(MENAFN- AFP) British clothing-to-food retailer Marks & Spencer reported a collapse in annual net profits on Wednesday, hit by a costly restructuring.
Bottom-line net profit tumbled almost 80 percent to £24.7 million ($33 million, 28 million euros) in the group's financial year to March 31, M & S said in a statement.
That compared with profit after taxation of £117.1 million a year earlier.
Pre-tax profit meanwhile dived more than 62 percent to £67 million, while total sales firmed 0.7 percent to £10.7 billion.
The performance was dented by £321.1 million in costs linked to the retailer's ongoing store closure programme in Britain.
"In November I outlined the need for accelerated change at M & S," said chief executive Steve Rowe.
"The first phase of our transformation plan ... is now well under way and the actions taken have increased the velocity of change running through our business.
"These changes come with short-term costs which are reflected in today's results."
The company also warned that its website was "too slow", adding it was lagging behind online competitors.
The results were published one day after M & S revealed it will shut more than 100 "underperforming" UK stores in total.
The high-street chain, which has already shut 21 branches as part of the overhaul, on Tuesday expanded its closure plans as it aims to shift at least a third of sales online.
The London-listed giant did not specify the number of job losses -- but thousands of positions are believed to be at risk, according to media.
Back in 2016, M & S embarked upon a five-year overhaul of its UK stores amid fierce competition from supermarkets and budget garment chain Primark -- and particularly from online giants like Amazon. The restructuring was accelerated last last year.
"In the last year traditional retailers like Marks have faced a perfect storm of rising costs, a constrained consumer, and the relentless growth of online competition," said Hargreaves Lansdown analyst Laith Khalaf.
The retailer had a total of 1,035 UK stores at the end of its 2017/2018 financial year.
MENAFN2305201801430000ID1096897914
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.