Marks and Spencer set to close 40 more stores

23 May, 2018, 17:14 | Author: Devin Moran
  • M&S profits plunge 62pc amid sweeping store closure plans

That compared with profit after taxation of 117.1 million pounds a year earlier.

"This latest wave of closures will feel like a body blow to locations that are already under pressure" says the BBC's Emma Simpson, "but the hard truth is that M&S has more stores than it needs, given our changing shopping habits" and many experts believe that closing a large swathe of stores "is a tough but necessary step".

The retailer, which had a total of 1,035 stores at the end of its 2017/2018 financial year, will publish its annual results on Wednesday.

M&S chief executive Steve Rowe said there was need for "accelerated change" at the retailer.

However, M&S improved its gross margin in the clothing and home division for the year by 50 basis points.

News of these store costs comes just a day after M&S said it will scale back its food store opening programme and will now open 15 fewer stores than planned in the year ahead.

Clothing and home revenue fell 1.4% and like-for-like sales decreased 1.9% amid a tough retail market.


In notes attached to its results, the company said the "continued migration" of clothing and home products online; the development of global competition; the growth of home delivery in food; and "the march of the discounters" all amounted to threats to its business.

"These changes come with short-term costs which are reflected in today's results".

The retailer said that this is the first phase in the campaign that will see further prices lowered in the coming months.

In addition, the group is set to close 25 percent of its Clothing & Home space to as sales shift online and investing to increase and improve its commerce capacity to support its aim to double its online sales to more than 33 percent.

M&S said its food and non-food supply chains needed "significant upgrades" to speed up service, reduce high clothing stock levels and tackle availability and waste in food.

The company also warned that its website was "too slow", adding it was lagging behind online competitors. "This is vital as we start to leverage the strength of the M&S brand and values across a family of businesses to deliver sustainable, profitable growth in three to five years".

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