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M&S sales continue to fall

Marks & Spencer’s clothing and home sales continued to drop in the six months to 29 September, down 2.7% on 2017, following store closures.

Like-for-like sales of clothing and home were down 1.1%. The business said online clothing sales were “ahead of the market”, but gross margin for the department was down 20 basis points as a result of the timing of its Sale.

Group revenue fell 3.1% on 2017 to £4.9bn.

Profit before tax and adjusting items was up 2% to £223.5m.

Adjusting items totalled £96.8m, including £47.6m for the UK store closure programme, which comprised 100 closures.

Food revenue was down 0.2% and like-for-like food revenue dropped 2.9% for the period, following “tough trading, fewer promotions and the timing of Easter.”

The business has targeted at least £350m of further cost savings.

Steve Rowe, chief executive, said: “Against the background of profound structural change in our industry, we are leaving no stone unturned and reshaping our business, its organisation and culture.

“This phase is about rebuilding the foundations of the future M&S and we are judging progress as much by the pace of change as the trading outcomes. Already, we have reorganised into a family of strong businesses in the biggest change to our structure for decades. We now have a largely new, very determined and energetic management team in place. M&S is becoming a faster, more commercial and more digital business.

“We are on track to restructure our store portfolio with over 100 full-line closures and expect to see newly remodelled stores open next year. We are fixing the basics of our online channel and there are very early signs of improvement. Every aspect of our ranges, how we trade, our supply chain and marketing is undergoing scrutiny and change.”

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