M&S set for first rise in annual profit in four years

Marks & Spencer is expected to report its first rise in annual profit in four years next week, fuelling hopes it has finally rediscovered a winning formula.

Shares in M&S have risen by a third over the last nine months, hitting a seven-year high last month ahead of the earnings on May 20. The increase reflects hopes that the billions of euro that CEO Marc Bolland has spent on the redesign of products, stores, logistics and its website is paying off and addressing decades of under-investment in the 131-year-old firm. Analysts expect M&S to report profit before tax and one-off items of £625m-£664m (€865m-€920m ) for the year to the end of March. M&S is expected to raise its dividend by 5%, to 17.8p, and has promised an update on other rewards for shareholders. The company is expected to raise its dividend by 5%, to 17.8p, and has promised an update on other rewards for shareholders.

“We believe some indication of potential additional returns could be on the agenda,” said analysts at Nomura, pointing to scope to return £250m in special dividends.