British retailer Marks & Spencer said it was hopeful the downturn in its markets had levelled off as it posted a 40 per cent slide in full-year profits and slashed its dividend to conserve cash.
“I'm not into 'green shoots' mode but I am (thinking) maybe this is a plateau at the bottom,” executive chairman Stuart Rose told reporters on a conference call.
“There's a push-pull going on at the moment between the consumer who is wanting to be more cheerful ... (while) there are still some issues in the financial markets which could destabilise things.”
Many of Britain's retailers have been struggling as shoppers cut spending amid rising unemployment, sliding house prices and fears of a long recession.
Mr Rose said M&S' trading in the first seven weeks of its new financial year had been broadly in line with fourth quarter trends and it was cautious on the outlook for the remainder of the year.
Sales growth was still negative, “but particularly in foods we've had an improving performance since the late part of last year,” he said.
“I anticipate that we can keep that going and I'm hopeful that the sales level in clothing will slowly improve.”
Shares in M&S have lost 18 per cent of their value over the last year but have risen 23 per cent over the last three months on recovery hopes, outperforming the DJ Stoxx European retail index by 15 per cent.
The stock was down 7 per cent at 315.25 pence at 9.57am, valuing the business at £4.77 billion.
The 125-year-old group, which is the UK's biggest clothing retailer, said it made an underlying pretax profit of £604.4 million for the year to March 28th.
M&S said it was re-basing its dividend payment to 15 pence from the 22.5 pence paid in 2007/8, a reduction of 33.3 per cent.
This would be achieved through a 33.1 per cent cut in the final dividend to 9.5 pence, followed by a reduction in the 2009/10 interim dividend to 5.5 pence.
Reuters