Marks & Spencer Share News (MKS)

Marks & Spencer (M&S) posted a 1.8 per cent rise in group sales in the third quarter, missing the UK retailer's expectations. In a trading update for the 13 weeks to December 28th, the company reported a 1.5% rise in total UK sales, down 0.2% on a like-for-like basis.Chief Executive Marc Bolland said an "exceptionally unseasonal" October saw like-for-like general merchandise sales fall by 2.1% despite heavy discounting in the struggling division which includes clothing.A 1.6% rise in like-for-like food sales and a 22.7% increase in online sales helped to mitigate the slump in general merchandise.The group achieved a new high in food sales of £64m on December 23rd, up 17% on the previous record in 2011.In the eight weeks to December 24th group sales were up 3.2%, total UK sales up 2.7% and like-for-like sales up 1%.During the period like-for-like food sales rose 1.5%, general merchandise grew 0.5% and online jumped 24.1%.International sales edged up 4.5% in the third quarter and 8.2% in the eight weeks to December 24th, driven by key markets in India and China.The company expects the full-year gross margin in food to be slightly ahead of the previous guidance of up 50 to 60 basis points. However, general merchandise gross margin is anticipated to be down 30 to 50bps as a result of promotions. All other guidance remains unchanged."Given continued pressure on disposable incomes, we remain cautious about the outlook." the company said. "Our focus is on continuing to transform Marks & Spencer into an international, multi-channel retailer."RD