Jan. 4 (Bloomberg) -- U.K. retailers issued the highest number of negative sales updates in almost two years during the final quarter of 2007, accounting firm Grant Thornton said.

Some 22 percent of retailers listed in London gave negative statements, up 7 percentage points from the third quarter, Grant Thornton said today in an e-mailed statement. That was the highest since the first quarter of 2006, the research shows.

British incomes are under pressure from higher mortgage repayments, taxes, utility bills and food prices. DSG International Plc, Europe's second-biggest consumer-electronics retailer, said yesterday annual profit will miss analysts' estimates after holiday sales slid. The number of visitors to U.K. shops fell 3.2 percent last month, according to Synovate's SPSL.

``Consumer confidence appeared to fall significantly during the final quarter of 2007,'' David Bush, head of retail services at Grant Thornton, said in the statement. ``It remains to be seen whether post-Christmas sales will have been enough to fully offset the slow start to Christmas trading.''

The proportion of positive statements released in the fourth quarter dropped 21 percentage points from the prior three months to 41 percent, according to Grant Thornton. The proportion of non-food retailers reporting higher same-store sales slid 28 percentage points to 55 percent. All food and beverage retailers posted revenue gains on that basis.

To contact the reporter on this story: Amy Wilson in London at awilson23@bloomberg.net.

Last Updated: January 4, 2008 05:33 EST