Clothing and home revenue decreased 25.1% reflecting an in-store sales decline of 46.5%, partly offset by online sales growth of 47.5%

Clothing and home revenue decreased 25.1% reflecting an in-store sales decline of 46.5%, partly offset by online sales growth of 47.5%

UK based retailer Marks & Spencer saw clothing and home sales drop by more than a quarter for the 13 weeks to 26 December, with the segment hurt by the on-off lockdown restrictions related to the Covid-19 pandemic.

The group reported a 25.1% decline in clothing and home revenue for the third quarter to GBP787m (US$1.07bn), reflecting an in-store sales decline of 46.5%, partly offset by strong online sales growth of 47.5%. Like-for-like sales in the category were down 24.1% on last year. 

Performance in clothing and home had been improving prior to the November lockdown (which ran from 5 November to 1 December), with sales down 16.8%. Revenue in the segment was down by 19.4% following the restrictions.

Despite the decline, M&S cited good progress in repositioning ranges and said its sales mix remained heavily biased to Covid-influenced product such as sleepwear and leisurewear.

"As we shift to trusted value many blanket promotions were removed, and the ratio of full price sales improved with full price sales declining a more modest 4.8% and online orders more than doubling. As a result, the stock position as we entered the latest lockdown was strong."

It added the current UK-wide lockdown, potentially enduring until Easter, will impact store sales and said it is continuing to actively manage its clothing and home stock and store cost base accordingly. 

International revenue, meanwhile, fell 10.4% in the third quarter, impacted by changing restrictions across the globe. 

"Given the on-off restrictions and distortions in demand patterns our trading was robust over the Christmas period," said chief executive Steve Rowe."More importantly beneath the Covid clouds we saw a very strong performance from the food business including Ocado Retail and a further acceleration of clothing and home online. 

"Near term, trading remains very challenging but we are continuing to accelerate change under our Never the Same Again programme to ensure the business emerges from the pandemic in very different shape."  

M&S will report full-year results for the 53 weeks ended 3 April on 26 May.

Click here for analyst reaction to M&S's third-quarter figures.