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M&S says confidence 'stabilising' | M&S says confidence 'stabilising' |
(about 2 hours later) | |
Marks and Spencer has said that "consumer confidence appears to be stabilising", although it remains cautious about the next 18 months. | Marks and Spencer has said that "consumer confidence appears to be stabilising", although it remains cautious about the next 18 months. |
Its UK like-for-like sales, which exclude new stores, fell 1.4% in the 13 weeks to 27 June, with food down 0.5% and general merchandise down 2.4%. | Its UK like-for-like sales, which exclude new stores, fell 1.4% in the 13 weeks to 27 June, with food down 0.5% and general merchandise down 2.4%. |
In the previous three months, UK like-for-like sales had fallen by 4.2%. | |
"The good news this year is that there is more visibility about the sales level," M&S chief Sir Stuart Rose said. | |
"This time last year it was a very difficult situation because we were headed downhill. | "This time last year it was a very difficult situation because we were headed downhill. |
"But it's very hard to call whether this is a plateau, whether this is a continuing decline, whether there's any movement upwards. So I'm not saying there are any green shoots, I'm just saying this is a stable situation - so far, so good." | |
M&S share price | |
M&S said total group sales - including new stores - rose 2.9% in the period, with total UK sales up by 1.7%. | |
Richard Hunter, head of UK equities at Hargreaves Lansdown Stockbrokers, said the decline in M&S's UK like-for-like sales was smaller than expected, and was the latest sign from retailers that the spending downturn was easing. | |
"The phrase 'challenging outlook' is increasingly being replaced by a 'stabilising consumer' and M&S is the latest to add to this view," he said. | |
Leadership row | |
Last week, Sir Stuart offered to waive a slice of his long-term bonus award, an entitlement to shares worth £1.16m. | Last week, Sir Stuart offered to waive a slice of his long-term bonus award, an entitlement to shares worth £1.16m. |
The shares were awarded on 11 June under a performance-related three-year bonus plan, but M&S said it had faced an "unexpected" shareholder reaction. | |
However, Sir Stuart is still set to come under pressure at the retailer's annual general meeting (AGM) next week over his combination of the roles of chairman and chief executive. | |
The combination of the two roles goes against corporate governance guidelines, and three shareholder advisory groups have recommended that M&S shareholders back a resolution at the AGM calling for an independent chairman to be appointed by July 2010. | |
But Sir Stuart told the BBC that he still intended to stick to his plan to leave in 2011. | |
"We've laid our story out quite clearly," he said. "We'll have a new chief executive in 2010 and I will leave the business by July 2011." |