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| Marks & Spencer head of non-food to leave after UK sales fall | Marks & Spencer head of non-food to leave after UK sales fall |
| (about 3 hours later) | |
| Kate Bostock, the head of all of Marks & Spencer's non-food business including clothing, is to leave as part of a top-level shakeup after the high-street retailer announced one of its worst trading performances in the past decade. | Kate Bostock, the head of all of Marks & Spencer's non-food business including clothing, is to leave as part of a top-level shakeup after the high-street retailer announced one of its worst trading performances in the past decade. |
| Bostock, who is long thought to have had a tense relationship with chief executive Marc Bolland, is departing by "mutual consent to pursue other interests" on 1 October, when she will also leave the M&S board. | Bostock, who is long thought to have had a tense relationship with chief executive Marc Bolland, is departing by "mutual consent to pursue other interests" on 1 October, when she will also leave the M&S board. |
| The move was announced on Tuesday as the retailer unveiled a gloomy trading update in advance of the same day's annual meeting with shareholders, where the board is likely to come under fire for poor performance and excessive pay. General merchandise sales in the UK fell by 5.1% – or by 6.8% if new stores are excluded – in the 13 weeks to the end of June. While sales for the group and the UK were also down, the total figures were buoyed by rising sales of food. | The move was announced on Tuesday as the retailer unveiled a gloomy trading update in advance of the same day's annual meeting with shareholders, where the board is likely to come under fire for poor performance and excessive pay. General merchandise sales in the UK fell by 5.1% – or by 6.8% if new stores are excluded – in the 13 weeks to the end of June. While sales for the group and the UK were also down, the total figures were buoyed by rising sales of food. |
| The figures are among the worst the company has produced in the past 10 years, and had been expected by the City. Marks & Spencer's fall from favour was starkly illustrated last month when – for the first time in living memory – it could no longer boast being the most valuable clothing retailer listed on the London Stock Exchange after being overtaken by Next. | The figures are among the worst the company has produced in the past 10 years, and had been expected by the City. Marks & Spencer's fall from favour was starkly illustrated last month when – for the first time in living memory – it could no longer boast being the most valuable clothing retailer listed on the London Stock Exchange after being overtaken by Next. |
| Bolland, who joined the group from supermarket Morrisons in 2010, admitted: "General merchandise underperformed in a difficult trading season. We are confident we are taking the necessary steps to address this." | Bolland, who joined the group from supermarket Morrisons in 2010, admitted: "General merchandise underperformed in a difficult trading season. We are confident we are taking the necessary steps to address this." |
| In a conference call to City analysts he admitted that he did not believe that there was going to be a massive change in trading fortunes during the rest of the summer, despite the Olympics. He said: "I'm a glass half full man. And I'm a glass half full man on the UK summer of 2012. The Olympics will be the same effect. Customers are planning fewer day trips and if we get a continuation of the [weather] I don't expect a huge uptick because of the Olympics." | |
| John Ibbotson, director of the retail consultants Retail Vision, added: "While all retailers with seasonal lines are at risk from dramatically unseasonal weather, Marks has suffered more than most. Only its food department stayed afloat amid a deluge of bad numbers. SOS M&S. That's the inescapable conclusion to be drawn from these numbers." | |
| Bolland was keen to sign off his conference call to analysts on a positive note, by talking about how he had hired a "best in class" team to run general merchandise after Bostock's departure. | |
| John Dixon, a 26-year M&S veteran and the group's executive director of food, will replace Bostock and report directly to Bolland. | John Dixon, a 26-year M&S veteran and the group's executive director of food, will replace Bostock and report directly to Bolland. |
| In a shock move to revitalise M&S's flagging clothing business, Belinda Earl, the former chief executive of Debenhams and Jaeger, will also join as style director, working two to three days a week. M&S shares reacted well to the package of announcements, rising around 1% in early trading. | |
| The changes come after months of speculation that the departing Bostock would be taking a role at the online retailer, Asos, which Bolland described as "not helpful". | |
| In stark contrast to M&S, the website also updated shareholders on its trading on Tuesday morning, showing an 8% rise in sales in the UK over the past three months and a 31% increase overall. |