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Marks & Spencer to post first dip in profits for three years

Marks & Spencer is expected to post its first dip in pre-tax profits for three years when it reveals its full-year results tomorrow.

The retailer, which has more than 700 stores globally, will post pre-tax profits of £694m, down 3% on last year.

General merchandise, including clothing and womenswear, is expected to have taken a hit, having come under pressure from Next, Tesco and Primark.

Marks & Spencer chief executive Marc Bolland is expected to admit his plan to add £3bn of sales in three years was too ambitious. Bolland aim to increase sales from £9.7bn in April 2011 to £11.5bn-£12.5bn in 2014 - revealed in his first presentation as chief executive 18 months ago - is unlikely to be met.

Last month, Marks & Spencer was hit by a shortage of top fashion lines that undermined general merchandise sales in the fourth quarter. The retailer said that menswear, lingerie and kidswear all performed strongly but womenswear was “mixed”, preforming less well in areas where it was short of stock in a number of best-selling lines.

For the 13 weeks to March 31, general merchandise, including clothing, on a like-for-like basis was down 2.8% - a worse performance than had been expected. Group sales rose 0.8% in the quarter. Total UK sales climbed 1.2% led by food, which was ahead 3.1%. Total UK general merchandise sales slipped 1.2%. Clothing was down 0.3%.

Readers' comments (1)

  • M&S needs to go more upmarket, because if it does not, it will get year on year decline with its very aging customer base. It should be best of British, instead of the futile attempt to compete with Next and even Tesco and Primark. It needs to get rid of its stuffiness, get some new blood to give the business an overhaul because if ever there was a business that needed a huge kick up the arse of the last few years, it's M&S.

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