M&S Chairman And Chief Executive Departure

M&S Chairman, Luc van de Velde, has left the company as the directors of the British concern ousted the company's chief executive Roger Holmes and announced van de Velde's immediate departure.

In the wake of Philip Green's 9 billion bid for the retailer, Stuart Rose, the new chief executive who replaces Roger Holmes, will be on course to defend the firm against a possible takeover.

Mr Rose has been widely seen as the only man able to persuade shareholders to reject the bid from Mr Green. He said in a statement to the Guardian: "I didn't take the job to sell the business - my task is to bring M&S back to its former glory."

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1 June 2004-06-01

Philip Green To Bid For M&S

UK retail fashion entrepreneur Philip Green hopes to make Marks & Spencer the jewel in the crown of his high street empire. The City expects any successful bid to be pitched at around GBP400p-a-share, valuing M&S at around GBP10bn.

Green, owner of the Bhs and Arcadia chains, has set up a new company to draw up a bid for M&S, Revival Acquisitions. A statement to the Stock Exchange confirmed that Revival "intends to approach M&S in the next few days with its proposal and to seek a recommendation".

The statement said that any proposal "would involve a mixture of cash and shares in a new company which would seek a listing". That changes Green's previous takeover strategy, which has seen Bhs and Arcadia delisted from the stock exchange and run as private companies. The part-share offer, giving a continued stake in the business, should help reassure investors that they are not selling short to a buyer with a reputation for bargain hunting.

M&S has seen sales of both clothing and food decline again over recent months, as the recovery programme initiated by chairman Luc Vandevelde falters. The company conceded this week that its latest recovery tactics, which include a store revamp programme spearheaded by general merchandise director Vittorio Radice, will take some time to make an impact.

The business is also vulnerable while it seeks a replacement for the departing Vandevelde, who is expected to take the chair at French retailer Carrefour later this year.

A formal bid would be certain to attract the interest of the competition authorities, but Green could argue that the intense competition from retailers ranging from Next and Debenhams to Asda and Tesco would continue to work in consumers' interests.

Green's move is likely to flush out any other potential bidders for M&S, which could include other retailers as well as private equity players. Despite its faltering sales, M&S remains the UK's biggest high street retailer and this week reported profits up by 6 per cent toGBP805m in the year to April 3, on turnover of around GBP8.3bn.

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28 May 2004

M&S Warned Vandevelde Position Unsustainable

According to the Financial Times, the board at Marks and Spencer was warned over 18 months ago that Luc Vandevelde's position as non-executive chairman was unsustainable due to a big pay package but having many outside commitments.

Tony Ball, who at the time was a non-executive director of the flailing retail group, told board members that Mr Vandevelde's GBP450,000 a year package would lead to problems. His position was over-ruled, however, and he chose to resign over the issue in September 2002.

"Tony did not agree with Vandevelde's package and the ability it gave him to do lots of other things," as was quoted in today's FT. "He thought there would be clear conflicts, and felt that wasn't what M&S needed at that time. And his salary wasn't reflective of the amount of time he would be spending there."

Vittorio Radice, the M&S's head of clothing and home and store design, has stated Mr Vandevelde's departure would be a distraction, but refused to be drawn on whether the group needed a City grandee or a retailer as replacement. "We need the very best person we can get," he said.

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12 May 2004

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New Director of Womenswear At M&S

Marks & Spencer Group has appointed Kate Bostock as director of womenswear, to reignite the spark in its clothes sales for the high street giant.

Bostock is currently product director of the successful George brand at Asda, where since 2001 she has been responsible for clothing and footwear at the supermarket chain. In her new role she will report to general merchandise director Vittorio Radice. Steve Longdon, currently M&S director of womenswear, leaves the business at the end of the month.

14 May 2004
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Luc Vandevelde To Leave M&S Board

Marks & Spencer chairman Luc Vandevelde is to leave the UK retailer. In a recent statement it was said: "a search is under way for a new chairman and Luc will remain in post for as long as necessary to establish his successor."

M&S said Vandevelde's decision has been prompted by personal commitments to the Halley family following the death of Paul Louis Halley last year. The Halley's are a major shareholder in French supermarket chain Carrefour, with Vandevelde representing their interests on the board.
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With M&S now once again seeing sales slipping, there has been widespread concern among M&S shareholdrs that Vandevelde's part-time role and outside interests do not allow him to commit enough time to the business. As well as Carrefour, he is on the board of Vodafone and runs private equity business Change Capital.

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10 May 2004

M&S Should Rethink High Street Strategy

Sales figures released by Marks & Spencer last Wednesday have prompted some to rethink its high street strategy. Clothing sales for the retailer were down 2.5 per cent in the first three months of 2004, with home sales declining by 13.7 per cent. Speculation also has it that some 1,000 jobs are being cut at Marks' headquarters as it struggles to match its cost base to its spiralling earnings.

