- M&S “accelerating our plans to build a business with sustainable, profitable growth, making M&S special again.”
- Half-year results show revenue up 2.3% but profits slipping 5%.
- CFO Helen Weir leaving.
LONDON — Marks & Spencer CEO Steve Rowe said on Wednesday that he is accelerating the pace of his turnaround plan as figures show steady revenue but slipping profits.
Rowe said in a statement on Wednesday: “The business still has many structural issues to tackle as we embark on the next five years of our transformation, in the context of a very challenging retail and consumer environment. Today we are accelerating our plans to build a business with sustainable, profitable growth, making M&S special again.”
Marks & Spencer has been underperforming the market and rivals for at least a decade and Rowe, an M&S veteran, was appointed CEO in April 2016 with the brief of turning around the business. He has been reducing discounting, closing underperforming stores, and rolling out more food stores, one of the better performing areas of M&S.
Rowe said M&S has made “good progress in remedying the immediate and burning issues.” Half-year results, published on Wednesday, show:
- Revenue up 2.6% to £5.1 billion
- Profit before adjusted items down 5.3% to £219.1 million
- Profit after tax and adjusted items up 432% to £84.6 million.
M&S said on Wednesday it will “accelerate our UK Clothing & Home space rationalisation plan” and told investors to expect floor space in this area to shrink by 1.5% next year, suggesting more M&S stores could close.
The department store also said it is slowing the rollout of more standalone food stores as “headwinds… have intensified as competitors have encroached on some of our space with the rapid growth of convenience.”
M&S said it will “reposition our food offer for future growth.” The business has recently moved into the online grocery market.
Separately on Wednesday, M&S announced that CFO Helen Weir is leaving to “pursue a plural career.” Weir has been at M&S since 2015 and will remain in the role until a replacement can be found.