Marks & Spencer has fallen to a loss for the first time in its 94 years as a public company but has hailed its ‘resilience’ in the face of the coronavirus pandemic.
With many of its stores having to shut or reduce operations at some point during the pandemic, the high street giant fell to a £87.6m pre-tax loss for the 26 weeks to September 26. That compared to a £158.8m profit from the same period last year.
But the company said it had performed “better than expected” during the first half, with revenue falling less than initially predicted.
It said revenue for the period slid by 15.8% to £4.09bn, mainly due to the impact of lower clothing and home sales.
Steve Rowe, chief executive of M&S, said: “In a year when it has become impossible to forecast with any degree of accuracy, our performance has been much more robust than at first seemed possible.
“This reflects the resilience of our business and the incredible efforts of my M&S colleagues who have been quite simply outstanding.
“But out of adversity comes opportunity and, through our Never The Same Again programme, we have brought forward three years change in one to become a leaner, faster and more digital business.
“From launching M&S Food online with Ocado to establishing an integrated online business division ‘MS2’ to step-change growth, we are taking the right actions to come through the crisis stronger and set up to win in the new world.”
M&S said adjusted operating profit in its food section was up 19%, while it took half-year profits of £38.8m from its Ocado Retail joint venture.
But it highlighted how city centre stores in particular had struggled during the pandemic, with sales down 53% compared a 25% reduction in retail parks.
The company added that a programme of store closures and other savings announced in august would generate annual savings of at least £115m.
The update came as M&S continues to push forward with its Never The Same Again transformation programme.
It said the programme, which saw M&S slash 7,000 jobs in August, will enable the business to emerge from the crisis in a “stronger, leaner and more focused position”.