Marks & Spencer boss Marc Bolland today insisted things were starting to improve despite the struggling retailer posting an eighth successive quarter of falling clothing sales.
Shares tumbled 8.8p to 451p, making M&S the biggest faller in the FTSE 100, as Bolland faced investors at its AGM at Wembley Stadium.
Overall UK like-for-like sales crept up 0.3 per cent in the 13 weeks to June 29, its first-quarter. M&S was boosted by strong food sales, which rose 1.8 per cent. However, clothing and non-food sales once again fell, dropping 1.6 per cent.
M&S will launch its autumn and winter ranges on July 25 and investors have warned it will cost Bolland his job if sales are not good.
The range, which is the first under new style director and ex-Debenhams and Jaegar boss Belinda Earl, has received good reviews so far, yet shareholders say the proof will only come once half-year figures are published in November.
“Our general merchandise business showed some improvement this quarter and the food business delivered another excellent performance,” Bolland said. “Our International business also performed well and M&S.com sales were very strong. We continue to make good progress with our plans to transform M&S into an international, multi-channel retailer.”
Analysts were mixed about the latest update from the 129-year-old retailer, which can trace its roots back to Leeds Kirkgate market. Clive Black, analyst at Shore Capital, said: “We acknowledge the understandable concern on behalf of investors surrounding the ongoing underperformance of the core ladieswear category in the UK.
“The performance has been unacceptable for a sustained period and the management machinations have not been wholly constructive. As such, there is pressure on the forthcoming autumn/winter range to make progress for M&S. As we have stated before, we are encouraged by the fashion editors’ response to the new ranges, but it will be the sell-through which will be more telling to our minds.”
Although Bolland’s overall pay fell by a third last year, ahead of today’s AGM he has faced questions over a bonus of £829,000 that was two-and-a-half times up on last year.
Investors also need convincing that spending £2.3 billion on store refurbishments, logistics and IT systems as part of a three-year restructuring plan will revive M&S’s fortunes.Reuse content