M&S expects ‘further progress’ after first-half profit beat

LONDON (Reuters) – British retailer Marks & Spencer (OTC:) forecast “further progress” in the balance of the year after reporting a better-than-expected 17.2% rise in first-half profit, helped by market share gains, adding to evidence its latest turnaround plan is working.

After over a decade of failed revival efforts, M&S under CEO Stuart Machin is reaping the rewards of a costly programme to improve the value and quality of its food and clothing, overhaul its store estate, upgrade its technology and e-commerce operations and modernise its supply chain.

Its shares have soared 75% over the last year, recently hitting an eight-year high.

The group made profit before tax and adjusting items of 407.8 million pounds ($524.6 million) in the six months to Sept. 28 – ahead of analysts’ consensus forecast of 361 million pounds and the 348.1 million pounds made in the same period last year.

Revenue rose 5.7% to 6.48 billion pounds, with food sales up 8.1% and clothing and homeware sales up 4.7%.

“In the first five weeks of the second half overall trading remains on track and we are confident of making further progress in the remainder of the year,” M&S said.