Investors urge M&S to show brand is future-proof

Digital sales at M&S have been improving, but may not be enough to offset a fall in in-store takings
Digital sales at M&S have been improving, but may not be enough to offset a fall in in-store takings
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Investors will be looking for evidence that Marks & Spencer’s online sales growth is accelerating when the retail giant reports full-year results this week.

George Salmon, equity analyst at Hargreaves Lansdown, said that although digital sales have been improving, the growth hasn’t so far been enough to offset a fall in in-store takings.

“M&S needs to prove it can grow online if investors are to believe the brand is future-proof,” he said.

Shareholders will also be hoping the group has been able to stem the fall in sales at its food arm where January’s third-quarter results showed the eighth consecutive year-on-year, like-for-like drop. The group recently announced plans to take a 50 per cent stake in Ocado’s food retailing business, although it won’t be getting the full benefits until well into 2020. Russ Mould at AJ Bell said analysts will want more detail on the planned £600 million rights issue to help fund the Ocado deal.