More frustration for high street chain
Marks & Spencer recovery stalls as clothing sales slip
There was a small revolt against his re-election but his controversial pay package was backed by 99% of those voting at the AGM despite more evidence of a slide in performance.
In those stores open for at least a year revenue from general merchandise, which includes clothing and furnishings, was down by 0.4% in the first quarter.
The high street chain preferred to focus on a 38.7% rise in online sales, though it acknowledged that this was on the back of disruptive problems at a distribution warehouse last year.
A slip in clothing sales will disappoint investors who were optimistic about prospects after the company’s final quarter of last year showed its first increase in underlying sales of general merchandise for four years, when like-for-like sales of clothing and home furnishings rose 0.7%.
Food was again strong in the first quarter with like-for-like sales up by 0.3%. The company launched 700 lines including the new Taste of the British Isles range. It is on track to open about 90 Simply Food stores this year, and continues to see good performance from existing stores.
Mr Bolland said: “We continue to make progress against our key priorities. Our food business did very well in a difficult market. In general merchandise, sales were broadly level on last year and we are on track to deliver the planned increase in gross margin. M&S.com performance was very strong, with customers appreciating all the improvements to our website.”
John Ibbotson of the retail consultants, Retail Vision, said: “While its all-important general merchandise results are marginally better than expected, like-for-likes have still declined against an easy comparative. However you dress this up, it’s still not good enough.
“The hard numbers show that Marc Bolland’s much touted recovery in general merchandise has come off the rails once again, so it’s no wonder there is shareholder dissatisfaction with his bonus.
“M&S may have increased its margins, but this is a retailer that lives or dies on the performance of its General Merchandise, and the performance there is consistently poor.
“Time is running out for Bolland and no amount of free in-store collection will stop that.
“As hard as it is to stomach, the one-time colossus of British retailing is now an also ran, with the likes of Next, Primark and the internet operators ripping away its clothing market share.
“It’s make or break time for M&S. No amount of restructuring and transformation of IT and logistics will be enough if clothing sales don’t improve soon.”