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| Version 7 | Version 8 |
|---|---|
| M&S sees profits increase to £1bn | M&S sees profits increase to £1bn |
| (about 6 hours later) | |
| Marks and Spencer has reported a 4.3% rise in annual profits to £1bn, but says it is cautious about its prospects for the next 12 months. | Marks and Spencer has reported a 4.3% rise in annual profits to £1bn, but says it is cautious about its prospects for the next 12 months. |
| The retailer said like-for-like sales in the UK slipped in both food and clothing in the year to 29 March. | The retailer said like-for-like sales in the UK slipped in both food and clothing in the year to 29 March. |
| It described trading in the first seven weeks of the new financial year as "mixed", with April being "difficult". | It described trading in the first seven weeks of the new financial year as "mixed", with April being "difficult". |
| M&S announced a big cut in bonuses for staff, after missing targets, but its store teams are set to share £12.8m. | M&S announced a big cut in bonuses for staff, after missing targets, but its store teams are set to share £12.8m. |
| Last year it paid out a record £91m in bonuses to its 75,000 staff. | Last year it paid out a record £91m in bonuses to its 75,000 staff. |
| M&S Chief Executive Stuart Rose answers your questions | M&S Chief Executive Stuart Rose answers your questions |
| The M&S profit is the largest at the firm since 1997/98. | The M&S profit is the largest at the firm since 1997/98. |
| But chief executive Stuart Rose told the BBC: "We did not do quite as well as we would have liked." | But chief executive Stuart Rose told the BBC: "We did not do quite as well as we would have liked." |
| And analysts are predicting that profits in excess of £1bn will not be repeated this year as the store is hit by the consumer slowdown. | And analysts are predicting that profits in excess of £1bn will not be repeated this year as the store is hit by the consumer slowdown. |
| "Whilst headline numbers will no doubt be taken positively, this set of results is delaying the inevitable," said Collins Stewart analyst, Rob Mann. | "Whilst headline numbers will no doubt be taken positively, this set of results is delaying the inevitable," said Collins Stewart analyst, Rob Mann. |
| "Margins are on the slide and it is not just a function of greater contribution from food. Cost inflation is heavy and gross margins are under increasing pressure," Mr Mann added. | "Margins are on the slide and it is not just a function of greater contribution from food. Cost inflation is heavy and gross margins are under increasing pressure," Mr Mann added. |
| The retailer's shares finished down 21 pence, or 5%, at 396p. | |
| Expansion | Expansion |
| The firm was "well positioned" to compete in the challenging retail environment being experienced in the UK, Sir Stuart said. | The firm was "well positioned" to compete in the challenging retail environment being experienced in the UK, Sir Stuart said. |
| "We expect market conditions to remain difficult for the foreseeable future and are managing our business accordingly," he said. | "We expect market conditions to remain difficult for the foreseeable future and are managing our business accordingly," he said. |
| "Tight stock control and management of costs are a priority." | "Tight stock control and management of costs are a priority." |
| Overall sales were 5.1% higher at £9bn | Overall sales were 5.1% higher at £9bn |
| But the results included a 1.7% fall in like-for-like sales during the final three months of the year - the second successive quarter of falling sales after a disappointing Christmas. | But the results included a 1.7% fall in like-for-like sales during the final three months of the year - the second successive quarter of falling sales after a disappointing Christmas. |
| For the year as a whole, UK like-for-like sales fell 0.5%, with sales of general merchandise - which includes clothes - down 0.5% and food sales 0.4% lower. | For the year as a whole, UK like-for-like sales fell 0.5%, with sales of general merchandise - which includes clothes - down 0.5% and food sales 0.4% lower. |
| M&S will be hoping to underpin any weakness in the UK environment with geographical diversification Richard Hunter,Hargreaves Lansdown Stockbrokers | M&S will be hoping to underpin any weakness in the UK environment with geographical diversification Richard Hunter,Hargreaves Lansdown Stockbrokers |
| New stores and expansions helped M&S increased its shop floor space in the UK by 4.8% during the year, and it forecast growth of 5.5% in the current financial year. | New stores and expansions helped M&S increased its shop floor space in the UK by 4.8% during the year, and it forecast growth of 5.5% in the current financial year. |
| 'Better job' | 'Better job' |
| Looking further afield, international sales were up by 16.8% to £712.9m, while operating profits grew 33% to £116.4m. | Looking further afield, international sales were up by 16.8% to £712.9m, while operating profits grew 33% to £116.4m. |
| "With more space being added in Europe and India, and with a Shanghai store on the horizon, M&S will be hoping to underpin any weakness in the UK environment with this geographical diversification," said Richard Hunter of Hargreaves Lansdown Stockbrokers. | "With more space being added in Europe and India, and with a Shanghai store on the horizon, M&S will be hoping to underpin any weakness in the UK environment with this geographical diversification," said Richard Hunter of Hargreaves Lansdown Stockbrokers. |
| He added that an increase in the firm's dividend payout showed "a level of management confidence in the business which is not necessarily echoed by their outlook". | He added that an increase in the firm's dividend payout showed "a level of management confidence in the business which is not necessarily echoed by their outlook". |
| M&S investors have been upset by Sir Stuart's decision to promote himself to combine the roles of chief executive and chairman - which goes against City recommendations on corporate governance practice. | M&S investors have been upset by Sir Stuart's decision to promote himself to combine the roles of chief executive and chairman - which goes against City recommendations on corporate governance practice. |
| Sir Stuart has conceded the firm could have "done a better job of explaining" the decision. | Sir Stuart has conceded the firm could have "done a better job of explaining" the decision. |
| Earlier this month, M&S rolled out a programme to charge 5p for single use food carrier bags. | Earlier this month, M&S rolled out a programme to charge 5p for single use food carrier bags. |