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Gloucestershire Business News

Marks and Spencer reveal a significant drop in profits

Marks and Spencer have reported a slide in profits for the first half of their financial year.

Profits dropped by 17.1 per cent to £176.5million for the six months to September 28.

Total revenues were also down by 2.1 per cent to £4.860 billion after a "weak first half in clothing and home sales."

Clothing and Home saw like-for-like sales slump by 5.5 per cent with the firm pointing to buy and supply chain issues.

Food showed some growth, however, with a 0.9 per cent increase driven by volume of sales.

The firm are currently in the process of a transformation plan and pointed to the food side of the business being on track.

In a statement released to the Stock Exchange, the firm said they were making "further action on UK store estate reshaping with 17 full-line stores closed.

That had helped to make cost savings of around £75million in the half with chief executive Steve Rowe saying the plan was working.

He said: "Our transformation plan is now running at a pace and scale not seen before at Marks & Spencer.

"For the first time we are beginning to see the potential from the far reaching changes we are making.

"The Food business is outperforming the market. Our deal to create a joint venture with Ocado is complete and plans to transition to the M&S range are on track.

"In Clothing & Home we are making up for lost time.

"We are still in the early stages, but we are clear on the issues we need to fix and, after a challenging first half, we are seeing a positive response to this season's contemporary styling and better value product.

"We have taken decisive action to trade the ranges with improved availability and shorter clearance periods.

"In some instances dramatic sales uplifts in categories where we have restored value, style and availability illustrate the latent potential and enduring broad appeal of our brand. Our cost reduction and store technology programmes are on track."

Marks and Spencer shares were trading slightly up this morning after the statement was released to the Stock Exchange.

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