Profit before tax at Marks and Spencer plummets 62.1%

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M&S wants to move a third of its sales online and plans to have fewer, larger clothing and homeware stores in better locations.

The shares were up 2.02pc at 297.7p mid-morning.

Pre-tax profit meanwhile dived more than 62 per cent to 67 million pound, while total sales firmed 0.7 per cent to 10.7 billion pound.

The company was particularly slow to get its online operations into gear and has admitted its website remains "slow".

The high-street chain which has a total of one thousand and thirty-five stores at the end of 2017-18 fiscal year, would be publishing its yearly results today.

Marks and Spencer-the British food-to-clothing retailer would be closing more than hundred "underperforming" United Kingdom stores in an ongoing reform, as was said on Tuesday.

M&S said its store closure programme would reduce costs by at least £250mln and provide a "platform for growth in later phases of our plan". In addition, the group is set to close 25 percent of its Clothing & Home space to as sales shift online and investing to increase and improve its commerce capacity to support its aim to double its online sales to more than 33 percent.

Marks & Spencer sees profits before tax decline 5.4 percent for FY18
Profit before tax at Marks and Spencer plummets 62.1%

In support of these changes, M&S expects capital expenditure of £350-400mln in 2019 but sees United Kingdom costs falling by up to 1% due to cost efficiencies and lower depreciation.

Free cash flow before adjusting items fell by 5.4% to £580.9mln from £613.8mln but net debt fell by 5.5% to £1.83bn from £1.93bn.

He added: "There are a number of structural issues to address and we are taking steps towards fixing these".

"This is vital as we start to leverage the strength of the M&S brand and values across a family of businesses to deliver sustainable, profitable growth in three to five years".

Marks & Spencer (M&S), one of the best known names in United Kingdom retail, first said it would reduce the amount of store space devoted to clothing and homewares in 2016, shortly after company lifer Steve Rowe became chief executive.

"We do not think the downgrade cycle may yet be over", said analysts at Liberum, maintaining their "sell" rating. It said it had not lost as many customers as expected when stores closed, making quicker and further closures viable.

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