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Back on track M&S beats forecasts

10/01/2006

Marks & Spencer (M&S) today posted a set of results confirming that the leading retailer's recovery is continuing apace, as third quarter sales including Christmas beat expectations.

The perennial high street retailer delivered like-for-like sales growth of 2.9 per cent for the three months ending on December 31st.

The figures marked a 0.9 per cent improvement on the best estimates of analysts who were predicting like-for-like sales growth in the region of two per cent.

Although M&S traditionally profits most from its clothing sales, the 122-year-old firm benefited most from its food sales over the period, which were far stronger than anticipated and rose by close to eight per cent.

Sales of non-food merchandise grew at an appreciably slower rate of 2.1 per cent but full price sales of general merchandise rose by five per cent, compared to a figure of 0.4 per cent last year.

M&S chief executive Stuart Rose was particularly pleased with the results given that the retailer had not followed the lead of other high street giants and resorted to heavy discounting in the run-up to Christmas.

"Overall we have repositioned our prices and concentrated on giving our customers value. In terms of discounting: absolutely no discounting at all," he said.

He added: "I am very pleased with this set of results but we have a lot more work to do."

M&S's strong pre-Christmas performance echoes similar results released by John Lewis last week.

A number of leading high street retailers are due to release Christmas trading statements later this week.

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