M&S in 64% profit crash
One-off costs blamed for plunge
CRITICS warned Marks & Spencer was “out of excuses” after posting a 64% plunge in profits.
The high street giant blamed £437million of supposed one-off costs for the slump.
They included £127m for axing its final salary pension scheme, £23m to up base pay to £8.50 an hour, £47m to close 10 stores and £132m through a shake-up of its overseas arm.
It led to profits crashing to £176m in the year to April.
Excluding one-offs, they fell 10.3% to £614m – a long way from its £1bn heyday in 2008.
Steve Rowe, M&S chief executive, insisted the firm’s recovery plan was on track, saying: “We have achieved a huge amount.”
The chain said the number of clothing and homewares product lines had been cut by 10%, prices on 2,400 items were reduced by around 18% and discounting slashed.
Sales of 100 top clothing lines – including skinny jeans and white T-shirts – rose 7% and its bra market share hit a record 34.9%, boosted by a range from Hollywood star Rosie Huntington-Whiteley.
Clothing and home – 40% of M&S sales – tumbled 5.9% in the three months to April, blamed in part on the timing of Easter. Food sales fell 1.9% last year, and 3.6% in the final three months.
John Ibbotson, analyst at Retail Vision, said: “M&S has run out of excuses. These results are nothing less than awful.”