Marks & Spencer believes its lingerie segment is in a “very strong position” despite announcing its intention to accelerate its clothing store closure plans as it posted a 5.3% fall in half-year profits.
The retailer said it would speed up changes for clothing and homeware in its stores, including closures, space reduction and relocations. It also plans to open fewer Simply Food stores than previously planned.
M&S said it believes its position in clothing and home has “eroded” over the last 15 years as online retailers, new international competitors and discounters have taken market share.
However, the business retains very strong market positions in lingerie, schoolwear, denim, suits and other areas, the retailer said.
Last week, Marks & Spencer celebrated five successful years of its Rosie for Autograph lingerie brand as figures show the label has shifted 11 million items since its inception.
The retailer said the success of the collection, which launched in collaboration with supermodel Rosie Huntington-Whitley in 2012, has helped maintain its position as the UK’s market leader in lingerie, with a 35% market share in bras.
Marks & Spencer posted underlying pre-tax profits of £219.1 million for the six months to September 30, down from £231.3 million a year earlier.
But like-for-like sales improved in its clothing and home arm, down by a better-than-feared 0.1% in its second quarter, having fallen 1.2% in the previous three months.
Marks & Spencer said it expects it online share of sales to grow significantly and is aiming for one third of its clothing and home sales to be online in the medium term.
“This, and the better than expected levels of sales transfer from recent closures, means that we are accelerating our UK store rationalisation programme,” the retailer added.
Chief executive Steve Rowe said: “We have made good progress in remedying the immediate and burning issues at M&S I outlined last year. In clothing and home, early results are encouraging and in International we now have a profitable and robust business. We recognise now that we face stronger headwinds in food which will be addressed in the year ahead.
“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.”