M&S not in recovery mode – yet

M&S not in recovery mode – yet

Marks and Spencer's (MKS) shares fell on the release of these half-year figures, despite slightly exceeding adjusted pre-tax profit forecasts. Consensus estimates expected to see £208m at the half-way stage, but M&S managed to add another £16m to this figure thanks to a timely drop in marketing costs. Full-year guidance from the retailer remains unchanged for now, but some City analysts – including house broker Shore Capital – are less convinced. Following a 2.9 per cent fall in like-for-like food sales – which was below expectations – and a 1.1 per cent decline in clothing and home revenues, analysts have trimmed FY2019 profit forecasts by 3 per cent. The broker now expects pre-tax profits of £528m for the year ending March 2019, giving earnings per share (EPS) of 25.1p, down from £581m and 27.8p in FY2018.

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