StockMarketWire.com - Marks & Spencer booked a 62% fall in annual profit owing to restructure charges associated with store closures and a squeeze on margins in its food business.

Pre-tax profit fell to £66.8m, as revenue rose by 0.7% to £10.70bn.

Adjusted profit, which stripped out costs associated with store closures and other restructuring measures, fell 5.4% to £580.9m.

The company kept its full-year dividend flat at 18.7p per share.

'The first phase of our transformation plan, restoring the basics, is now well under way and the actions taken have increased the velocity of change running through our business,' chief executive Steve Rowe said.

'These changes come with short term costs which are reflected in today's results.'

Rowe said a new organisational structure will largely be in place in July, while the company was now tackling transforming the retailer's culture to make it a 'faster, lower cost, more commercial, more digital business'.

'This is vital as we start to leverage the strength of the M&S brand and values across a family of businesses to deliver sustainable, profitable growth in three-to-five years.'

The company announced on Tuesday that it planned to close 100 stores by 2022.

For the 2019 financial year, Marks & Spencer said it expected to reduce space in its clothing and home business by around 5%, with gross margins to increase by 50 basis points -- though the first half would be adversely affected by currency and sale timing.

In the food business, the company said it expected space to be broadly level, though gross margin would decrease by between 0 and 50 basis points, with the combination of price investment and the annualisation of input cost inflation in the first half of the year.

UK costs would fall by up to 1%, the effective tax rate would be around 22% and capital expenditure would be around £350-400m.





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