Marks & Spencer PLC, a major British retailer, has widened its operating profit margin in the year to 28 February 2016. This is the first time since 2013 that the company’s operating profit margin increased.
The company also made a gain on its investment property however it announced lower-than-expected profits for the half-year period to 28 February. Marks & Spencer said that this came largely from weaker sales in Asia and North America.
Chief executive, Steve Rowe, said that the company was on track to deliver against its financial targets for 2016. The operating margin in the year increased by 2.1 per cent to £623m, up from £610m in 2014-15.
The retailer has announced a cost-saving plan of over £500m by 2019 to fund its turnaround and adapt to changing customer behavior.
Marks & Spencer sold its M&S Direct online shopping service to the UK retailer Argos for £50m in March 2016. This will allow customers to buy clothes, homeware and food directly from Argos, which is owned by Sainsbury’s PLC.
Marks & Spencer’s clothing sales fell 6.4 per cent in the half-year period, with UK like-for-like sales falling by 3.7 per cent and international like-for-like sales declining by 13.2 per cent .
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