Marks and Spencer Group (LON:MKS) Posts Quarterly Earnings Results

Marks and Spencer Group (LON:MKS) announced its earnings results on Wednesday. The retailer reported GBX 23.80 EPS for the quarter, Digital Look Earnings reports. Marks and Spencer Group had a net margin of 0.13% and a return on equity of 0.69%. The company had revenue of GBX 1,727.36 billion for the quarter.

Here are the key takeaways from Marks and Spencer Group’s conference call:

• M&S said it is entering a new phase of “reinvesting for growth,” with capital spending set at GBP 650 million to GBP 750 million this year across stores, supply chain, and digital/technology.
• Food was the standout performer, with sales up 7% and market share rising to a record 4.1% (or 4.6% including Ocado), while management said the business has the potential to double sales over time.
• Fashion, home and beauty had a difficult year, with sales down 7.7% and operating margin falling to 5.5% from 11.3%, though management said performance improved in the fourth quarter as availability recovered.
• The company highlighted strong progress on cost control, saying its structural cost-out program has delivered about GBP 390 million of savings so far and remains on track to reach GBP 600 million by FY2028.
• Adjusted profit before tax fell to GBP 671.4 million and free cash flow from operations was GBP 131 million, with the cyber incident still weighing on the year, although M&S ended with a net funds position excluding lease liabilities and said profits grew in the second half.

Marks and Spencer Group Stock Performance

LON MKS opened at GBX 342.10 on Wednesday. The firm’s fifty day moving average price is GBX 342.90 and its two-hundred day moving average price is GBX 352.97. The stock has a market cap of £6.93 billion, a PE ratio of 380.11, a PEG ratio of 0.20 and a beta of 1.02. Marks and Spencer Group has a fifty-two week low of GBX 301.10 and a fifty-two week high of GBX 411.80. The company has a debt-to-equity ratio of 121.22, a quick ratio of 0.42 and a current ratio of 0.81.

Wall Street Analysts Forecast Growth

Several research analysts have recently commented on MKS shares. UBS Group reaffirmed a “buy” rating and set a GBX 425 target price on shares of Marks and Spencer Group in a report on Monday. Jefferies Financial Group reaffirmed a “buy” rating and set a GBX 440 target price on shares of Marks and Spencer Group in a report on Tuesday, March 10th. Citigroup lowered their target price on shares of Marks and Spencer Group to GBX 430 and set a “buy” rating on the stock in a report on Thursday, March 19th. Finally, Shore Capital Group reissued a “house stock” rating on shares of Marks and Spencer Group in a research note on Monday, May 11th. Six equities research analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the company’s stock. According to MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and a consensus price target of GBX 415.

Marks and Spencer Group Company Profile

M&S has a heritage of quality, innovation and value for money and has been voted the UK’s most trusted brand. From these foundations, M&S is reshaping for sustainable profitable growth and value creation.

We operate as a family of businesses, selling high-quality, great-value, own-brand products and services, alongside a carefully selected range of third-party brands. We do this through a network of stores and websites globally, and together, across our stores, support centres, warehouses and supply chain, our 65,000 colleagues serve over 30 million customers each year.