M&S posts sharp jump in annual profits

Marks and Spencer (M&S) posted a big jump in annual pretax profits today.

Marks and Spencer (M&S) posted a big jump in annual pretax profits today.

The chain, two years into its three-year recovery plan, said pretax profit excluding exceptional items was £751.4 million (€1.09 billion), in line with guidance from the company after blistering fourth-quarter sales reported in April.

Customer visits are up 350,000 to 15 million a week, M&S said. They are being tempted back into the stores with the help of an award-winning television advertising campaign featuring 1960s fashion icon Twiggy.

Mr Rose, who joined in 2004 to defeat a £9.1 billion bid by Philip Green, has been rebuilding profit margins at the retailer with improved buying terms and reduced markdowns.

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A priority for 2006/7 is a £520 million to £570 million plan to refurbish 35 per cent of the group's selling space.

A new format being tested in 23 stores generated sales growth averaging 10 per cent in the fourth quarter, M&S said.

Shares in the resurgent M&S have risen 68 per cent in the last 12 months, outperforming the FTSE 100 by 52 per cent and valuing the group at £9.5 billion.