The boss of Marks & Spencer yesterday declared the company is in its ‘strongest financial health’ for more than a quarter of a century as profits soared.
Unveiling annual results described as ‘dazzling’ by one analyst, Stuart Machin said ‘we’re at the beginnings of a new M&S’ as it appeals to a broader base of shoppers.
And in the clearest sign yet that its revival plan is paying off, the High Street stalwart said that profits jumped 58 per cent to £716million in the year to the end of March.
‘We have wind in our sails, confidence our plan is working and a clear vision for the future.
There’s so much more opportunity ahead of us,’ said Machin, who has continued to implement a turnaround plan kicked off by chairman and retail veteran Archie Norman.
In the pink: Marks & Spencer, which is currently projecting a ‘summer cool’ image, has seen profits jump 58% to £716m in the year to the end of March.
Both arms of the business saw goods fly, with food sales 13 per cent higher while clothing and home was up 5.3 per cent.
M&S shares rose almost 10 per cent to 300p in early trading – the highest level for six years – before closing up by 5.2 per cent, or 14.2p, at 288p yesterday.
Investors lauded the progress as the business said it would dish out a dividend of 3p a share, its first award since 2019.
‘This is an incredibly impressive set of results, proving that the transition strategy put in place by the current management team is really starting to deliver,’ said Ian Lance at Redwheel, its third-largest shareholder.
‘What is so exciting is that it feels like this turnaround strategy still has some way to go and yet this is not yet being reflected in the share price as many investors remain sceptical of the Marks recovery story.’
After years of its fashion lines being derided as ‘dowdy’, the retailer has bolstered its credentials and managed to entice new and younger shoppers.
It has also swung back into style – thanks to star-studded partnerships such as with actress Sienna Miller and Ted Lasso star Hannah Waddingham.
On the food side, new customers have been flocking to stores ‘from a broad spectrum of retailers’ even for their big weekly shops, Machin said.
Bumper sales means it is now hot on the heels of Middle England rival Waitrose.
Turnaround: Chief exec Stuart Machin said ‘we’re at the beginnings of a new M&S’ as it appeals to a broader base of shoppers
This has helped the retailer into its healthiest financial position since 1997, Machin said. But he promised that there was more to come as it looks to open nine new food stores and refurbish existing stores.
He also hopes its clothing division will poach more shoppers too, as its ranges become ‘more relevant to more people more of the time’.
M&S plans to stock more third-party fashion brands after already selling big names like Nike, Adidas and Hunter.
Machin said: ‘We’re creating a very different M&S culture that is sleeves-rolled-up, even closer to customers and closer to colleagues. We always aim higher and tell it as it is.
‘It’s a matter of being positively dissatisfied.’
Mark Crouch, an analyst at investment platform Etoro, said that the results made for‘ dazzling reading’.
He added: ‘In what has become one of the most emphatic turnarounds seen in British retail in recent years, the M&S comeback story is turning into a fairytale for investors.’