Retail analyst Richard Ratner at Seymour Pierce in London recently told a Scottish daily that M&S could learn from Swedish retailer Henner & Mauritz. Ratner stated: "Marks & Spencer's first problem is their pricing architecture, they have too much expensive stuff. You can sometimes get away with that, providing it's the right product, but you still need a competitive price point to tease people in. H&M are very good at that. M&S is not."

H&M is much more flexible in buying from its suppliers, he says - the company will do more to get better prices. M&S is targeting a 1 per cent per annum cost reduction for the next three years. But it is still not buying as competitively as H&M.

H&M's customer, as Ratner states, is younger and more trend focussed than at M&S. The British retailer will always sell to middle-age, middle-Britain. What M&S hasn't quite realised is that the market is trending downwards age wise.
"The 80-year olds want to look like they're 60, the 60-year-olds like they're 40, and the forty-somethings like they're 25. "

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19 April 2004

Recovery For M&S Stalled By Sales Slump

The recent management changes, brand rejuvenation strategies and product and store modernisation at Marks & Spencer have not had the impact on sales as expected by the high street retail giant. Instead, the company has reported a drop in sales on both the first quarter and on the year to date.

In the first quarter, total sales were down 0.1 per cent and like-for-like sales down 3.4 per cent. Marks & Spencer chief executive Roger Holmes said: "Sales this quarter are clearly not good enough. We are taking action on a number of fronts to accelerate the transformation of the business and deliver improved performance."

The road to recovery will not be easy, as the group is proposing to offer a more fashionable product and modernise its store concept. Cutting costs will have to be re-examined on all aspects from head office and management to supply chain and operations.

Operating as a store able to offer all things to all people is becoming more and more challenging as the high street is growing more specialised. Bringing in former Selfridges boss Vittorio Radice to launch its move into the home market and revamping the groups stores nationwide has sparked a fear the group's spending could spiral, although the changes will be implemented over a number of years.

While the consumer's confidence may remain intact, Marks & Spencer's sales figures indicate that the recovery it has long-awaited for is not just around the corner.

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14 April 2004

M&S To Cut 1000 Jobs

Marks & Spencer is aiming to cut 1000 head office jobs. The 58,000 store staff jobs are said to not be affected, the cuts will be focussed at four UK locations over the next two years, saving GBP25m a year of costs in the process.

The job losses stem from a review of M&S's head office and financial services operations, which aims to put the focus on customers. The UK high street retailer has been criticised for being top-heavy with bureaucracy.

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5 April 2004

M&S On Lookout For New Chairman

In a highly competitive high street clothing market, Marks & Spencer is trying to hold on to its niche and market share and is on the lookout for a non-executive director to add to its strength. The primary reason the company is looking for an additional board member of suitable seniority is that there is no replacement should current chairman Luc Vandevelde leave M&S.

Mr Vandevelde has been criticised by some investors of late for his appointment to the board of Carrefour, the French hypermarket chain. His pay-packet has grossed to GBP6.8m since his appointment in February 2000.
Given that Mr Vandevelde is also managing director of venture capital group Change Capital Partners, institutions fear he may be spreading himself too thin.

When home director Vittorio Radice was appointed as the head of general merchandise, it was generally insisted that the chairman remained "committed" to M&S. Since last September, Mr Vandevelde, a Belgian national, has been paid in company shares.

The company's senior non-executive director is Brian Baldock, who turns 70 in June, and has served on the board since 1996. Along with Dame Stella Rimington, who chairs the remuneration committee and is 69 this year, Mr Baldock was on the board when the non-executives failed to tackle the succession crisis in 1998. Mr Baldock chairs the nomination committee.

Since Dame Stella has been on the board since January 1997, both breach Higgs' recommendation of non-executives serving two three-year terms.

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22 March 2004

Nigel Hall Signs To M&S Autograph

Designer Nigel Hall is the lastest addition to be named in the Marks & Spencer Autograph fashion directory. With his first collection due this October, Hall, who is best classified as a menswear casual designer, the range will be focused around knitwear, trousers and shirts.

It has further been rumoured that Alice Temperley has been approached by the group to design a new women's range for Autograph.

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17 March 2004

Radice New Executive For Fashion At M&S

Marks and Spencer announced last week that Vittorio Radice is to become the Executive Director for General Merchandise, responsible for Clothing, Home and store development.

Chief Executive, Roger Holmes said: "The appointment of Vittorio to this new role is absolutely the right choice at the right time. Vittorio is acknowledged as an outstanding retailer with an ability to be bold and to transform our offer to customers, as he has shown with the launch of Marks & Spencer Lifestore."

The Company is also announcing the appointment of Mark McKeon to the newly created Board position of Executive Director of Retail, International and Outlets.

