Marks & Spencer swings to full-year loss, plans more store closures

Marks & Spencer says it plans to close more stores after swinging to a full-year loss as lockdowns took their toll on the business and in particular its clothing sales.

The British high street giant reported a pre-tax loss of 201.2 million pounds in the year to April 3, compared with a profit of 67.2 million pounds a year earlier.

After accounting for one-off costs, the business made a profit of 41.6 million pounds, down from a 403.1 million pound profit in the prior-year period.

It came as the retailer took a significant hit to its sales linked to on-and-off lockdowns throughout the year. Clothing and home sales dropped 31.5 percent – with an online growth of 53.9 percent partly offsetting a 56.2 percent drop in-store.

Clothing and home reported an operating loss before adjusting items of 129.4 million pounds. But the division’s performance improved in the second half as online growth made greater inroads into the store sales decline, the retailer said.

Marks & Spencer like-for-like food sales were up 1.3 percent.

Marks & Spencer eyes more closures

It comes amid a major transformation at the company, which last year saw 7,000 job cuts.

CEO Steve Rowe said in a statement: “In a year like no other we have delivered a resilient trading performance, thanks in no small part to the extraordinary efforts of our colleagues. In addition, by going further and faster in our transformation through the Never the Same Again programme, we moved beyond fixing the basics to forge a reshaped Marks & Spencer.

“With the right team in place to accelerate change in the trading businesses and build a trajectory for future growth, we now have a clear line of sight on the path to make Marks & Spencer special again. The transformation has moved to the next phase.”

Rowe said the company would be accelerating its closure of stores and aims to have 180 “well-invested full-line stores” – down from the 254 it has now.

The company said it has already closed or relocated 59 full-line stores,
16 food stores and 8 outlets, and added that “the effect of the pandemic means we can move faster”.


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