ANALYSIS: M&S hails purple patch for clothing
Sir Stuart Rose made one of his last trading updates as M
UK retailer Marks and Spencer (M&S) has reported strong growth in clothing in the final quarter of the year, but predicted full-year profits below last year's level.
In a statement the company said that profit before tax for the year was expected to be in the range of GBP620m (US$943.4m) to GBP630m.
In May last year though, M&S saw FY profits of GBP706.2m from GBP1.13bn in the previous year.
However, clothing sales during this year's fourth quarter soared 10.1%, compared to a 2.6% rise in food sales.
M&S chief executive Sir Stuart Rose told media this morning (8 March) "We are seeing a particular purple patch in clothing at the moment, where every clothing category has done well."
Sir Stuart said the company had seen market share increases for its women's wear, lingerie, men's wear and children's wear products.
The company had earlier reported that clothing market share was up 110 bps to 11.9%, with sales of formalwear and knitwear particularly strong during the year.
M&S said its total UK sales had grown 6.2% in the fourth quarter, but that international sales dipped 5.9%.
It said that its anticipated profits reflected gross margin better than guidance, and is paying a bonus of around GBP80m to be shared by employees.
Sir Stuart added: "M&S is in a strong position, and through the worst ravages of the recession."
Meanwhile, Sir Stuart also responded to a recent rift with the UK Government over proposed National Insurance increases.
"I think that National Insurance is a tax on jobs and there might be better ways to skin a cat," Sir Stuart added.
Marc Bolland will take over as the retailer's new CEO as of 4 May.
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