Marks and Spencer has recorded its first growth in general merchandise – the division heavily focused on clothing – in 14 quarters. The like for like growth of 0.7 per cent for the three months to March 28 brings to a close a two-and-a-half-year downwards spiral that has plagued chief executive Marc Bolland's tenure.
Its food arm continued to perform strongly, with sales up 3.7 per cent for the quarter. UK sales rose 2.7 per cent.
M&S' share price jumped four per cent in early trading.
Why it's interesting
Bolland has spent billions of pounds reinvesting in M&S, overseeing the redesign of products, stores, logistics and its website. He has consistently described it as a "step by step" approach, involving high profile hires like Belinda Earl as style director, under whom there has been a big push to improve style and quality.
But his efforts have come under fire for failing to stock enough of the most popular merchandise to bump up M&S's bottom line.
While like-for-like growth in GM will be welcomed, especially as it beat analyst forecasts of a 1.1 per cent decline, some will say the figure is too low in the wake of so much decline. M&S is also still underperforming the wider sector.
The results also show how M&S is changing. More than half of the group sales and around a third of the profit now depends on food.
What M&S said
We have made strong progress over the quarter. In food we delivered another excellent performance, with sales growth ahead of the market.
We continued to deliver on general merchandise gross margin, and are pleased that we have achieved this whilst also improving general merchandise sales. M&S.com has returned to growth, as planned, with further improvement in customer metrics.
M&S will be pleased to have finally shaken such a long period of decline in general merchandise.
But after spending several years in decline and only scraping over the line in this morning's trading update M&S watchers will still be looking for significant improvements in the clothing, which still makes up the bulk of the retailer's profits.