7th Apr 2016 06:20
LONDON (Alliance News) - Marks & Spencer Group PLC on Thursday reported growth in sales in the fourth quarter of its financial year, as a rise in food sales offset a decline in general merchandise.
The FTSE 100 food, clothing and homewares retailer said group sales in the 13 weeks ended March 26 were up 1.9% on the same period the year before. The food division achieved sales growth of 4.0% while the struggling general merchandise business saw sales fall by 1.9%, although this decline was slower than in the previous quarter.
On a like-for-like basis, food sales were flat and general merchandise sales were down 2.7%.
M&S did say though that gross margin in the general merchandise business was significantly improved in the quarter, and that it now expects gross margin for that division to improve by between 240 and 250 basis points in the full year.
Meanwhile, the online business performed well, with sales up by 8.2%, and the international business achieved sales growth of 3.8%.
M&S added, however, that currency pressures and challenging trading conditions are expected to "heavily impact" full-year profitability in the international business.
"We had a mixed performance in the final quarter of the year. Our Food business once again outperformed the market by around 3.5 percentage points. Although the sales decline in Clothing and Home was lower than last quarter, our performance remains unsatisfactory and there is still more we need to do," Chief Executive Steve Rowe said in a statement.
"Turning around our Clothing and Home business by improving our customer offer is our number one priority. I will update you on my thoughts on the business in May," added Rowe, who started in his position on Saturday, replacing Marc Bolland.
M&S will publish its full annual results on May 25.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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