Home news M&S slows its food store expansion plan

M&S slows its food store expansion plan


Marks and Spencer will open fewer Simply Food shops than expected after same store foods sales fell in the first six months of its financial year.Chief executive Steve Rowe said last year the retailer would open 200 Simply Food shops over the next five years.However, M&S said it would “reposition our food business including slowing our Simply Food store opening plan”.Like-for-like food sales, which exclude new store sales fell 0.1%, with Marks saying it faced “stronger headwinds”. However, total food sales for the period rose 4.4% driven by new store openings. M&S said that “hard-pressed” consumers were more aware of value and were being “careful about premium choices”. It added that “headwinds facing our food business have intensified as competitors have encroached on some of our space with the rapid growth of convenience.”For the group overall total sales rose by 2.6% to £5.1bn, but pre-tax profit fell by 5.3% to £219.1m.Like-for-like sales in clothing and homeware fell 0.7%, while total same-store sales fell by 0.3%.Commenting on the M&S’s performance in food, Patrick O’Brien, UK research director at GlobalData Retail, said: “When you compare that to the likes of Tesco, Sainsbury’s and Morrisons, whose recent like-for-likes have been around 2% plus, that’s a pretty bad performance.”He said that food had been “a banker” for M&S in the past. “For it to be losing ground at a time of inflation is really quite damaging,” he said.Mr Rowe said: “We have made good progress in remedying the immediate and burning issues at M&S I outlined last year. “In clothing and home, early results are encouraging, and in International we now have a profitable and robust business.”We recognise now that we face stronger headwinds in food, which will be addressed in the year ahead.”M&S also announced that its chief financial officer, Helen Weir, will step down. She will stay on until a successor is found.
Source: BBC News