Marks And Spencer Reports Fall In Profit

Marks And Spencer has reported a fall in underlying pre-tax profit to £297m for the first half of this year.

The chain blamed pressure on consumers' disposable incomes and volatile trading conditions - hit by bad weather - for the figure, which compares with £307m profit over the same period last year.

But sales across the 128-year-old group were up 0.9% at £4.7bn driven by strong performance in its food division and internationally.

In its UK stores, however, sales were flat in the second quarter, with a 1.6% rise in food partially offsetting a 1.8% fall in general merchandise sales.

It follows a 6.8% slump in general merchandise sales in the first quarter as a result of the wet summer weather and problems with stock availability.

The group's chief executive, Marc Bolland, said it had taken steps to address these issues, "and as a result, we delivered an improved performance".

"We are pleased to report a better performance across the business in the second quarter," he said.

"As we approach the all-important Christmas period, we have better than ever Christmas products, to help our customers enjoy a special Christmas at home."

Eighteen months ago, Marks and Spencer launched a plan to transform itself into an "international multi-channel retailer" by boosting its website and making it easier to buy products on smartphones and tablets.

Mr Bolland said this strategy was making "strong progress", with growth across its multi-channel business.

Retail analysts Conlumino described the results as a "mixed bag".

"While the overall half year numbers look anaemic, there has been a material uplift in fortunes since the first quarter," managing director Neil Saunders said.

"It remains too early to call whether M&S is back on the path to sustainable growth.

"M&S has still underperformed the market in fashion and growth in general merchandise remains elusive on a like-for-like basis.

"All of this points to the fact that M&S still has plenty of issues to resolve and there is still much work to be done."

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