Ratings agency Moody's has upgraded Marks & Spencer to a Baa3 long-term issuer rating and changed its outlook on the business to 'stable' from positive.
Moody's has also upgraded the company's senior unsecured long-term ratings to Baa3 from Ba1 and the provisional rating on the £3 billion (€3.6 billion) senior unsecured MTN (medium-term note) programme to (P)Baa3 from (P)Ba1.
The upgrade follows robust performance by Marks & Spencer in its full financial year 2024, which continued in the first half of 2025 and showed prospects for further growth.
Moody's also considered the company's established market position and improving competitiveness, underpinned by an ongoing multiyear transformation plan to structurally reduce operating costs, raise margins, and gain market share.
The ratings agency noted that Marks & Spencer continued to improve its operating performance amid challenges that other UK and European retailers are also facing.
These include an uncertain macroeconomic environment, changing consumer preferences, and inflationary pressures.
Outlook
Moody's anticipates moderate revenue growth in mid-single digits for the retailer and stable to slightly growing margins over the next 12-18 months, with a further moderate improvement of the debt metrics.
The 'stable' outlook reflects the ratings agency's expectation that Marks & Spencer will execute its strategic initiatives and transformation plan.
It also expects the company to maintain 'excellent liquidity' and moderate financial practices.
Earlier in November, the British retailer forecast 'further progress' in the balance of the year after reporting a better-than-expected 17.2% rise in first-half profit, helped by market share gains, adding to evidence its latest turnaround plan is working.
Read More: Marks & Spencer’s First-Half Results: What The Analysts Said
