Marks and Spencer is planning to close 30 more of its stores after struggling with sales amid the Covid-19 pandemic.
The retailer suffered a £201 million pre-tax loss for the year to 27 March, compared to a £67 million profit the year before.
30 planned closures
M&S said it is targeting 30 more closures in the “next phase” of its long-term transformation plan, which will be part of a shake-up of around 110 stores, the majority of which will be set for relocation.
It has already closed or relocated 59 of its stores, but is planning to accelerate the changes to its portfolio of shops following the significant losses made amid the pandemic.
The retailer said the impact of the current health crisis has provided a strong opportunity to purchase new locations, and the group is currently targeting six new stores in former Debenhams units.
At the moment, the retail group has 254 full-line stores, which sell food and clothing, but this is due to be cut to around 180 stores over the next 10 years.
The plans include replacing some of these stores with food-only or purely clothing and home sites instead.
£201 million loss
The announcement of further closures comes as the group plunged to a £201.2 million pre-tax loss for the past year, after sales struggled due to the tough lockdown restrictions which saw stores forced to close for several months.
The group told shareholders that total revenues dropped after this slump offset an improvement in its food operations.
M&S reported that food like-for-like revenues increased by 1.3 per cent over the past year, but its clothing and home business reported a 31.5 per cent drop, despite an online growth of 53.9 per cent.
Clothing and home operations saw a £129.4 million operating loss, although the retailer said the performance did improve in the second half of the year. These sales have also returned to growth since the reopening of all stores in England on 12 April.
The company said it was buoyed by its food business, which saw 6.9 per cent growth excluding its hospitality and franchise arms, and 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 added that it expects to be hit by between £42 million and £47 million in Brexit costs for the current year, particularly affecting its business in the Republic of Ireland and Northern Ireland.