Marks and Spencer stormed to the top of the FTSE 250 leaderboard on Tuesday after the retailer lifted its profit forecasts for the full year.
At 222.6p per share the Marks and Spencer share price was 8.8% higher on the day.
The company said that “the first 19 weeks of the year has seen continued market share growth in both the Clothing & Home and Food businesses, and good progress on the programme to reshape M&S.”
Strength Across the Board
Like-for-like sales at its Clothing & Home Unit arm rose 6% during the 19 weeks to 12 August, driven by strong demand in the retailer’s stores.
Marks and Spencer said too that “sell through rates have been robust and stock into sale was lower than planned.”
Meanwhile, like-for-like sales at the company’s Food unit were up 11% year on year.
At group level the company said that its operating margin has remained “robust.”
M&S commented that “there remain considerable uncertainties about the economic outlook, and there is a risk that the consumer market will tighten as the year progresses.”
But it added that “we now expect the outcome for the year to show profit growth on 2022-23, and the interim results to show a significant improvement against previous expectations.”
The business will release results for the six months to September on 8 November.
Cracking Open the Elderflower
Today’s update is a reassuring reminder of the solid progress M&S’s turnaround strategy is making. It also serves as a reminder of the resilience of Britain’s retail sector despite the ongoing cost-of-living crisis.
Earlier this month FTSE 100 retailer Next raised its profits guidance again following strong summer trading.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said that Marks and Spencer’s trading update “shows just how much more resilient shoppers are proving to be despite the ongoing storm of inflation and higher interest rates.”
She added that M&S is “not quite popping the champagne corks just yet, with management flagging uncertainty ahead, but the results will certainly warrant unscrewing some elderflower sparkling in celebration.”
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