M&S clothing and homeware sales drive profits down 10%
British firm admits trading environment remains tough as it reports profits of €713m
M&S, one of the best known names in British retail, made a pretax profit before one off items of €713 million in the year to April 1st. Photograph: Chris Jackson/Getty
Britain’s Marks & Spencer reported a 10 per cent decline in annual profit and said clothing and homeware sales fell in its latest quarter, dampening the euphoria of the previous three months when it recorded a first increase in nearly two years.
The company recently poached Jill McDonald, the chief executive of Halfords, in an attempt to revive its struggling clothing and home sections.
The firm also said on Wednesday that the trading environment remained tough.
M&S, one of the best known names in British retail, made a pretax profit before one-off items of £613.8 million (€713.2 million) in the year to April 1st.
That was ahead of analysts’ average forecast of £593 million (€689 million) but down from £690 million (€801.7 million) made in 2015-16. The outcome reflects lower sales and higher costs.
Fourth-quarter clothing and homeware like-for-like sales fell 5.9 per cent, worse than analysts’ average forecast of a 3.3 per cent decline. They had increased 2.3 per cent in the previous quarter.
Like-for-like food sales fell 2.1 per cent.
The fourth quarter sales figures were hit by a later Easter falling outside the quarter and by the key days of the busy post-Christmas sale coming in the third, rather than the fourth, quarter.