M&S shuts more branches as profits fall

MArKS & Spencer is stepping up the number and speed of store closures amid another fall in profits and sales.

The company said the number of older stores which will be closed as part of a transformation programme has been increased from 110 to 120.

Some 35 have already put up the shutters and another 85 are due to go dark over the next 12 to 18 months. M&S also plans to open 75 larger specialist food stores while closing 25 of its smallest Simply Food outlets. The moves are designed to reflect a switch to shopping for clothes and home products online rather than using stores.

The company is keen to concentrate on building up its grocery sales, which equate to more than half of all takings, ahead of a home delivery distribution partnership with Ocado. The store closure details came as M&S posted underlying pre-tax profits of £523.2million for the year to March 30, which was down 9.9 per cent from £580.9million the previous year. Shares fell 5 per cent as the results confirmed a hefty cut to its shareholder dividend payout, down 25.7 per cent to 13.9p a share.

Chief executive Steve rowe said ‘substantial changes across the business to our processes’ had ‘constrained this year’s performance’. He added: ‘We remain on track with our transformation and are now well on the road to making M&S special again.’