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11 March 2004

M&S To Launch Quality For Less

Marks & Spencer is planning to launch a 'quality for less' range in 150 stores. The collection, being developed under the working title of Project 150, will be pitched between M&S's own-label range and its Autograph brand. The quality for less promise means M&S and its suppliers will bear the increased costs for fine materials such as 100 per cent luxury wools.

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24 February 2004

Revitalised Ranges Suit M&S

Aiming to convince the City that it addressing the problems that hit womenswear sales in the run-up to Christmas, M&S hosted a visit to it flagship Marble Arch store in London, to show how its revitalised spring and summer ranges are translating in to sales.

The boys from the banks were largely convinced, with M&S's share price closing the week up 9p to 278.75p.The main question mark was over price, with some questioning whether an average 3.5 per cent drop in womenswear prices will be enough in the face of fierce discounting on the high street.

There was evidence that M&S shares the concerns, with the Daily Telegraph reporting that analysts saw evidence that prices on some spring/summer womenswear lines by more than it intended when the range was launched in November. Some price tags had been removed and replaced with lower prices printed manually with a price gun.

Tony Shiret, analyst at Credit Suisse First Boston, said in a research note: "Our view of this morning's visit is that M&S will be able to show it has changed its presentation to address some of the criticisms of the autumn/winter 2003 ranges, but we have found signs of early season demand weakness that suggest that there is an increased threat to profit forecasts."

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9 February 2004

M&S Tailoring To Expand

Marks & Spencer will roll out its SP tailoring range from 30 to 100 stores for spring 04 as the retailer seeks to develop what it calls its "lads who are dads" SP sub-brand.

SP was introduced in all M&S stores in September, and the company has picked suiting as one of the areas with the biggest growth potential. M&S head of buying men's clothing Julian Kilmartin said: "SP has started well, which has given us a lot more confidence for the second season. More and more ideas are filtering down from the Autograph designer range into SP - it can be seen in the cut and attention to detail in the jackets."

The suits are cut to a slimmer fit than classic M&S tailoring and striped linings also give the jackets a younger feel. Four 2sb suits will be available at GBP99, in a wool blend. Unusually, for that price point, the suits target the 35-year-old core SP customer.

The range as a whole is more fashion forward, with emphasis on printed T-shirts, casual jackets and retro-styled sportswear.

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11 December 2003

M&S Searches For Head Of Menswear

Marks & Spencer is casting its net as wide as possible in its determination to find a head of menswear. The post is vacant due to internal promotion.

Some leading candidates have turned down the role, despite a salary expected to be in the region of GBP300,000. One source said M&S was having problems in keeping senior managers happy and there was frustration at the political in-fighting there.

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10 December 2003

Marks & Spencer To Focus On Fashion

Stagnant Sales and uninspiring collections have rung a bell at Marks & Spencer, which admitted it needs to work harder to get its full fashion ranges into all its stores. The high street giant has been hit by lacklustre sales of its autumn and winter womenswear ranges. Yasmin Yusuf, Marks & Spencer's creative director for clothing, said the business needs to do more to get its full women's ranges into smaller stores, as well as to improve presentation across all stores.

As a result, customers in some areas have not benefited from the uplift in the M&S offer generated by more fashionable ranges such as per una, designed by George Davis. As the company launched its 2004 spring/summer womenswear range, Yusuf said: "As a brand we have moved on, but we have not taken enough newness all the way through to our smaller stores.

"Even our smaller stores are often the largest on a high street and shoppers will want to see a fashionable range."

20 November 2003
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Marks and Spencer Buys Back Own Shares

Since the 5th of November, Marks and Spencer Group p.l.c .has announced that it has purchased for cancellation 5,000,000 of its ordinary shares from Cazenove & Co. Ltd. The price per share averages 284.5342p per share.

14 November 2003
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Marks & Spencer Introduces Organic Clothing Line

With public awareness being raised on issues such as food consumption, ethical trading standards, and global welfare, the need for organic clothes is on the rise and consumers have a new demand for all things "natural." What you wear, is now as important as how you wear it.

In line with this, View From, the performance sportswear brand from Marks & Spencer, is launching a new range of organic cotton yogawear.
This new range follows on from the successful launch of View From's 'Mind & Body' yoga and pilates collection and is produced using Agrocel® Pure & Fair cotton by Gossypium.

The five piece collection has been designed to meet the needs of a wide range of people taking up forms of exercise that nurture the mind and spirit as well as the physical self. The cotton is produced in an ethical way and is directly traceable back to the farmers, and with every purchase made, Marks & Spencer will give 1% of the purchase price back to the Agrocel® Pure & Fair Cotton Project in rural India.

This fair trade project is dedicated to increasing the scope of organic farming towards a healthier soil and society for the small scale farming community.

