M&S reports large increase in operating profit for 16 stores operated in Republic

'Lower supply chain costs in the food business drove much of the improvement,' says retailer

Reflecting a strong rebound for the once ailing business in Britain, the retailer reported group-wide total annual sales of £13.1bn. Picture: James Manning/PA

Marks & Spencer has reported a huge increase in operating profit to almost £28m (€33m) on annual sales of €320m for the 16 stores it operates in the Republic, thanks to food sales in the past year.

Sales in the Republic of Ireland rose by an "encouraging" 2.4% to £320.7m in the 52 weeks to the end of March, while operating profit climbed to £27.9m from £16.9m in the same period last year, the British foods and clothes retailer said in its annual group results. 

It also reported an adjusted operating margin of 8.7% for its retail operations in the Republic, up from 5.4% a year earlier. 

"Lower supply chain costs in the food business drove much of the improvement," M&S said of its performance in the Republic.

 "Food has made progress on local sourcing and has successfully expanded its presence through franchising with Applegreen, which now operates 10 stores," the company said. 

It will be the last opportunity to get detailed and timely information on the trading and profit performance for the M&S stores in the Republic, as the retailer plans to no longer break out the local results and will include the figures in a new UK and Republic of Ireland segment. 

M&S has a total of 38 stores across Ireland, including 16 in the Republic and 22 stores in the North. The company also sells products through some Applegreen petrol forecourts. Excluding the Republic, international sales fell 1%, M&S said. 

Reflecting a strong rebound for the once ailing business in Britain, the retailer reported group-wide total annual sales of £13.1bn, sharply up 9.4% from the previous year. Total operating profit climbed almost 34% to £838.6m. 

Chief executive Stuart Machin hailed the figures as marking a major step in recovery. 

"Two years into our plan to 'Reshape for Growth' we can see the beginnings of a new M&S," Mr Machin said in the earnings statement. 

"food and clothing and home grew volume and value share ahead of the market and sales increased across stores and online. Both businesses have now delivered 12 consecutive quarters of sales growth and this trading momentum gives us wind in our sails, and confidence that our plan is working," he said. 

M&S shares closed 4% higher, erasing losses since the start of the year.