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Marks and Spencer

SHAREHOLDERS were understandably miffed when Sir Stuart Rose announced his intention to stay on as executive chairman of Marks & Spencer. They were told that the power grab would ensure an smooth transition when Rose stood down; the succession at Britain’s favourite retailer has been anything but. New chief executive Marc Bolland has arrived, but his feet aren’t yet under the desk; finance director Ian Dyson is off; and Rose is expected to quit sooner than planned.

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.