M&S Reports Fall in annual Profits

Retail giant M&S (MKS) reported a drop in annual profits this morning as its clothing division continues to struggle.  Pre tax profit cam in 3.9 % lower than previously at £623m.

General Merchandise, the clothing arm reported a 1.4% drop in like for like sales, however there was more positive news for the other sections of the business. Food like for like sales growing 1.7%, and total UK sales growing 0.2%.  International sales and multichannel sales were also strong performers.

The company dividend remains unchanged at 17p per share.

Marc Bolland, Chief Executive, said:
“M&S grew sales by 2.7% last year. We are focused on improving our performance in General Merchandise and were pleased to see early signs of improvement. Our Food business had a very strong year, consistently outperforming the market.

“Three years ago, we recognised the scale of investment required to transform our business, investing to strengthen our foundations and improve our customer offer. We are making solid progress on this journey and are now focused on delivery.”

Robert Swannell, Chairman, said:
“The investment made in executing our strategy over the last three years puts M&S in a stronger position to compete in a retail world undergoing profound change. Our priorities now are to deliver on the investment we have made and to make M&S a more profitable, stronger and well-equipped business.

“In line with our dividend policy, the Board is recommending a final dividend of 10.8p per share, resulting in a full year dividend of 17.0p per share, level on last year.”

RBS Jumps on Profit Rise

Royal Bank of Scotland (RBS.L) the majority UK tax payer owned bank today jumped, trading nearly 12% up early on this morning after the bank announced a rise in profits with pre-tax profit rising to £1.64bn in the first three months of 2013, up from £826m the year before.

Highlights of the announcement include:

  • Operating profit in the retail and commercial banking businesses was up 36% to £1,373 million, driven by good cost control and improving impairment trends, particularly in UK Corporate and Ulster Bank.

● Markets operating profit was up 14% to £318 million, with costs down 15%.

● RBS Capital Resolution (RCR) reduced RWA equivalents(3) by £14 billion during Q1 2014 to £51 billion, with lower than expected operating losses of £114 million.

Ross McEwan, Chief Executive commenting said “Just over two months ago, I set out our plan for making RBS the most trusted bank in the UK. Today’s results show that in steady state, RBS will be a bank that does a great job for customers while delivering good returns for our shareholders. But we still have a lot of work to do and plenty of issues from the past to reckon with. Everyone at RBS is focused squarely on doing everything we can to earn the trust of our customers and in the process change the banking sector for the benefit of the UK.”