In its results for the year ended 2nd April 2022, Marks and Spencer Group cites a "strong performance delivered by a more resilient M&S", combined with the initial benefits of the retailer's transformation strategy.
Profit before tax and adjusting items for the period was £522.9m (up from £403.1m in 2019/20), while statutory profit before tax was £391.7m (from £67.2m in 2019/20).
"The recovery of profit, combined with a focus on working capital and tightly controlled capital expenditure, generated substantial free cash flow and a sharp reduction in net debt," says the group, adding that the results included £59.8m of UK business rates relief and a net rates charge of £139.7m.
Clothing & Home delivered sales growth of +3.8% Yo2Y, with three consecutive quarters of underlying growth.
Online sales were up +55.6%, while store sales declined -11.2% (although there was some improvement in H2).
The retailer says its Home ranges have been reshaped, with "pricing realigned to the market" in areas such as bedlinen, lighting and curtains. It also says its furniture ranges are being upgraded, and losses have reduced.
There are at least 15 new stores planned over the next three years (including seven former Debenhams sites), which the retailer says will enable a further 32 closures.
CEO Steve Rowe says: "When I took over the reins at M&S six years ago, I committed to tackling the underlying issues that had eroded the strength of the business and building the foundations for future growth. For me, what is important about these results is not just the restoration of profit and strong cash flow – it is that they demonstrate that M&S has fundamentally changed. While there is much more to do, the business has moved beyond proving its relevance and has the opportunity for substantial future growth.
"It has been my privilege to be the steward and shopkeeper of this fantastic business and extraordinary brand at such an important stage in its history. The changes we have delivered are down to the commitment and hard work of colleagues across the business, and I am delighted to hand the baton on to Stuart, Katie and Eoin to lead the next phase (see related).”