Trading Statement

RNS Number : 9027E

Marks & Spencer Group PLC

02 October 2008

 



MARKS AND SPENCER GROUP PLC

QUARTER 2 Trading Statement 2008/09 - 13 weeks to 27 September 2008

• Group sales up 0.4%

• UK sales down 1.6%: General Merchandise -2.9% (Clothing -3.5%; Home +2.9% ); Food -0.5%

• UK like for like sales down 6.1%: General Merchandise -6.4%; Food -5.9%

• Online Sales up 34%

• International sales up 24.2%

Sir Stuart Rose, Chairman said:

'Group sales were up 0.4%. In the UK sales were down 1.6%, although they remained relatively steady quarter on quarter, despite the difficult environment. Consumer confidence remains fragile and the retail environment unpredictable. Consumers are increasingly cautious about their budgets. We have responded by offering our customers better values and more promotions across the business, while at the same time tightly controlling our costs.

'In General Merchandise we continue to offer great quality, stylish product, combined with keen values across all price points. We are confident about our Autumn/Winter offer. In Food, we are committed to giving our customers outstanding product while implementing a range of initiatives to improve value, innovation and availability. 

'Our investment to improve values along with a more promotional stance has more than offset improvements in bought-in margins. As a result, we are currently expecting a reduction of around 100 basis points in UK gross margin for the full year, although this will depend on market conditions and our trading stance. 

'We have managed operating costs tightly and now expect operating cost growth for the full year of 

4-5%, compared to our previous guidance of 7%. Capital expenditure this year is now expected to be around £700m compared to our previous guidance of £800-900m. For 2009/10 we now expect to spend around £400m with the focus of spend being on supply chain and information technology systems.'

Marks and Spencer Group plc will report its 2008/09 Interim results on 4 November 2008.

Statements made in this announcement that look forward in time or that express management's beliefs, expectations or estimates regarding future occurrences and prospects are 'forward-looking statements' within the meaning of the United States federal securities laws. These forward-looking statements reflect Marks & Spencer's current expectations concerning future events and actual results may differ materially from current expectations or historical results. Any such forward-looking statements are subject to various risks and uncertainties, including failure by Marks & Spencer to predict accurately customer preferences; decline in the demand for products offered by Marks & Spencer; competitive influences; changes in levels of store traffic or consumer spending habits; effectiveness of Marks & Spencer's brand awareness and marketing programmes; general economic conditions or a downturn in the retail or financial services industries; acts of war or terrorism worldwide; work stoppages, slowdowns or strikes; and changes in financial and equity markets.

Contacts:

Investor Relations:    

Amanda Mellor                         [phone]

Majda Rainer                            [phone]

Corporate Press Office:             [phone]

Investors & Analysts Conference Call:

This will be hosted by Stuart Rose at 08.30 (GMT) on Thursday 2 October 2008:

Dial in number:                         [phone]

A recording of this call will be available until Thursday 9 October 2008:

Dial in number:                        [phone]  Access Code: 140631#

 

END

 

 

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