Rising costs and strategic shifts signal a pivotal moment for M&S.

  • Marks and Spencer expects profits to flatline in the upcoming financial year.
  • The company is permanently exiting Russia, incurring an additional cost of £31m.
  • M&S reported a profit before tax of £522.9m for the year ending April 2022.
  • Revenue increased by 6.9% to £10.8bn, driven by a 10% rise in food sales.
  • CEO Steve Rowe emphasizes the company’s transformation and future growth potential.

Marks and Spencer (M&S) has announced that it anticipates its profits will remain stagnant in the upcoming financial year due to the rising cost of living and increased operational costs. This announcement coincides with M&S’s decision to permanently exit the Russian market, a move that follows a temporary suspension of trading due to the ongoing conflict in Ukraine. The company estimates that this exit will incur additional costs of £31 million. Furthermore, as M&S invests in expanding its capacity at Ocado Retail, it expects only a minimal contribution to its overall net income. In its recently released full-year results for the 52-week period ending April 2, 2022, M&S reported a profit before tax and adjusting items of £522.9 million, a significant increase from £403 million the previous year. On a statutory basis, the company returned to profitability with profits after tax of £309 million, compared to a loss of £201.2 million the prior year. Revenue for the period rose by 6.9% to £10.8 billion, largely due to a 10% increase in food sales and a 3.8% rise in clothing and home sales. CEO Steve Rowe highlighted the importance of these results, stating that they reflect M&S’s fundamental transformation and potential for future growth. He expressed pride in the progress made and acknowledged the hard work of the team, as he prepares to pass leadership to his successors.

Factuality Level: 8
Factuality Justification: The article provides accurate information about Marks and Spencer’s financial performance, its decision to exit Russia, and CEO Steve Rowe’s comments on the company’s progress and future growth potential.
Noise Level: 3
Noise Justification: The article provides relevant information about Marks and Spencer’s financial performance and strategic decisions, including profit expectations, exit from Russia, and CEO’s comments on the company’s progress. It also includes specific numbers for revenue growth and profitability. The content is focused on the topic without diving into unrelated territories.
Financial Relevance: Yes
Financial Markets Impacted: Marks and Spencer’s stock price and related retail stocks
Financial Rating Justification: The article discusses Marks and Spencer’s financial performance, profit expectations, and business decisions that will impact its future growth and profitability, which are relevant to financial topics and can affect the company’s stock price and the broader retail sector.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification:

Reported publicly: www.retailsector.co.uk