Marks & Spencer swings to a loss for the first time in almost a century.
The British multinational reports revenues of 4.09 billion pounds in the first half.
The retailer’s board of directors is refraining from paying a dividend on Wednesday.
In a report on Wednesday, Marks & Spencer Group plc (LON: MKS) said it had closed the first half of the current year with a pre-tax loss. It was the first time in almost a century that the retailer had become a loss-making business.
The company’s shares rose by about 2.5% in pre-market trading on Wednesday. At 94.82 pence per share, Marks & Spencer’s share price on the stock exchange is now almost 55% down on the previous year’s result. The company is still trading near its low for the year to date of 86 pence per share at the end of May. Confused about choosing a reliable stockbroker for online trading? To make it easier for you to choose, here is a comparison of the few providers.
Marks & Spencer reports turnover of £4.09 billion in H1
In the first week of August, UK online supermarket Ocado closed its £750 million deal with M&S to transform its online food business into a joint venture.
Marks & Spencer said it had suffered a pre-tax loss of £87.6 million in the six months ended September 26. This compares with a profit of £158.8 million in the same period last year.
In terms of revenue, Marks & Spencer recorded £4.09 billion in the first half compared with £4.86 billion in the same period last year. The company’s board of directors on Wednesday decided not to pay a dividend to help cushion the economic blow of the COVID 19 crisis, which has so far infected more than one million people in the UK and killed over 47 thousand.
The Marks & Spencer statement on Tuesday
According to Marks & Spencer:
“There is still considerable uncertainty regarding the short-term outlook for both coronavirus and brexite. Trading in the first four weeks of the second half continued at rates similar to those at the end of the second quarter, with food retail revenues up 3.0%, apparel and home sector revenues up 21.5% and international revenues up 7.4%.
The London-based retailer said in an August announcement that it would cut a further 7,000 jobs to support its finances amid the ongoing health crisis.
Marks & Spencer has been deaf to the stock market for the past year with an annual decline of almost 10%. At the time of writing this article, the UK multinational retailer has a market capitalisation of £1.90 billion and a price-to-earnings ratio of 78%.