Marks & Spencer Share News (MKS)

Like for like sales growth at high street bellwether Marks and Spencer's UK stores were well ahead of market expectations in the third quarter.UK like for like (LFL) sales had been expected to be up year on year by anywhere between 1.3% and 4.6%; Marks & Spencer (M&S) delivered a 5.3% increase in the 13 weeks to 2 October.LFL sales on the general merchandise side of the business rose 7.0%; KBC Peel Hunt, one of the more optimistic brokers about M&S's prospects, had predicted an increase of 4.5%.Food sales saw a 3.7% LFL sales increase, topping Peel Hunt's prediction of a 2.5% increase and Panmure Gordon's forecast of a 1.75% rise.Total UK sales were up 6.5%, with general merchandise up 8.0% and food up 5.2%. Within the general merchandise division clothing sales surged 7.8% and homeware soared 9.3%.Group sales, which includes overseas stores, rose 6.5%. International sales were up 6.2%, as a result of improved performance across most markets although the trading conditions remain difficult in Ireland and Greece."Marks & Spencer has had a good second quarter, growing market share across all parts of the business. Customers are returning to quality. In Food they are responding well to our better value and innovation, and in Clothing are increasingly choosing M&S's great fashions and quality that lasts," said Marc Bolland, the chief executive M&S poached from supermarket chain Morrisons at great expense.Clothing market share rose by seven-tenths of a percentage point to 10.3%, with growth across all areas. Food market share rose by one-tenth of a percentage pont to 3.7%. "M&S Direct had a strong quarter with sales up 49%. 'Shop Your Way', our multi-channel ordering service, has now been rolled out to 434 stores as planned, and continues to be very popular with customers," the company said. With commodity prices on the rise and the company facing tougher comparatives from a year ago management is cautious about the outlook for the rest of the year. Existing guidance for the financial year 2010/11 remains unchanged. However, as a result of increased investment in marketing and higher volumes, operating costs before bonus are now expected to be at the top end of the previously guided range of +4 to 5%.