M&S reports 3.3% sales increase but clothing division continues to struggle

Marks and Spencer has reported a 3.3% year-on-year increase in first quarter group sales but is seeing growth continually held back by an underperforming clothing division.

The British retail giant’s sales for the three months to the end of June, on a constant currency basis, were largely driven by a strong performance from its food division.

In the group’s core UK division, total sales were up 2.7% on the corresponding period last year. Food sales were up by 4.5% and general merchandise rose by 0.5%.

On a like-for-like basis, UK sales were up by just 0.3%, with food ahead by 1.8% and general merchandise down by 1.6%.

Combined international sales, which include its 21 Irish stores, were up by nearly 9%, while online sales surged ahead by just under 30%.

“Our general merchandise business showed some improvement this quarter, and the food business delivered another excellent performance, continuing the strong underlying trend. Our international business also performed well, during the quarter, and M&S.com sales were very strong,” group CEO, Marc Bolland summed up.

However, an eighth straight quarter of declining underlying sales of clothes grabbed the attention of most British-based commentators — who are now saying that management is under increased pressure to transform its clothing sales when it starts rolling out its new ranges later this month.

M&S did still post its best non-food figures since the same quarter of 2011.

While its Irish performance is wrapped up in M&S’ ‘international’ division, a spokesperson noted that the quarter here had seen strong kidswear sales, driven by back-to-school offers; and very strong demand for its ‘shop your way’ online service.