Marks & Spencer is continuing to experience tough trading with the lingerie giant posting its ninth consecutive quarter of sales in decline as it relanches its womenswear offer.
While results released today show total group sales for the 26 weeks to September 28 up 3.6% to £4.92 billion on the same period last year, like for likes in the general merchandise sector of the business fell 1.5% in the six-month period and fell 1.3% in Q2.
Despite the dipping sales, Marks & Spencer chief executive Marc Bolland said that a relaunch of the store’s womenswear departments in September had delivered some "early signs of improvement" despite only being active for three weeks of the second half of its financial year.
The retailer launched new womenswear store formats and fresh women’s fashion collections in September, including new lines of lingerie. The store also launched a fresh collection of lingerie created in collaboration with model Rosie Huntington-Whitely in August to mark the one-year anniversery of the partnership.
The autumn/winter lingerie collections were previewed in May, just a few weeks after Jo Jenkins stepped into the role of director of lingerie and beauty. She replaced Janie Schaffer who left Marks & Spencer after just three months in the role.
Marks & Spencer said that its etail business had delivered a strong performance during the period with online sales up 28.5% in the second half and 27.2% in the second quarter.
Bolland admitted that Marks & Spencer still faces an uphill battle to transform the business but said that he is feeling positive about the progress already made.
He said: "We continued to invest in the long-term transformation of the business. We are pleased with the progress made, given the high level of activity and a number of key projects launching this year. This has led to a higher level of additional costs, which while planned for, have impacted short-term results.
“This year marks the final year of elevated capital investment in the business. From 2014/15 we will move to a lower, more sustainable long-term investment level of c.£550m. This, combined with the operational improvements we are making, makes us confident that we will deliver a material improvement in free cash flow from 2014/15, and we remain focused on delivering improved shareholder returns.”
Kate Calvert at analyst Investec painted a less sunny picture of trading at Marks & Spencer, describing the results as "a tale of two UK businesses" with food performing well but general merchandise suffering and "little evidence of a womenswear turnaround".
She said: "There is not much sparkle in M&S’ H1 results with PBT down 9% to £262 million. While food continues to perform, the much awaited womenswear AW13 collection is yet to deliver the hoped-for magic. Admittedly, the weather may not have helped and all-important Christmas, against weak comps, is yet to come."