British retailer M&S beats market forecasts

British clothing retailer Marks & Spencer (M&S) delivered its first sales increase in eight quarters and said profits…

British clothing retailer Marks & Spencer (M&S) delivered its first sales increase in eight quarters and said profits for the first half would be at the top end of market expectations.

Shares in the high-street icon hit a 3-1/2 year high in early trade, rising 3 per cent to approach the highly symbolic 400 pence level at which retail tycoon Philip Green pitched his abortive bid last summer.

In a second-quarter performance that outstripped most analysts' forecasts, M&S said same-store UK sales rose 1.3 per cent in the 12 weeks to October 1st, reversing a 5.4 per cent decline in the first quarter.

M&S has doubled its Irish outlets in the past year from four to eight stores.

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Total M&S group sales rose 3.3 per cent, with same-store sales in general merchandise - clothing and homewares - down just 0.2 per cent compared with an 11.2 per cent first-quarter decline. Same-store food sales were up 2.7 per cent.

Shares in M&S, which have made strong gains in recent weeks as analysts factored in an incipient recovery and on discredited market rumours that a management buyout was in the offing, opened at 395-1/5, valuing the company at £6.6 billion.