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Marks & Spencer "pleased" to report improved performance

Marks & Spencer has reported an improved performance in general merchandise in the second quarter of its financial year although like-for-like sales remain down. 

Reporting its sales performance for the 13 weeks to September 29, 2012 the retailer said sales of general merchandise, which include clothing, crept up by 0.1% during the second quarter although like-for-like sales compared to the same quarter the previous year were down by 1.8%.

However, a well-documented poor performance in general merchandise in the first quarter of this year means that M&S’s sales in this area for the first 26 weeks of its financial year were down by 2.5% compared to the same period the previous year, while like-for-like sales were down 4.3%.

M&S chief executive Marc Bolland said that he was “pleased” to be reporting a better performance across the business.

“We took steps to address the short term merchandising issues in general merchandise and as a result we delivered an improved performance,” he added.

Back in July when M&S reported its first quarter performance, sales of general merchandise had dropped 5.1% in the quarter while like-for-likes fell back 6.8%.

“At the start of the financial year we identified merchandising issues in our spring/summer clothing collections, which impacted performance in our first quarter,” Bolland continued. 

“We took decisive action bringing our stock levels back in line for the autumn/winter season, improving our merchandising process and better aligning our buying and external marketing.”

Overall M&S’s group sales were up 0.9% in the first half to £4.7bn, with profit before tax standing at £297m, down on the same half the previous year when the reported profit before tax was £315m.

The retailer said performance in its multi channel and international business continued to be strong with multi channel sales up 21.6% in the second quarter and 17.8% in the first half.

International sales were up 6.1% in the second quarter and 3.6% in the first half.

“Eighteen months in we are making strong progress with our plan to turn M&S into an international multi channel retailer,” said Bolland.

“Our new international stores are performing well, and our multi channel business is delivering strong growth.”

The retailer said it remained “cautious” about the outlook for the rest of the year as recent trading has been volatile and pressures on consumer spending continue. 

Yesterday M&S announced two new key appointments to its senior management team in general merchandise, adding to the appointments already made in July and September of this year. 

Francis Russell was appointed trading director in womneswear, promoted from her previous role as lingerie and beauty director while Janie Schaffer will join from Victoria’s Secret in early 2013 to replace Russell as lingerie and beauty director.

Russell and Schaffer join John Dixon who was announced as executive director of general merchandise in July, Belinda Earl who took on the role of style director in September and Scott Fyfe who takes on the position of menswear director in December.

“The new team is now in place and focused on delivering improvements for our customers in both product and operational execution,” said Bolland.

Marks and Spencer will update its third quarter sales on 10 January, 2013.

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