Marks & Spencer (M&S) has made a series of announcements, which include UK store closures, predicted declines in sales and its plans to fully pull out of the Russian market following the invasion of Ukraine.
The retailer is to close more than 32 stores in the UK, stating that the reason for the closures were down to the “lost impetus” of the town centre.
As part of the announcement, M&S reported pre-tax profits of £392 million for the year to 2nd April 2022. This is up from a loss of £209 million in 2021. It said it had seen a strong performance as grocery sales were up by 10.1%.
However, the retailer said it expected sales growth to slow due to soaring production costs and the increased pressure on customers’ budgets.
Increased food costs, driven by global supply issues and labour shortages; factory, transport and freight costs; and continued supply issues in China are putting pressure on the business.
In March, M&S stopped shipments to Russia but previously stated that “complex franchise deals” were preventing the retailer from fully withdrawing from the country. It is estimated that a decision to fully exit Russia will cost M&S around £31 million. Following further negotiations, the company has confirmed it will fully exit the market.
