Marks and Spencer has reported a 62.1% drop in pre-tax profit for the year ending March 2018, amid an ongoing store closure programme.
Profits before tax dropped from £176.4m to £66.8m during the year, and the cost of the store closure programme – which will see more than 100 stores close by 2022 – was reported to be £321m, which M&S said remains in line with its plan.
A statement read: “Developments in the retail industry since then have reinforced our conviction about the need for the transformation of M&S. Changes in the high street and migration online mean that we have to be decisive with our store estate, renewing and closing stores more quickly.”
Steve Rowe, 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.”
M&S recently announced the next tranche of UK stores proposed for closure or set to close as it reshapes its UK store estate with plans to take at least a third of sales online. The closures will affect 626 employees, but the high street stalwart said all employees will be offered redeployment before a redundancy.
Sacha Berendji, retail, operations and property director at M&S, said: “Closing stores isn’t easy but it is vital for the future of M&S. Where we have closed stores, we are seeing an encouraging number of customers moving to nearby stores and enjoying shopping with us in a better environment, which is why we’re continuing to transform our estate with pace.”