Rowe says 'more we need to do'
New M&S boss declares clothing slump ‘unsatisfactory’
Food once again outperformed the market in the last three months, with sales up 4% and market share by 4.3%, although like-for-like sales were flat.
Clothing fell 1.9%, or 2.7% on the same basis as last year as the high street chain was left with unsold stock. However, there were fewer discounts and the decline in sales showed signs of slowing.
Sales from the online division rose 8.2% with further improvement in customer satisfaction.
Overall group sales rose 1.9% and the company continued to cut costs, though staff say this has been felt in morale and deteriorating conditions.
The company will report its full year results on 25 May.
Mr Rowe said: “I am very proud and privileged to be leading M&S. We are focused on getting even closer to our customers and putting them at the heart of everything we do.
“We had a mixed performance in the final quarter of the year. Our food business once again outperformed the market by c.3.5%. Although the sales decline in clothing and home was lower than last quarter, our performance remains unsatisfactory and there is still more we need to do.
“Turning around our clothing and home business by improving our customer offer is our number one priority. I will update you on my thoughts on the business in May.”
The Food business continued to outperform a highly competitive market, helped by a store opening programme. Eighty opened in the year. The company continued to invest in special and different products launching 400 lines.
M&S said that it faced a “challenging backdrop” in clothing and home, characterised by price deflation and a flat market.
Spring/Summer season launched with significantly higher product availability than last year.
The company said it “continued to make improvements across range and design,” and said Autograph sales were up 10%.
“We also began to reduce the proportion of sales on promotional discount and will continue to do so as we head into the new financial year,” it said.
“However as flagged at quarter three, we had more stock into sale. At the same time, we invested in sharpening our prices on a number of lines, whilst delivering a strong gross margin improvement. Although these actions contributed to the sales run rate improving since the last quarter, we still have a number of areas to address.
“M&S.com delivered a good performance with strong improvement in customer satisfaction scores driven by improved website speed and ease of navigation. We ran fewer online only promotions giving customers a more consistent shopping experience across our channels.
“Despite improved sales in both our franchise and owned businesses in International, the previously guided currency pressure and challenging trading conditions are still expected to heavily impact the full year profitability.”