M&S records first annual profit growth in 4 years

High street giant Marks & Spencer has recorded its first rise in full-year profits in four years.

The retailer announced a rise of 6.1% in underlying profits to £661.2m in the 52 weeks to March 28.

The boost was largely thanks to its food division after sales in general merchandise fell by 3.1% from last year, but womenswear and lingerie returned to growth in the final quarter, helped by Rosie Huntington-Whitely fronting the Autograph range.

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Marks & Spencer chief executive Marc Bolland said: “We made good progress in three of our four key priorities for the year. In Food, we had an outstanding year in a difficult market. In GM, we significantly increased the gross margin, and, while sales performance was below our expectations, we returned to growth in the fourth quarter.

"We continued to control costs and capital expenditure tightly, resulting in significantly improved free cash flow. We are transforming M&S into a stronger, more agile business – putting the right infrastructure, capabilities and talent in place to drive our strategic priorities.”

Looking ahead, the retailer said it sees a “significant gross margin improvement opportunity”, with modest sales growth in general merchandise, which includes womenswear and lingerie.

In a statement, Planet Retail said it remains “cautious” about sustained recovery in womenswear, but added that M&S appears to be “finally providing its core 55+ shoppers the style, quality and price points they demand”.

“Equally important is the fact that recent supply chain enhancements have enabled M&S to improve stock availability, quickly replenishing those top-selling items,” said Natalie Berg, director of Retail Insights at the firm.

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