Marks & Spencer sales ahead of expectations
Within UK sales, General Merchandise rose 10.6% (Clothing 10.1%; Home 13.3%) and Food was up 2.6%. On a like for like basis General Merchandise rose 9.1% and Food 1.8%.M&S Direct sales were 48% higher and International sales fell 5.9%.
In Food, there was a sixth consecutive quarter of improved performance, as better value, availability and product innovation continued to drive improved like-for-like sales. International sales were down 5.9%, as a result of particularly difficult trading conditions in the Republic of Ireland and Greece, and an adverse impact from currency translation.
M&S said it expects profit before tax for 52 weeks of 2009/10 (to 27th March 2010) to be in the range of £620m to £630m. The 53rd week (to 3rd April 2010) is expected to contribute an additional c.£60m of profit before tax. These figures reflect gross margin better than the guidance of -50 to -100 bps, and operating costs at the top end of the 0 to +1% range.
Sir Stuart Rose, Chairman said: "These are strong quarterly results by any measure. They demonstrate the appeal of the M&S brand to our 21 million weekly customers and its resilience in these difficult times. The continuing improvement in our performance is the result of the actions we have taken to invest in our stores, service, product and values. In clothing we have seen a substantial increase in market share and in food we have had six consecutive quarters of improving like-for-like performance.
"We have weathered the immediate impact of the recession but remain cautious about the outlook for 2010/11 given the current challenging environment. We hope that after the election there will be greater clarity on economic policy and how this will impact our customers individually. With this will come improving consumer confidence which is so important for our business and the economy as a whole."
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