Suffolk stores under threat as M&S announces 30 closures
- Credit: Archant
Marks & Spencer has announced it will close 30 branches after making a £201million loss — putting the future of Suffolk's stores in doubt.
The retailer, which has stores in Ipswich and Bury St Edmunds, said the loss was a result of the high street lockdowns.
It has already closed or relocated 59 stores - including its Felixstowe clothing and food store, which still stands empty - but said it is accelerating changes to its portfolio of shops following the impact of the pandemic.
The 30 planned closures will be part of a shake-up of around 110 stores, with the majority of these sites set for relocation.
A spokesman for the company said the company had not yet made any announcements around specific store closures.
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M&S said the impact of the pandemic has provided it with a strong opportunity to purchase new locations, with the group currently targeting six new stores in former Debenhams units.
The group currently has 254 full-line stores, which sell food and clothing, but it plans to reduce this to around 180 over the next 10 years, with some of these being replaced by food-only or purely clothing and home sites.
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The update came as M&S tumbled to a £201.2m pre-tax loss for the year to March 27 after its clothing and home business was particularly hammered by pandemic restrictions
It follows a £67.2million statutory profit in the previous year.
The group told shareholders that total revenues dropped after this slump offset an improvement in its food operations.
It reported that food like-for-like revenues increased by 1.3% over the past year but the company saw its clothing and home business report a 31.5% slump despite 53.9% online growth.
Clothing and home operations saw a £129.4million operating loss, although M&S said the performance improved in the second half of the year.
These sales have also returned to growth since the reopening of all stores on April 12, M&S said.
Meanwhile, the company said it was buoyed by its food business, which saw 6.9% growth excluding its hospitality and franchise arms.
It also hailed a strong integration with Ocado after the two companies launched their online grocery joint venture last September.
The retailer said its balance sheet is also “stronger than expected” following the impact of the pandemic.
Steve Rowe, chief executive at Marks & Spencer, said: “In a year like no other we have delivered a resilient trading performance, thanks in no small part to the extraordinary efforts of our colleagues.
“In addition, by going further and faster in our transformation through the Never The Same Again programme, we moved beyond fixing the basics to forge a reshaped M&S.
“With the right team in place to accelerate change in the trading businesses and build a trajectory for future growth, we now have a clear line of sight on the path to make M&S special again.
“The transformation has moved to the next phase.”
The group also said it expects to be hit by between £42million and £47million in Brexit costs for the current year, particularly affecting its business in the Republic of Ireland and Northern Ireland.