British retail giant Marks & Spencer has seen annual profits tumble by nearly two thirds and revealed sales across its under-pressure clothing arm have plunged back into reverse. Chief executive Steve Rowe admitted the group’s overhaul has “come with a cost” as he posted a 63.5% plunge in bottom line pre-tax profits to £176.4 million on a comparable 52-week basis.
Underlying pre-tax profits were 10.3% lower at £613.8 million in the year to April 17. The group said sales in its clothing business dropped 5.9% in the last three months, with falls compounded by the timing of Easter, marking an abrupt end to the revival seen in the third quarter, when sales rose by 2.3%.
M&S said the timing of its December sale also knocked fourth quarter trading which, when combined with the Easter impact, knocked around 3.8% off clothing and home sales and around 1.9% off food sales. This left like-for-like sales in its food halls 2.1% lower in the quarter. The profits plunge comes as Mr Rowe has invested heavily in slashing prices and overhauled its clothing ranges to win back customers.
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