Shares in Marks & Spencer closed more than 14 per cent higher yesterday after the embattled retailer issued a surprise profit upgrade, its first since the start of this century, writes Kristy Dorsey.
In an unscheduled trading update, the company noted that clothing and home sales rebounded to just below pre-pandemic levels during the 19 weeks to August 14. However, this was driven by a 62 per cent increase in online purchases, whereas sales in its stores are still almost 20% lower than in 2019.
Revenue across its clothing and home division rose by 92% during the period as the relaxation of coronavirus restrictions that shut down much of its estate during the past 18 months have eased. Compared to 2019, sales were down 2.6%.
Its food division also put in a strong performance, with sales up 10.8% on the same period a year earlier and 9.6% higher compared to 2019.
Though noting there remains “substantial uncertainty” about the continued strength of consumer demand, M&S said it was an encouraging performance providing confirmation that its “Never the Same Again” transformation programme is on track. As a result, it predicted that full-year profits will beat previous guidance of £300-£350 million.
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