With no-one’s hand on the tiller, investors hoping for strategic direction when the firm reports full-year numbers tomorrow will be sorely disappointed. Full-year profit before tax will be around £640m on sales a touch over £9bn, with net debt coming in at around £2bn. These figures are pretty well-trailed; it’s next year that could offer cause for concern.
It’s unthinkable that the bellwether won’t feel the chill winds of austerity that are about to sweep through the public sector. A rise in VAT, which is widely-expected, won’t help either. Still, M&S shareholders may find some comfort from the fact that older consumers without a mortgage (core M&S customers) are less likely to be hit by public spending cuts. All their goodies – winter fuel allowance, a free bus pass etc – are protected from the chop. That’s why it’s worth holding on to these shares for now.