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| Marks and Spencer profits fall as clothing disappoints | Marks and Spencer profits fall as clothing disappoints |
| (35 minutes later) | |
| Marks and Spencer has reported a big fall in profits, despite rising sales across the group. | Marks and Spencer has reported a big fall in profits, despite rising sales across the group. |
| Pre-tax profits fell to £564.3m, down from £658m last year, despite group sales rising 1.3% to £10bn for the year to 30 March. | Pre-tax profits fell to £564.3m, down from £658m last year, despite group sales rising 1.3% to £10bn for the year to 30 March. |
| While underlying sales of food rose 1.7%, sales of general merchandise - which includes clothing - fell 4.1% in the year. | While underlying sales of food rose 1.7%, sales of general merchandise - which includes clothing - fell 4.1% in the year. |
| Chief executive Marc Bolland described the market as "challenging". | Chief executive Marc Bolland described the market as "challenging". |
| M&S's clothing division, which has an 11% market share in the UK, has been struggling in recent years as sales have fallen. | M&S's clothing division, which has an 11% market share in the UK, has been struggling in recent years as sales have fallen. |
| In April, director of lingerie and beauty Janie Schaffer, who joined M&S from lingerie chain Victoria's Secret, left after just three months in the job. | In April, director of lingerie and beauty Janie Schaffer, who joined M&S from lingerie chain Victoria's Secret, left after just three months in the job. |
| In an effort to address its problems, M&S last year changed its retail team, bringing in Belinda Earl, a former chief executive of both Debenhams and Jaeger, as head of style. Last week it launched a new autumn/winter clothing collection, which it hopes will win back disaffected customers. | |
| 'Improve quality' | 'Improve quality' |
| Speaking to BBC Radio 4's Today programme, Mr Bolland said: "We won't duck the fact that we feel we have underperformed in general merchandise. | Speaking to BBC Radio 4's Today programme, Mr Bolland said: "We won't duck the fact that we feel we have underperformed in general merchandise. |
| "We have to improve on quality", he added. | "We have to improve on quality", he added. |
| Mr Bolland also defended the company's tax affairs in the wake of controversy over tax avoidance schemes. | Mr Bolland also defended the company's tax affairs in the wake of controversy over tax avoidance schemes. |
| There was "nothing fiscal" in the company's use of Ireland as a trading hub for its international e-commerce business, he said, as the country now handles more than 50% of online trade. | There was "nothing fiscal" in the company's use of Ireland as a trading hub for its international e-commerce business, he said, as the country now handles more than 50% of online trade. |
| "M&S pays UK corporation tax on all the profits generated by UK sales", he said. "We contributed £800m to the UK tax authorities in 2011-12 - the 25th highest tax contributor in the UK." | "M&S pays UK corporation tax on all the profits generated by UK sales", he said. "We contributed £800m to the UK tax authorities in 2011-12 - the 25th highest tax contributor in the UK." |
| He maintained that M&S paid more corporation tax than many other FTSE 100 companies of bigger size. | He maintained that M&S paid more corporation tax than many other FTSE 100 companies of bigger size. |
| The company also said it had appointed Patrick Bousquet-Chavanne - currently M&S's corporate director of strategy implementation and business development - as its new marketing director. He will succeed Steven Sharp in July. | The company also said it had appointed Patrick Bousquet-Chavanne - currently M&S's corporate director of strategy implementation and business development - as its new marketing director. He will succeed Steven Sharp in July. |
| M&S said Mr Sharp had "played a significant role in shaping the M&S brand from the introduction of the 'Your M&S' branding in 2004 to numerous iconic advertising campaigns reinforcing M&S's quality, style and ethical credentials". | M&S said Mr Sharp had "played a significant role in shaping the M&S brand from the introduction of the 'Your M&S' branding in 2004 to numerous iconic advertising campaigns reinforcing M&S's quality, style and ethical credentials". |
| 'Too risk averse' | 'Too risk averse' |
| M&S said that its international sales had risen by 4.5% over the past year. | M&S said that its international sales had risen by 4.5% over the past year. |
| Multi-channel sales, which include internet shopping, rose by 16.6% and now account for 13% of general merchandise sales. | Multi-channel sales, which include internet shopping, rose by 16.6% and now account for 13% of general merchandise sales. |
| About 3.6 million people visit the website each week, the company said, while in-store pick-up of online orders was proving increasingly popular. | About 3.6 million people visit the website each week, the company said, while in-store pick-up of online orders was proving increasingly popular. |
| Retail analysts Conlumino said that although international and online sales were growing, M&S needed to "focus firmly" on its UK business. | Retail analysts Conlumino said that although international and online sales were growing, M&S needed to "focus firmly" on its UK business. |
| "On this 'home front' advancement is a little less encouraging and, in clothing at least, has seemed more like a gentle evolution than a radical reinvention," Conlumino said. | "On this 'home front' advancement is a little less encouraging and, in clothing at least, has seemed more like a gentle evolution than a radical reinvention," Conlumino said. |
| "We still believe M&S is nowhere near ambitious enough on the general merchandise front; in our view the company is too risk averse and is unwilling to break the mould of its traditional ways of doing business." | "We still believe M&S is nowhere near ambitious enough on the general merchandise front; in our view the company is too risk averse and is unwilling to break the mould of its traditional ways of doing business." |