Sales are expected to grow more quickly this month although they are likely to remain

Sales are expected to grow more quickly this month, although they are likely to remain below average for the time of year.. MAGNUS GRIMOND Glaxo Wellcome yesterday lost a legal judgment in favour of the Inland Revenue, which is now free to pursue the company for hundreds of millions of pounds of back tax. However, the drugs giant said the High Court ruling was only on procedural issues and was not indicative of a tax liability on the company's part.The company has already made substantial provisions, estimated to be up to pounds 400m, against an unfavourable outcome of the case.A spokesman said: "The judge was quite clear. It was the third consecutive drop in clothing sales, although shoe and leather sales had seen a healthy increase in September.Business was more buoyant at big retailers than small ones, according to the survey. They had expected only a modest decline.The survey showed that the positive balance of retailers reporting higher versus lower sales was 16 per cent. Booksellers and stationers, chemists, and stores selling household durables, furniture and carpets enjoyed the biggest increases in annual sales.Thanks in part to price discounting since the end of the Net Book Agreement, booksellers saw their biggest rise in sales since September 1994, leaving the volume of business well above average. The balance of bookstores reporting higher sales compared to lower sales was 45 per cent, a turnaround from a balance of minus 50 per cent in August.Chemists' sales volumes were also above average, having climbed for the third month in a row. Retailers were disappointed by sales in October, as they have been for nine out of the past 12 months Sales remained below average for the time of year.

Motor traders were particularly disappointed, reporting a sharp annual fall in sales. ``It is to be hoped the competitive trading environment is now encouraging previously cautious consumers to step up their spending in the critical pre-Christmas period.''The CBI said the trend in sales over the past three months suggests they have resumed a modest upward path. Rank Organisation, operator of the largest bingo chain, fell 19p to 408p. Bass, owner of the Coral betting chain, slipped 4.5p to 674.5p.Ladbroke said turnover in Vernons was down 27 per cent in the first nine months of the year.

The problems with the Lottery had been exacerbated by this year's hot, dry weather, which had led to smaller fields at races, with resulting poorer returns for bookies, and higher costs due to the start of Sunday meetings this year. There had also been a downturn in credit betting, dominated by big spending overseas clients.Profits at Hilton International, the hotels operation, were ahead of last year in the third quarter, although the rate of growth had slowed from the first half, Ladbroke said.Investment Column, page 23. DIANE COYLE Economics Correspondent Retail sales picked up sharply last month, according to the latest survey from the Confederation of British Industry. We have responded by making some 500 people redundant in Vernons and Ladbroke Racing."Three hundred of the job losses were announced earlier this year, with a further 150 cut at Vernons, the pools business, last week. Analysts said they now expected the betting and gaming division to make only marginal profits in the second half ending in December.