M&S profits nosedive... but outlook better for Northern Ireland with plan for new stores
Marks & Spencer has unveiled another year of falling profits as the high street giant counts the cost of its transformation programme.
The retailer, which has 20 stores in Northern Ireland, reported a 62.1% fall in pre-tax profit to £66.8m in the year to March 31 as it was dragged down by £321.1m in costs linked to a store closure programme.
Chief executive Steve Rowe said: "At our half-year, results in November 1 outlined the need for accelerated change at M&S.
"The first phase of our transformation plan, restoring the basics, is now well under way and the actions taken have increased the velocity of change running through our business.
"These changes come with short-term costs which are reflected in today's results," he added.
The retailer's troubled clothing arm saw like-for-like sales fall by 1.9% in the year. Comparable food sales were down 0.3%. Revenue nudged up 0.7% to £10.7bn.
On an adjusted basis, with costs stripped out, pre-tax profit fell 5.4% to £580.9m.
"There are a number of structural issues to address and we are taking steps towards fixing these," Mr Rowe said.
"The new organisation will largely be in place by July and the team is now tackling transforming our culture to make M&S a faster, lower cost, more commercial, more digital business.
"This is vital as we start to leverage the strength of the M&S brand and values across a family of businesses to deliver sustainable, profitable growth in three to five years."
The results came one day after M&S said it is to close more than 100 stores by 2022 as it accelerates a transformation programme that will see thousands of jobs put at risk.
The closures will affect its clothing and home stores, which have underperformed for years.
M&S named 14 stores earmarked for closure, including in London's Bayswater and Holloway Road, with a total of 872 employees affected.
However, the story is completely different in Northern Ireland where it is on course to open two new stores.
A Carrickfergus M&S food unit is set to open adjacent to the Clarion Hotel in spring 2019, while a new foodhall will also open in Craigavon's Marlborough Retail Park later this year.
The chain has also announced a new head of region for Northern Ireland.
Simon Layton has been with the chain for over 15 years and was previously head of region for the North West Midlands.