M&S accelerates store closures as profits tumble
Retailer Marks & Spencer has this morning announced its annual pre-tax profits tumbled 62% as it prepares to close 100 stores nationwide.
The firm yesterday revealed some details about its closure plans and named the first 14, which included Walsall.
Councillor Sean Coughlan, leader of Walsall Council said: “The news of the proposed closure of the Marks and Spencer store is disappointing for all residents and visitors to the town.
“We were not aware of their intentions at the time of the purchase of the Saddler’s Centre and they still have a lease in place for floor space in the Saddler’s Centre. We will continue to work with all of our tenants to make the Saddlers Centre a destination shopping location”.
This morning reporting on the year-ending 31 March, Marks & Spencer saw pre-tax profits come in at £66.8m – down from £176.4m the previous year. Earnings per share also crumbled – down from 7.2p to 1.6p this year.
Steve Rowe, Marks & Spencer CEO, said: “At our half year results in November I 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.
“There are a number of structural issues to address and we are taking steps towards fixing these. 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.”
Richard Lim, chief executive of analysts Retail Economics, added: “Accelerating the pace of transformational change has led to significant write-offs across the business. Overcapacity concerns are at the heart of plans to close a quarter of legacy Clothing and Home space. The retailer has too much space in today’s digitally-driven age of consumption. These are bold decisions to embrace, adapt and innovate in order to survive.
