M&S to ask for more time as clothing sales keep falling
By James Davey
LONDON (Reuters) - Marks & Spencer (MKS.L: Quote) is set to report a ninth straight quarterly fall in underlying clothing sales, with the firm likely to say it is too soon to see the full impact of a new general merchandise team and much vaunted new season ranges.
Britain's biggest clothing retailer, which also sells homewares and food, publishes second-quarter sales on Tuesday and also reports first-half results expected to show a 12 percent fall in pretax profit - down for the third year running.
"We will be pleased and relieved if we can retain our full-year forecasts intact," said Shore Capital analyst Clive Black.
The 129-year-old group, which serves 21 million customers a week from nearly 770 British stores, is forecast to report a fall in sales of general merchandise - clothing, footwear and homewares - of 0.4 percent to 2.5 percent from shops open over a year in the 13 weeks to September 28, its fiscal second quarter, according to a company poll of 13 analysts.
The average forecast for a drop of 1.5 percent is little changed from a first-quarter decline of 1.6 percent.
Though the autumn/winter ranges - the first from a clothing team led by John Dixon, the former boss of M&S food - hit M&S shops on July 25, the full launch, together with a high-profile advertising push featuring some of Britain's biggest female celebrities, did not kick off until September.
M&S is expected to say the second-quarter outcome will reflect the impact of continued pressure on consumers' disposable incomes, a highly promotional trading environment, as well as a sustained and mild autumn in the UK - not helpful for shifting high-margin winter coats, jumpers and boots.
The firm will, however, take comfort from the latest market share data from Kantar Worldpanel, leaked to Retail Week, showing it held its overall share of the British clothing market in the 24 weeks to end-September Continued...