M&S to close 14 Clothing & Home stores by 2019

23 May, 2018, 18:26 | Author: Gregory Stephens
  • Marks & Spencer to shut 100 stores by 2022 amid online push

Total UK sales grew 1.8 percent to 9,611.0 million pounds as UK costs were up 1.8 percent during the year due to costs of new space, inflation and channel shift offset by efficiencies and lower incentive costs. It is now worth less than both online grocer Ocado (OCDO.L) and online fashion website ASOS (ASOS.L), starkly illustrating how shopping habits have changed in only a decade.

Figures for the period to the end of March this year show pre-tax profits fell from £176.4 million to £66.8 million with the company shouldering exceptional costs of £514 million - a large chunk of which was the closure costs.

"We have been clear about our plans to accelerate our store closure program and the action we must take to build a business with sustainable, profitable growth", an M&S spokesperson said.

"For investors a dividend yield of over 6% is an attractive stopgap, but at the moment Steve Rowe's promise to make M&S special again requires a leap of faith", said Laith Khalaf, senior analyst at Hargreaves Lansdown.

"These changes come with short term costs which are reflected in today's results".

Its full year results for the year ended March 31st, 2018, group revenue was up marginally to £10.7 billion, but profit after tax fell 74.8 per cent to £29.1 million from £115.7million.

However, shares in M&S were up 4.5% at 304.90 pence on Wednesday, having hit a high of 311.00p earlier in the session.


M&S shares have fallen 26 percent over the previous year and it risks being booted out of the FTSE 100 index as it is now worth less than both online grocer Ocado and online fashion website ASOS, starkly illustrating how shopping habits have changed in only a decade. Whilst the fulfilment centre at Castle Donington has struggled to cope with peak demand and some of its systems are dated.

"There are a number of structural issues to address and we are taking steps towards fixing these", added Rowe.

Shares in M&S have fallen 26% over the past year and the firm is in danger of being booted out of the FTSE 100 index.

M&S admitted its clothing and home division was failing to attract younger customers and families.

M&S has launched a series of turnaround plans since the financial crisis - with clothing and home consistently dragging.

Looking to the year ahead, M&S said it expects Clothing & Home gross margin to be flat to up to 50 basis points higher, "with the first half of the year adversely affected by currency and sale timing".

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