Marks & Spencer stuns market with 58% surge in full year profit

marks-spencer
23.3.22 ©Richard Eaton 07778 395888

UK high street retail brand Marks & Spencer has smashed analyst expectations by recording a 58% rise in pretax profits to £716.4m on revenue of £13.1billion.

Rise of a new Marks & Spencer

M&S said its food sales were up 13.0% and clothing and home sales rose 5.3%, which the 140 year old company said was the result of its Reshape for Growth plan, which it launched two years ago.

The company said online sales increased 7.8%, with growth accelerating in the second half, as the effectiveness of online marketing started to improve, particularly in womenswear.

Moreover, it said the M&S App continued to grow, accounting for 44% of online orders, versus 37% a year earlier.

Online partner brand sales grew 33%, with new partners added including Adidas, Puma, and Sweaty Betty, supporting the growth of average basket value.

The only damp spot over M&S’ market beating results was from delivery joint venture Ocado, where M&S’ share of losses came in at £37m, despite revenue rising 11%.

Marks & Spencer said that “although the financial performance of Ocado Retail remains disappointing, the revenue improvement this year under the new management team has been marked”.

Stuart Machin, Chief Executive said: “Two years into our plan to Reshape for Growth we can see the beginnings of a new M&S. Food and Clothing & Home grew volume and value share ahead of the market and sales increased across stores and online.

“Both businesses have now delivered 12 consecutive quarters of sales growth and this trading momentum gives us wind in our sails, and confidence that our plan is working.

“We are becoming more relevant, to more people, more of the time.

He added: “We have a clear plan, a clear vision for the future, and there is so much opportunity ahead of us. We are at the beginnings of a new M&S.”

Marks & Spencer shares were trading 8.4% higher at £2.96 in London following its results.