M&S Q1 Results
MARKS AND SPENCER GROUP PLC
QUARTER 1 2012/13 INTERIM MANAGEMENT STATEMENT
13 WEEKS TO 30 JUNE 2012
· Group sales -0.7% *
· Total UK sales -0.9%:Food +2.9%; GM -5.1%
· Like for like UK sales -2.8%:Food +0.6%; GM -6.8%
· Multi-channel sales +14.9%
· International sales +0.9% *
* Stated on constant currency basis. International sales at actual currency were -3.5% as a result of the weakening Euro exchange rate.
Marc Bolland, Chief Executive said:
"Our Food business has again performed strongly. General Merchandise underperformed in a difficult trading season. We are confident we are taking the necessary steps to address this.
"We are pleased with the performance in Multi-channel and our key International businesses, which are continuing to make good progress."
Our Food business performed well, despite a tough market and challenging comparatives. We maintained our focus on freshness, speciality and convenience. We continued to lead the way with high quality, first to market products, launching over 700 new products, including over 200 British inspired lines. Customers once again placed their trust in us at special times of the year, celebrating the Jubilee weekend in style with M&S products. At a time when value is front of mind for our customers, we launched 'Simply M&S', a range of c. 800 lines highlighting the great value we offer on everyday basics, without compromising on quality.
Clothing sales continued to be impacted by the merchandising issues in our Spring/Summer collections reported in April, but we have taken steps to strengthen the team, improve our buying and merchandising, and bring stock back on target for the Autumn/Winter season, which launches in stores later this month. The clothing market continued to be highly promotional throughout the quarter, especially in womenswear, in part due to unseasonal weather conditions. This affected categories such as casual tops, which, given our high market share, are key performance drivers at this time of year. The strongest performing categories in the last few weeks included Coats, Jackets and Hosiery, and we also saw a good performance in Indigo and Schoolwear. We offered customers better value, and more choice at the 'Good' end of the product range which traded well.
In Home our key departments of kitchens, bedrooms and bathrooms delivered a positive performance. Other sales continue to be impacted by our decision to withdraw from technology as well as weak demand for big ticket items.
We continue to make good progress with the roll-out of our new store concept, which is being delivered on plan and on budget.
Multi-channel performed well with sales up 14.9%, ahead of the market. We launched a number of new initiatives aimed at improving our customers' shopping experience, including the re-launch of our mobile website.
Our key International markets in India and China continued to trade strongly with double digit growth. However, sales were impacted by currency translation of Euro denominated countries as well as continued macro-economic weakness in the Republic of Ireland and Greece and on-going restructuring of our Central European business.
Existing guidance for the financial year 2012/13 remains unchanged.
While we expect the short term trading outlook to continue to be challenging, we are making strong progress against our goal of becoming an international, multi-channel retailer.