MARKS AND SPENCER said today (6 April) that its sales rose by more than 2% during its fourth quarter, with the UK retailer insisting it “outperformed the market” and grew its share of the grocery market.
The retailer said today (6 April) that, for the quarter ended 2 April, group sales were up 2.3%. Its food division recorded a 4.9% sales gain, while like-for-like sales in its food operations were up 3.4%.
M&S said its food sales delivered another quarter of “consistent improvement” with market share up 10 basis points to 3.8%. The retailer said it launched more than 320 products during the quarter, bringing the total of lines launched over the last year to 1,900, over 25% of its range.
Meanwhile, international sales were up 12.6%, reflecting strong performances across most of its markets but offset by “difficult” trading conditions in Ireland and Greece.
“We had a good fourth quarter in a challenging trading environment. In times like these customers are increasingly turning to M&S for value, quality and innovation. Strong products backed by great advertising meant we outperformed the market and grew share in both food and clothing,” said chief executive Marc Bolland.
However, the retailer was cautious in its outlook, expecting “increasingly challenging” trading conditions during 2011/12 due to “pressure on consumers’ disposable incomes and higher commodity prices”.
It said its focus will be on remaining competitive, and offering great value and quality “at a time when they will be managing their budgets carefully”.
For the coming financial year, the retailer expects gross margin to increase by 0-25 basis points due to a “combination of measures to mitigate cost input inflation”. Operating costs are expected to increase by around 5% due to increased depreciation space growth, inflation as well as investment in growth initiatives.
It expects that capital expenditure for the year will be around GBP900m (US$1.5bn). M&S’s footage is expected to grow by 2% in the UK and 10% internationally.
Shares in the retailer were up 4.2% at 08:33 BST to 354.5p a share.
Click here for M&S’s full earnings statement, and check back later for further insight into the retailer’s results.