Parisians and expats flocked to the Marks & Spencer store on the Champs-Elysées when the retailer opened its first shop in France since its exit 10 years ago. Buoyed by this triumph in November, and by strong demand for its chicken tikka masala, Earl Grey tea, crumpets and quintessentially English sandwiches, M&S last month opened a second, larger, store in the city's Levallois-Perret district. A further two shops are planned for Paris next year.
However, it is not in the French capital but on the high streets of British cities such as Sheffield, Liverpool and Bristol that the financial fortunes of M&S sink or swim. And trading on this side of the Channel has been much choppier recently.
On Tuesday, the retail bell-wether is forecast to post a 13 per cent drop in profit to £280m in the half-year to September. While the wet summer and fierce discounting on the high street hit clothing sales and margins, M&S itself contributed to its problems with lacklustre fashion ranges. In particular, women criticised the colour palettes and a lack of sleeved dresses.
Neil Saunders, managing director of Conlumino, the retail consultancy, says: "Discounting has certainly taken its toll. Clothing comes across as fragmented, bitty and rather uninspiring."
Indeed, rivals John Lewis, Next and Debenhams have posted a healthy rise in either half-year or annual profit over recent weeks. John Stevenson, analyst at Peel Hunt, says: "If you look at most big retailers, such as Next and Debenhams, they are delivering profit growth. So with M&S half-profits expected to fall, the issue is self-inflicted, not macro. It is about getting back to basics on general merchandise such as on womenswear."
Such comparisons will pile the pressure on Marc Bolland, chief executive of M&S since May 2010, as he unveils his second consecutive year of falling half-year profit. The Dutchman has initiated a raft of changes to improve the bottom-| and top-line performance of the chain, which serves more than 21 million customers in more than 700 UK stores each week.
These include launching banking in its stores through a joint venture with HSBC; introducing own-language websites in Germany, Spain, Austria and Belgium; and refurbishing swathes of its UK stores estate. Under his watch, M&S has also stepped up its expansion overseas, particularly in fast-growing emerging markets.
Stevenson says: "Internationally, Marc Bolland is doing the right thing by focusing on China and India. The GDP growth that is coming through in emerging markets is still outperforming Europe."
However, the numbers support the view of Mr Saunders that M&S under Mr Bolland "feels like it has been treading water". The retailer delivered annual profits of £632m before he joined, and while the figure is forecast to be £680m this year, it remains a long way off the £1bn of 2007-08. The share price is below 400p, compared with 361p when Bolland started.
Mr Stevenson says: "Marc Bolland set out his stall with his recovery strategy in November 2010, and he now needs to deliver. This autumn and winter is an important season for him. Has he got the right ranges at the right price points in the right volumes?"
The review Bolland unveiled two years ago has not delivered the goods in terms of pure numbers. At that point, M&S, which has 390 stores overseas, vowed to increase sales by up to 25 per cent to between £11.5bn and £12.5bn by 2014. But Peel Hunt says it will only increase total sales to £10.6bn over this period.
Mr Bolland's decision in 2010 to hire Alan Stewart as finance director seems to have been an inspired one. His tight control on costs has largely compensated for recent trading weaknesses in general merchandise. M&S has guided towards cost growth of 3 per cent to 5 per cent this financial year but Peel Hunt thinks it will again be at the lower end of this range.
The Dutchman can also hold his head high regarding the performance of its food business, which accounts for about half of group revenue. In a brutally tough market that has seen Tesco issue a profit warning and underlying revenue fall at his former employer Morrisons, M&S has continued to grow in food.
The City forecasts like-for-like food sales will have grown by 1.5 per cent in the second quarter, following a 0.6 per cent rise in the previous three months.
But it is M&S's general merchandise, particularly clothing, that will define Mr Bolland's tenure. Analysts expect a 2.5 per cent fall in underlying UK sales in the second quarter. Boosted by consumers purchasing jumpers and coats during the cold snap towards the end of September, this will mark a significant improvement on the disastrous 6.8 per cent slump in the first quarter. But Mr Saunders says: "I don't think the womenswear offer has oomph."
The task of turning round its general merchandise business was handed to John Dixon, the former head of food, following Kate Bostock's resignation in July. M&S also brought in Belinda Earl, the former chief executive of Jaeger, as style director. But analysts at Barclays say the "desired brand uplifts from recent managerial appointments" in non-food will "take time".
The good news for Mr Bolland is that it appears he will be given time to turn around the M&S tanker, although a profit warning or two could quickly change the mind of investors. Nick Bubb, the independent retail analyst, says: "I suspect that autumn trading has been good. So it feels like the pressure is easing off Mr Bolland in the short term. But he will still need to drive a useful increase in 2013-14 profits to avoid a tap on his shoulder."
M&S chief executive Marc Bolland was dubbed the '$1bn man' when unveiled as chief executive in November 2009. The Dutchman and former Heineken executive is now under pressure to deliver the goods, with this year's annual profits forecast to fall by 4 per cent to £680m.
Steve Rowe, M&S's former director of retail, has nearly 25 years' experience at the retailer, and was elevated to the board in October to run the food business. His job is to keep its food operation moving in the right direction by maintaining its pipeline of new products, slick marketing and tempting pricing offers for customers in the fiercely competitive grocery market.
The poaching of Laura Wade-Gery from Tesco to head M&S's online business in July 2011 was seen as a huge coup for Marc Bolland. While M&S will remain on the web platform of Amazon until 2014, e-commerce director Ms Wade-Gery last month introduced four own-language websites to give the retailer six such sites outside the UK.
Following the poor fashion performance in its first quarter, Belinda Earl was hired as M&S style director from September to sharpen up its product offer, although she is working just "two to three days a week". She stepped down as the chief executive of Jaeger and Aquascutum – reportedly on health grounds – in January and has more than 25 years' experience in the sector.
John Dixon, the executive director of general merchandise, was in July given the critical task of turning around its faltering non-food business after the exit of Kate Bostock. An M&S lifer, he led the recovery of its food operation from 2009 and if he works similar magic on womenswear, Mr Dixon will be seen as a potential successor to Marc Bolland.
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