Shares in Marks & Spencer Group (LON:MKS) have fallen into the red in today’s session, as the blue-chip retailer revealed that its sales had continued to fall in the first half of its financial year. The group, which is currently undergoing restructuring under chief executive Steve Rowe and chairman Archie Norman, further said that it expects little improvement for the full year.
As of 08:47 GMT, Marks & Spencer’s share price had given up 2.02 percent to 295.83p. The shares are underperforming the broader UK market, with the benchmark FTSE 100 index having jumped in London in today’s session and currently standing 1.12 percent higher at 7,119.62 points.
M&S posts interim results
Marks & Spencer announced in a statement this morning that its revenue had fallen 3.1 percent to £4.97 billion in the 26 weeks ended September 29, noting that it was adversely impacted by Easter timing, as well as accelerated UK store closures. Like-for-like Food sales dipped 2.9 percent, while the group’s clothing and home division saw a 1.1-percent drop. The company, however, delivered a two-percent rise in profit before tax to £223.5 million.
“This phase is about rebuilding the foundations of the future M&S,” the retailer’s chief executive Steve Rowe commented in the statement, adding that the group was “on track to restructure our store portfolio with over 100 full-line closures”.
M&S meanwhile cautioned that challenging trading conditions and growth of online competition and pressure from discounters meant that the group was ‘expecting little improvement in sales trajectory’.
Analysts weigh in on update
“Reading through M&S’s half year results is like taking a cold shower,” said Tom Stevenson, investment director at Fidelity Personal Investing’s share dealing service, as quoted by the Guardian, adding, however, that the half-year update was in line with expectations.