M&S sales bounce back over Christmas period under new boss

Marks & Spencer (Frankfurt: 534418 - news) 's sales delivered Christmas cheer to the retailer for the first time in six years after an overhaul under its new boss Steve Rowe.

Shares (Berlin: DI6.BE - news) rose after M&S reported a better-than-expected 2.3% third quarter increase in like-for-like sales for its beleaguered clothing and home division, while food climbed by 0.6%.

The performance for the 13 weeks to 31 December was partly flattered by comparison with a dismal Christmas performance in 2015 and a change to the sales reporting period.

But it was enough to cheer investors nine months after Mr Rowe took over as chief executive following a string of disappointing results under predecessor Marc Bolland. Shares rose 2%.

General merchandise at M&S had not seen a Christmas like-for-like sales rise since the 2010/11 financial year while the only quarterly increase since then came in the fourth quarter of 2014/15.

The update came as a slew of high street retailers revealed Christmas trading figures, broadly painting a positive picture for the sector - including a 2.7% uptick for department store John Lewis.

Mr Rowe hailed a "great Christmas" and said the improvement was down to the overhaul of M&S he launched after taking over in April.

He said: "In clothing and home, better ranges, better availability and better prices helped to improve our performance in a difficult marketplace."

The chief executive also said M&S had cut back on periodic discounting, including over Black Friday.

Instead it has been reducing everyday prices on more than 2,000 products to lure customers back.

Mr Rowe warned that the next set of quarterly results would be adversely affected by the timing of sales and a late Easter.

He added that the group would plough on with its restructuring plans "against the background of uncertain consumer confidence".

M&S said in November that it planned to close around 30 UK stores and convert 45 more into food-only shops, while also announcing a retreat from a raft of international markets.

The latest update shrugged off gloom last week from rival Next (Frankfurt: 779551 - news) , which issued a profit alert after dismal Christmas trading.

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