M&S food sales down 0.9%

M&S’s food division has recorded a 0.9% fall in like-for-like (LFL) sales for the 13 weeks to 2 July. 

M&S said its food business continued to strongly outperform a deflationary market, with LFL sales slightly down when adjusted for the timing of Easter this year.

First-quarter food sales rose by 4.0%, with LFL sales down 0.9%, of which 0.5% was due to Easter timing, it said. New Simply Food stores continued to perform ahead of expectations.

It also said chief executive Steve Rowe was trying to reposition the retailer by cutting prices and reducing the number of promotions.

M&S reported its sharpest quarterly decline in clothing sales in more than a decade. LFL clothing and home sales were worse than expected, falling 8.9% in the 13 weeks to 2 July.

“These are not the numbers I wanted to see,” said Rowe, “not by any stretch.”

Rowe said consumer confidence had weakened in the run-up to the EU referendum last month, but added it was “too early” to say what effect the UK voting to leave the EU would have on the business – the company maintained its full-year guidance.

He said: "As highlighted in May, consumer confidence weakened in the run up to the EU referendum. While it is too early to quantify the implications of Brexit, we are confident that our strategic priorities and the actions we are taking remain the right ones to deliver results for our customers and our business.”

Shares in M&S fell more than 1.5% in the first hour of trading this morning (7 July). The retailer has seen more than a third of its value wiped off in the last two months.

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