British retailer Marks & Spencer reported a 58% rise in annual profit, ahead of market expectations, as its strategy to re-shape the business delivered strong sales growth in both its food and clothing divisions.
The 140-year old retailer, one of the biggest names in British business, also said it was confident of further progress in its new financial year.
Improved Quality And Value
After two decades of failed turnaround efforts, M&S, under chief executive Stuart Machin, is finally reaping the rewards of an expensive investment programme to improve the quality and value of its clothing and food, upgrade its technology and e-commerce operations, and radically overhaul its store estate.
It made profit before tax and adjusting items of £716.4 million (€838.19 million) in the year to March 30 - ahead of analysts' forecasts which ranged £665 million (€777.05 million) to £705 million (€824.85 million) and the £453.3 million (€530.36 million) made in 2022/23.
Sales rose 9.4% to £13.1 billion (€15.33 billion), with food sales up 13.0% and clothing and home sales up 5.3%.
'Given our track record of delivering volume growth, market share and free cash flow we are confident that we will make further progress in 2024/25 and beyond,' M&S said.
Reshape For Growth
“Two years into our plan to Reshape for Growth we can see the beginnings of a new M&S," commented chief executive Stuart Machin.
"Food and Clothing & Home grew volume and value share ahead of the market and sales increased across stores and online. Both businesses have now delivered 12 consecutive quarters of sales growth and this trading momentum gives us wind in our sails, and confidence that our plan is working. We are becoming more relevant, to more people, more of the time."
In food, 1,000 products were upgraded and 1,300 new lines launched, while 'continued progress was made on value perception', it noted, with £60 million invested in pricing initiatives.
Additional reporting by ESM
