UK retailer Marks & Spencer has posted a 32.2% rise in adjusted profits before tax, which rose to GBP405.1m (US$772.55m) in the second quarter, driven by UK increases in both food sales, which were up 10.9%, and general merchandise sales, which rose 10% in the quarter. Overall, total sales at the retailer increased by 11% during the period to GBP3,929.4m, with international sales increasing by 17.7%.
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“We had a good first half. We have delivered better product, better service and better store environment. We have gained market share in all areas in which we trade.
We continue to invest in our stores to provide for future growth,” Stuart Rose, chief executive, said.
Backed by an aggressive marketing campaign, the group said that UK like for like sales of general merchandise rose by 7.9% with food comparable store sales trailing with a 4.7% increase.
The company’s increased its share of the food market by 20 basis points, with Marks & Spencer food sales now accounting for 4% of the UK food market. “Performance was driven by a relentless focus on quality, value and innovation, supported by powerful advertising. Our responsible approach to product development is being recognised by both our customers and campaigning and health groups,” Rose observed.
M&S has introduced a number of new healthy products to its food offering under the Eat Well line, which constitutes 30% of the total food offering. The company has also responded to the increasing demand for ethically sourced healthy foods, which is catered for by its Cook! Range of additive-free foods. The company also highlighted its value added organic food line in its successful national advertising campaign.
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By GlobalDataThe company raised earnings per share by 30.7% to 16.6 pence and increased the interim dividend by 31.3% to 6.3p, M&S chairman Lord Burns confirmed. “The group continues to make good progress and is stepping up its investment programme to secure future growth. In line with our new policy, the board is proposing an interim dividend increase of 31.3% to 6.3p per share,” he commented.
Shares in the company had gained 6.34% at 1.25pm (GMT), increasing to GBP689.11 pence.
