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Upbeat M&S eyes overseas growth | |
(4 days later) | |
Marks and Spencer has reported a strong rise in half-year profits and unveiled plans to expand in China and India. | |
M&S made an adjusted pre-tax profit of £451.8m ($942m) for the six months to 29 September, up 11.5% on last year and better than expectations. | |
Same-store sales, which exclude new store openings, were up 1.6% in the UK. | |
The retailer described the results as "good", given the poor summer weather, but it also warned that the short-term UK retail outlook remained "uncertain". | |
Overseas expansion | |
M&S said that it was now planning to enter the Chinese market, with its first store expected to open during the next financial year. | |
The actions we have taken to reposition and revitalise M&S... give us confidence in the long term growth prospects of the business Stuart Rose, Marks and Spencer chief executive Check M&S's share price | |
It also announced that it was planning to expand its presence in India, where it has traded for six years. | |
"We believe that there is a significant opportunity to grow our international business going forward and are targeting a 15-20% contribution to group revenues within the next five years," it said. | |
The retailer currently has 257 overseas stores in 36 countries. | |
'Tough market' | 'Tough market' |
The firm's total sales for the half-year came to £4.2bn, a 6.5% increase on the same period last year. | The firm's total sales for the half-year came to £4.2bn, a 6.5% increase on the same period last year. |
Overall UK sales advanced 5.9%, while those at stores abroad jumped 13.8%. | Overall UK sales advanced 5.9%, while those at stores abroad jumped 13.8%. |
UK food sales were up 0.5%, while general merchandising sales grew by 2.3%. | |
"We had a good first half despite a tough market impacted by unseasonable trading conditions, and at a time when many of our stores were undergoing major refurbishment," said M&S chief executive Stuart Rose. | "We had a good first half despite a tough market impacted by unseasonable trading conditions, and at a time when many of our stores were undergoing major refurbishment," said M&S chief executive Stuart Rose. |
"Whilst the short-term economic outlook remains uncertain, the actions we have taken to reposition and revitalise M&S over the last three years put us in a good position to continue to outperform and give us confidence in the long-term growth prospects of the business." | |
Mr Rose added that by Christmas, M&S would have modernised 70% of its retail space. | |
M&S also announced plans for a £1bn share buyback, which helped to lift its share price. | |
Its shares closed up 21p, or 3%, at 653p. | |