M&S shares rise despite further fall in clothing

Kasmira Jefford
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MARKS & Spencer chief executive Marc Bolland said efforts put into the new autumn and winter range were showing signs of paying off, as the retailer’s decline in general merchandise sales slowed slightly, pushing shares 4.5 per cent higher yesterday.

The high street stalwart reported a 1.5 per cent decline in underlying general merchandise sales – which consists of mainly clothing – in the six months to 28 September, its ninth consecutive negative quarter.

However the decline slowed to 1.3 per cent in the second quarter, from a 1.6 per cent drop in the first quarter, helped by the new autumn-winter range, which was fully launched in stores in September.

Bolland pointed to a “gradual improvement” in womenswear sales, which he has been battling to return to positive territory.

“There have only been a few weeks since the re-launch so I am confident we will see an improvement as we go through these new collections,” he said. But he was quick to add that it would be “wrong” for the company to try and signpost where it expected sales to be after Christmas.

He said it had increased the stock of lines featured in its high profile “Leading Ladies” campaign by 50 per cent and sold 80 per cent of that stock in the first six weeks.

The half-year period only included the first three weeks after the launch of the collection and pressure will be on the group following the crucial festive period to show a pick-up in sales.

However, analysts at Cantor Fitzgerald predict that it will take “a number of seasons” before there is a marked improvement in womenswear.

M&S’s food division, which accounts for 55 per cent of the business, reported like-for-like sales up 3.2 per cent in the second quarter.

International sales grew by eight per cent at constant currency, while online sales grew by 28.5 per cent.