M&S bounces back after finding the secret of high street success

Marks & Spencer has announced a remarkable turnaround in its fortunes and a huge spike in profits, writes James Moore. It’s benefitting from revamped stores and smarter online strategy – but that doesn’t mean there won’t be more pain to come

Marks & Spencer has reported bumper profits (PA)

M&S the toast of the City? You’d have been laughed out of town for predicting that just a few short years ago. But this business has been one of the more remarkable turnaround stories of recent years and all achieved against brutally tough trading conditions.

Back in the FTSE 100 after a four-year absence, the half-year results smashed the City’s forecasts with a 36 per cent rise in statutory pre tax profit to £325.6m. If you prefer the company’s “adjusted” numbers that becomes a 75 per cent rise and £360.2m in profit.

The company might have cause to regret putting such a flattering figure out into the world. Russ Mould, from broker AJ Bell, opined that the results were “so good that management’s biggest challenge now may be to stop analysts getting over-excited and prevent them from upgrading their numbers too much and setting too high a bar of expectations”.