UK food and clothing retailer Marks & Spencer has said group profit before tax and exceptional items for the year to 3 April is expected to be in line with expectations, as cost controls offset disappointing fourth quarter sales.
Fourth-quarter sales declined 0.1%, or 3.4% on a like-for-like basis, while full-year sales edged up 1.8%, but slid 0.4% on a like-for-like basis. Food sales for the fourth quarter rose 4.3% compared to the year-ago period, but slid 1.4% on a like-for-like basis. Full-year food sales rose 5.7%, or 1.6% on a like-for-like basis.
“In an increasingly competitive food sector we have maintained our market share, with the Simply Food and Food stores making our product more accessible to more customers,” said CEO Roger Holmes.
“However, our like-for-like sales this quarter, again impacted by inconsistent execution across a number of key categories and events, are disappointing,” he added.
Holmes said the company is taking a number of actions to improve its performance in food sales, including developing more distinctive new products across all areas, particularly for special events. The company also plans to work on clearer promotions and price communication, more effective advertising and improved availability, particularly in smaller stores.
Marks and Spencer has 74 Simply Food and Food stores and said it remains on track to add 500,000 square feet of new food selling space by 2005/06.