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Store openings prop up revenue

More pressure on Rowe as sales slip at M&S

Marks & SpencerMarks & Spencer’s normally solid food sales took a knock in the first quarter, adding to chief executive Steve Rowe’s turnaround challenge.

Like for like food sales, or revenue from stores where there has been no significant change in footage, fell by 0.1%. There was also another fall in like for like clothing sales, down 1.2%.

New Simply Food stores helped boost overall revenue in the division by 4.5%. Total UK revenue for the 13 weeks to 1 July was down 0.5% on a like-for-like basis and up 2.6% overall.

Mr Rowe said: “Trading in the first quarter was in line with our expectations and we are on track with delivery of the plan we announced last year. 

“I am pleased that we continue to grow full price sales in Clothing & Home, with reduced discounting and no clearance sale in the quarter. 

“In our Food business, we delivered strong growth from new Simply Food openings, and are prioritising better ranging and stronger promotions.” 

Clothing & Home revenue was down 0.5%.  In line with strategy, full price sales were up c.7%, as the company reduced the number of promotions and there was no clearance sale in the quarter compared with one last year. M&S starts its summer sale today, a week later than last year, with terminal stock for the season significantly down.

The company said it is focused on “tightening execution” through improving ranging in store and on delivering stronger promotions in a competitive market.

International revenue increased 3.8% (down 4.0% in constant currency).  Retained owned and franchise revenue was up 9.4% (1.4% in constant currency). It has  closed 28 of 53 stores in markets it is leaving.

Full year guidance remains unchanged.  The company will report interim results on 8 November.

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