United Kingdom retailer M&S says to shut more than 100 stores

United Kingdom retailer M&S says to shut more than 100 stores

Marks and Spencer Group plc operates various retail stores. The stock closed down 2.9% on Tuesday.

Yesterday, M&S said it would close 100 United Kingdom stores by 2022, further accelerating the plan as it strives to make at least a third of sales online.

After taking account of adjusted items of 514.1 million pounds, including the charge relating to store closures, pretax profit was 66.8 million pounds, a 62 percent fall.

Marks & Spencer said it urgently had to modernise or risk fading away as it reported a second straight decline in annual profit and booked a £321 million charge for a store closure programme.

One-off costs came in at GBP514.1 million for the year, up from GBP437.4 million last year.

The restructuring was accelerated last past year. This is said to be a result of M&S's successful exit of loss-making owned markets and favourable currency effects.

"Closing stores isn't easy but it is vital for the future of [Marks & Spencer]".

Marks & Spencer sees profits before tax decline 5.4 percent for FY18

M&S's new chairman and CEO Steve Rowe know this has left the retailer unwieldy in its inventory.

Clothing & Home revenue fell 1.4 percent to 3,741.1 million pounds for the 52 weeks to March 31, 2018, with like-for-like revenue down 1.9 percent.

M&S said that Food's performance in key events was strong, the everyday performance was "poor". Admitting the business had become top-heavy and too "corporate", M&S has recently separated its Food and Clothing & Home teams. This was partially offset by efficiencies and lower incentive costs.

M&S left its dividend unchanged at 18.7p. Whilst the fulfilment centre at Castle Donington has struggled to cope with peak demand and some of its systems are dated. Is now well under way and the actions taken have increased the velocity of change running through our business.

The retailer said it has lost its share of younger family-age customers and larger households, and was looking to recover this with more stylish non-food lines and food products offering innovation, better value for money, and focused on more popular family foods.

Looking to the year ahead, M&S said it expects Clothing & Home gross margin to be flat to up to 50 basis points higher, "with the first half of the year adversely affected by currency and sale timing".

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