrical goods, home furnishings and satellite navigation systems.

On Thursday, news of big falls in same-store sales are expected from DSG International PLC (DSGI.LN), the country's biggest electrical goods retailer, and from Home Retail Group PLC (HOME.LN), which operates do-it-yourself chain Homebase and general-merchandise chain Argos.

Last Friday, sportswear retailer JD Sports Fashion PLC (JD.LN) pleased investors by saying it expects full-year profit to beat market forecasts after it had a lucrative Christmas. Meanwhile shares in Jessops PLC (JSP.LN) soared Friday after the nation's biggest photographic retailer posted higher seasonal period sales.

Good holiday sales were also reported by department store House of Fraser and fashion retailer Peacocks. Upmarket fashion group Ted Baker however said heavy discounting over Christmas hit its margins and it now expects full-year profit to be at the lower end of market expectations.

Sainsbury's strong showing also contrasted with last Wednesday's poor Christmas trading update from Marks & Spencer Group PLC (MKS.LN), which had its worst quarterly sales performance for a decade and responded by closing 27 stores and cutting 1,230 jobs.

The U.K. retail holiday trading season kicked-off on Jan. 5 when both U.K. department store chain John Lewis and London department store Liberty PLC (LBE.LN) presented encouraging sales reports.

The following day, Next PLC (NXT.LN), Debenhams PLC (DEB.LN), New Look and The Co-operative reported better-than-expected Christmas sales performances.

The sector's downturn has nonetheless claimed a number of victims.

U.K. sofa retailer Land of Leather PLC (LAN.LN) became the latest high-profile retail casualty of the U.K.'s struggling economy Monday, when it was placed in administration. Others forced into administration include china and glass group Waterford Wedgwood PLC (WTFU.DB), Passion for Perfume Ltd., Adams Childrenswear Ltd., clothing chain USC, CD, DVD and video game retailer zavvi, coffee-and-tea purveyor Whittards of Chelsea, clothing chain the Officers Club, Woolworths Group PLC (WLW.LN) and furniture retailer MFI.

Other U.K. retailers that are scheduled to report trading performances in coming days include:

 
Thu, Jan. 15: DSG International PLC (DSGI.LN) update 
              Home Retail Group PLC (HOME.LN) 3Q 
              HMV Group PLC (HMV.LN) trading update 
              JJB Sports PLC (JJB.LN) trading update 
              Carphone Warehouse Group PLC (CPW.LN) 3Q 
              Associated British Foods PLC update 
              Halfords Group PLC (HFD.LN) trading update 
              Mothercare PLC (MTC.LN) trading update 
              Galiform PLC (GFRM.LN) trading update 
 
Mon, Jan. 19  ASOS PLC (ASC.LN) trading update 
 
Tue, Jan. 20: Kesa Electricals PLC (KESA.LN) trading update 
 
Thu, Jan. 22: William Morrison Supermarkets PLC (MRW.LN) 
 
Mon, Jan. 26: WH Smith PLC (SMWH.LN) AGM trading update 
 
Tue, Feb. 3: Carpetright PLC trading update

-By Lilly Vitorovich, Dow Jones Newswires; 44-0-207 842 9290; lilly.vitorovich@dowjones.com

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