Marks & Spencer has said its turnaround plan is working as the retailer upgraded its profit targets after strong food and clothing sales.
Shares soared after the high street stalwart said it is on track to surpass the top end of its previous profit guidance of £300 million to £350 million for the year.
M&S said it believes the performance provides “strong confirmation” that it has benefited from its Never the Same Again overhaul programme, which has seen the group axe dozens of stores.
The firm said it was also boosted by pent-up consumer demand since reopening its clothing and home stores following lockdown measures.
“There remains substantial uncertainty as to the continued strength of consumer demand, as well as disruption in both supply chains and consequent pressures on costs and margin,” it added.
The retailer said it was buoyed by a 10.8% jump in food sales for the 19 weeks to August, with this also 9.6% up on the same period in 2019.
It said its food stores on retail parks have performed particularly “strongly”, while its hospitality and franchise sites are improving but remain below 2019 levels due to weaker footfall.
Cost reduction programmes across the food division have also helped to offset cost inflation, supply disruption and the cost of increased staff absences, M&S added.
Meanwhile, clothing and home sales were 92.2% ahead of last year’s pandemic-hit levels and down 2.6% on the period in 2019.
The retailer said it has seen a jump in full price sales against pre-pandemic levels after making its ranges more focused, reducing promotions and selling a substantially smaller summer range as part of its strategy shake-up.
Store sales are almost a fifth below pre-pandemic levels amid the shift to greater online activity, with many locations reporting a “slow recovery” in footfall.
Shares soared by 11.4% to 158.95p in early trading on Friday.
