Marks & Spencer steps up ‘digital first’ overhaul
Marks & Spencer is to accelerate its store closure plan as it moves to become a ‘digital first’ retailer.
It made the announcement on the back of a 5.3% fall in half-year profits. M&S posted underlying pre-tax profits of £219.1 million for the six months to 30th September, down from £231.3 million a year earlier. In 2016, it said it would add 200 new food stores by the end of 2019, whilst one in four of its 300 clothing stores would shut down, move or be remodelled to remove excess space. The retailer will now accelerate the closure initiative and put the brakes on opening plans for its food-only stores, although it still aims to launch another 80 Simply Food shops over the full year. M&S stressed that any job losses would be minimal, with staff being redeployed. At the same time, it has set a target for a third of its clothing and homeware sales to be made online and plans to “substantially” reduce its cost base.
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 & 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."
Meanwhile, Chief Financial Officer Helen Weir is to leave the business as soon as a replacement is found. Weir, who joined from John Lewis in 2014, had “informed the Board of her desire to pursue a plural career”.