M&S’s recent trading update for Christmas and Q3 reveals impressive performance, maintaining strong sales momentum throughout 2023. The company reported a 7.2% rise in group sales to £3.856 billion, outperforming the broader UK retail sector. Notably, the Clothing & Home division, historically challenging for M&S, showed significant improvement, rising by 4.8% on both total and like-for-like bases to £1.236 billion.
The larger food division also demonstrated resilience, achieving a remarkable 10.5% increase to £2.332 billion (9.9% like-for-like). Total UK sales surged by 8.5% to £3.568 billion. While Clothing & Home International sales faced a 6.4% decline to £288 million, attributed to planned franchise shipments and challenging market conditions in India, the core UK operation showcased robust growth.
CEO Stuart Machin highlighted the success of M&S’s strategy to reshape for growth, emphasizing sustained momentum in Food and Clothing & Home. Womenswear emerged as the star performer, exceeding market growth in both volume and value. The division’s sales growth was accompanied by an improvement in style perception, maintaining a lead on quality and value.
Clothing & Home like-for-like sales were primarily driven by an increase in average selling price, partly due to reduced promotions. Market share witnessed growth, particularly in womenswear, supported by enhanced customer perceptions. Store sales increased by 2%, with new full-line stores exceeding expectations. Online sales, growing by 10.9%, benefited from improved carrier service levels and robust demand for click & collect.
Key performing categories within Clothing & Home included knitwear, denim, and top-of-range Autograph lines. The full-price sales mix improved, and clearance sale stock reduced by 6% year-on-year. M&S expressed optimism for the future, outlining plans to focus on trusted value, accelerate store rotation, enhance supply chain programs, and reset digital and technology strategies.
As CEO Stuart Machin stated, ‘We enter 2024 with a spring in our step, clear-eyed on near-term challenges, and determined to achieve our vision of being the most trusted retailer. Our commitment to quality products remains at the heart of everything we do, with ample opportunities ahead.
