- Advertisement -

M&S sales plunge over “challenging” Christmas

Marks & Spencer (M&S) saw sales fall 8.2% in the three months to 26 December.

In what would normally be a stronger season, clothing sales dropped 25.1% to £787m. In November alone, the group saw clothing sales plunge 40%.

The M&S food court saw a better performance with sales up 2.2% to £1.7bn. International sales suffered and were down overall by 10.4%.

Steve Rowe, Chief Executive said: “Given the on-off restrictions and distortions in demand patterns our trading was robust over the Christmas period. More importantly beneath the Covid clouds we saw a very strong performance from the Food business including Ocado Retail and a further acceleration of Clothing & Home online.  I want to thank all my colleagues for a first-class execution of Christmas for our customers in near impossible conditions. 

“Near term trading remains very challenging but we are continuing to accelerate change under our Never the Same Again programme to ensure the business emerges from the pandemic in very different shape,” he added.

M&S has said that it has been impacted by Brexit and now faces potential tariffs from goods coming from the EU.

Ross Hindle, a retail sector analyst at Third Bridge, commented: “Marks & Spencer saw positive growth in food sales of 2.6%. However the growth is not enough to is offset their fashion-division declines with total sales for the Group down 8.4% for the quarter.”

“M&S’s potential acquisition of Jaeger hints at the potential for a more aggressive shift into the multi-brand space. M&S have numerous large stores which could be filled with non-M&S merchandise in order to drive their top-line. The risk here is whether such brands might cannibalise M&S branded products.”

Despite the pressure faced by their clothing division, the M&S food division is expected to deliver solid results, propelled by both stock-piling and its Ocado partnership. Ocado has outperformed throughout the pandemic gaining 20 basis points in market share, however capacity issues continue to limit the Group’s growth potential.” 

Shares in M&S are currently trading -2.20% at 138.24 (0943GMT). In the year-to-date, shares have fallen from highs of 209.53.

Register for our free newsletter

Related Articles