M&S profits plunge 62pc amid sweeping store closure plans

Marks & Spencer to shut 100 stores by 2022 amid online push

However, M&S improved its gross margin in the clothing and home division for the year by 50 basis points.

However M&S, one of the best known names in British retail, faces unrelenting competition from supermarkets and discounters, fashion chains like Zara, H&M and Primark, as well as Amazon, while pressure on consumer spending is hampering efforts to revive its business.

Back in 2016, M&S embarked upon a five-year overhaul of its United Kingdom stores amid fierce competition from supermarkets and budget garment chain Primark - and particularly from online giants like Amazon.

Excluding the restructuring charge, the stores group's adjusted pre-tax profit was down 5.4% to £580.9mln from £613.8mln previous year, weighed by a 140 basis points drop in the food gross margin as a result of a weaker pound pushing up input cost inflation.

Revenue nudged up 0.7% to £10.7 billion.

M&S recently announced the next tranche of United Kingdom stores proposed for closure or set to close as it reshapes its United Kingdom store estate with plans to take at least a third of sales online.

"The first phase of our transformation plan, restoring the basics, is now well under way and the actions taken have increased the velocity of change running through our business".

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"These changes come with short-term costs which are reflected in today's results".

The move, which has been touted as part of a "radical transformation" plan by the retailer after years of falling sales, represents a "dramatic retreat from the United Kingdom high street that will trigger thousands of job losses" says The Guardian. "Accelerated change is the only option".

Sacha Berendji - retail, operations and property director at M&S - said "we are making good progress with our plans to reshape our store estate to be more relevant to our customers and support our online growth plans".

"There are a number of structural issues to address and we are taking steps towards fixing these", said chief executive Steve Rowe.

"The new organisation will largely be in place by July and the team is now tackling transforming our culture to make M&S a faster, lower cost, more commercial, more digital business".

Rowe said it was targeting sustainable, profitable growth in three to five years time.

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