M&S update to offer retail clues

http://news.bbc.co.uk/go/rss/-/1/hi/business/6286350.stm

Version 0 of 1.

The impact of interest rate rises and bad weather on the High Street is to become clearer on Tuesday as Marks & Spencer gives details on recent trade.

Reports have suggested sales growth may be at its slowest rate for two years.

Chief executive Stuart Rose warned in May that the retail climate was becoming "more challenging" as pressure on household budgets increased.

Analysts say the wettest June on record has left retailers struggling to sell everything from summer clothes to food.

Tougher times

It has been a tough time for High Street names with supermarket chain Kwik Save and outdoor clothing firm Hawkshead both going into administration in the past week.

And the uncertain outlook for the retail sector saw would-be buyers of the New Look chain pull out of the deal.

Retail industry figures said Thursday's decision by the Bank of England to raise interest rates to 5.75% - the fifth rise since August - was also likely to dent consumer spending.

M&S has gained market share in all key clothing categories

M&S has enjoyed a renaissance since Stuart Rose took charge in 2004, posting a 28.5% increase in annual pre-tax profit to £965.2m last year.

It has gained market share in food sales and key clothing categories, helped by successful advertising campaigns featuring model Twiggy, singer Bryan Ferry and other celebrities.

As well as an update on first quarter trading, M&S may give details about the future of George Davies, designer of the firm's Per Una range, amid reports he may soon leave.

Reports have suggested Mr Davies - who designed ranges for Next and Asda before joining M&S - is not planning to renew his contract in the autumn.

The company has, up to now, declined to comment on such reports.