M&S has reported a 14.7% jump in food sales; a 5.7% growth in clothing and home sales; and a pre-tax profit before adjusting items of £360.2mn, with its half-year results highlighting a turnaround for the high-street giant.
Stuart Machin, M&S chief executive, said: “Our strategy to reshape M&S for growth has delivered strong results in the first half. We have maintained our relentless focus on trusted value, giving our customers exceptional quality products at the best possible price.
“Looking ahead, trading momentum has been maintained through October, with customers responding positively to our Christmas ranges. There will be challenges and headwinds in the year ahead and progress won’t be linear, but we are ambitious for future growth and are driving what is in our control.
“Everyone at M&S makes change happen and I want to thank my colleagues for their contribution to these results. I also want to thank them in advance for what they are about to do. All of us will be sleeves rolled up, out in stores and distribution centres, bringing the magic of M&S alive for our customers this Christmas. In summary – we’re only just beginning. Lots done, lots to do, lots of opportunity.”
Richard Lim, CEO at Retail Economics, noted: “The retailer continues to showcase a mightily impressive turnaround of the business with these latest figures demonstrating significant improvements in sales and profitability. Their renewed product focus, investment in omnichannel and sophisticated use of data has been supercharged by a reenergised culture.
“However, the outlook remains challenging with the combination of higher interest rates, weaker economic growth and geopolitical events creating significant uncertainty.”
Neil Shah, executive director at Edison Group, said: “M&S’s comeback continues with a robust set of results. Much of this has been driven by a 14.7% increase in food sales, which has been achieved by lowering prices while maintaining levels of quality. In this regard, the company appears to be trading on its trusted reputation to pursue a market share strategy – presenting itself as the go-to retailer amidst an uncertain consumer environment.
“As well as the difficulties faced by its rival John Lewis, M&S appears to be resuming its place as the country’s premier quality retailer.“
John Choong, senior equity research analyst at Investing Reviews, commented: “M&S continues to sparkle brightly, scoring top marks with its latest interim numbers. Investors will also be glad to see operating margins improve as the retailer is beginning to reap the benefits of vertically integrating its supply chain. Its acquisition of Gist along with lower wholesale food and commodity costs led to a massive 75% growth in its adjusted pre-tax profits.
“With the opening of more stores before the holiday season and wage growth now trending above inflation, investors should be confident that the newly-inducted FTSE 100 stalwart’s strong momentum should be sufficient to enjoy a delightful Christmas and see respectable sales growth in H2.”
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