The collection is available from January from selected stores around the UK and from M&S Direct

3 November 2003
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Marks & Spencer Go Organic

Marks & Spencer is launching its first 100 per cent organic cotton collection under the banner of its exclusive sportswear brand View From.

The five-piece yoga wear range is produced using Agrocel Pure & Fair cotton and is the result of "ethical" production processes, which, by minimising third party involvement, aim to be as transparent as possible.

The range's production supply chain is traceable from the retailer back to individual cotton farmers in India.

Marks & Spencer is further understood to be researching the possibility of following in Nike's footsteps and using a blend of organic and non-organic cotton in some garments.

14 October 2003
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M&S Loses Schoolwear Market Share

Mars & Spencer is no longer the UK's largest schoolwear retailer by value, according to figures quoted by The Times. M&S's market share fell from 9.7% to 9.1% as Asda's leapt from 9.3% to 12%. Woolworths was another strong performer, moving up to third place with a rise from 5.3% to 7.5%, swapping places with Bhs, which fell from 6.4% to 5.4%.

9 October 2003
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Marks and Spencer Anchor Store at White City

Marks and Spencer is to be the anchor store at a major new development in the White City area of west London. The retailer plans to open at property company Chelsfield's White City development when the retail scheme opens in autumn 2006.

Chris Williams, property director at Marks & Spencer said: "We are constantly striving to shape our store locations to meet the changing needs of our customers.

"An in-depth review of West London undertaken earlier this year identified an untapped opportunity in West London. We have therefore agreed terms to secure an anchor store at The White City Development.

"We are delighted to be part of this important scheme, which we believe will be one of the leading retail offers in the UK. The store would provide our customers with an inspirational shopping experience and a great alternative to our surrounding offer in the West End and the outer M25."

12 September 2003
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M&S To Source Shoes From India

Marks & Spencer has made India its source for a fourth of its shoe stocks. This requirement of footwear is now being sourced through Graziella Shoes, a 50:50 joint venture between Tata International and Pucci Dante of Italy.

According to Tata International, Graziella's main customers are Clarks and Marks & Spencer. Nearly 25 per cent of the global purchase of men's shoes of Marks & Spencer is now sourced from Graziella.

Its manufacturing unit located in the Chennai export processing zone caters mainly to the UK market.

The company has been exporting high-quality and fashionable leather products across the world for the last 25 years. Tata International in recent years entered the domestic footwear market under the brand name Stryde.

2 September 2003
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Olympic chief plays for M&S

Marks and Spencer Group has appointed Barbara Cassani chief of London's 2012 Olympic bid, as a non-executive director.

Cassani is chairman of London 2012, which is developing London's bid to bring the Olympic Games to the capital. She will take up her new role with the UK's best known high street retailer in October.

Cassani said: "Marks & Spencer is one of the great British brands. I am delighted to be given the opportunity to join the board. I look forward to encouraging new ideas that will strengthen connections with the customers."

August 13 2003
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M&S Too Hot on the High Street

Retailers had a difficult April and May, and while June proved good for sales as the warm weather inspired shoppers to indulge on the summer fashions, it may be too hot on the high street for Marks & Spencer.

Marks & Spencer, who released the first quarter figures last week, could interpret their core clothing business as showing a loss of market share. M&S's growth stalled in the final quarter of last year, and many had been hoping the first quarter would see a resumption of expansion.

Roger Holmes, chief executive, told the Financial Times the he is fairly certain that market share was broadly flat. Analysts reckon that clothing enjoyed like-for-like growth of 3 per cent, with the market as a whole up by about 3.5 per cent.

It is all a reminder that, while M&S may have come a long way from its darkest days, fierce competition means it is never likely to regain the high street prominence of old and its traditional share price premium to the sector may not be that deserved.

21 July 2003
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M&S posts 5.4% jump Q1 sales

Marks & Spencer on posted a 5.4 per cent jump in first quarter sales from the year-ago period, which as it was boosted by increased demand for its fashions.

Britains largest clothing retailer said same-store sales rose 3.8 per cent in the 15 weeks to July 12 with sales in the apparel and footwear division up 3.9 per cent from the same period of 2002.

M&S revealed its clothing performance was driven by a three per cent increase in volumes but admitted childrenswear sales, which include the David Beckham-backed DB07 range, continued to under-perform.

Chief executive Roger Holmes said: "We had a satisfactory first quarter in which we saw an improvement in clothing performance, particularly in June, with good food sales throughout the period."

He said "sales progress has been made in adult clothing, particularly in Per Una, together with improved performance in women's and men's formalwear", adding "childrenswear continues to under-perform although there have been some signs of progress".

"We are still expecting the retail market to be relatively subdued, particularly in contrast to a year ago," he continued.

"When we talked last time about expecting the clothing market to grow in a range of one to three per cent for this year I don't see any reason to change that."

July 17, 2003
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