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* Pandemic means will accelerate transformation plan
* Says Ocado deal will 'turbocharge' digital offer
* To accelerate store closures programme
* 2019-20 profit down 21%
* Shares up 8.7%
(Adds detail, CEO comment, shares, PIX)
By James Davey
LONDON, May 20 (Reuters) - British retailer Marks & Spencer
said the coronavirus crisis would indelibly change its
business and that it would accelerate its turnaround, as the
high street stalwart seeks to reinvent itself anew after a
decade of failed revivals.
When the pandemic hit, M&S was already in the middle of a
new plan to improve its fortunes, including cost cuts and store
closures. CEO Steve Rowe said it would speed up those measures
under a programme it labelled "never the same again".
"I am determined to use the lessons from the crisis and
accelerate the transformation of M&S so we can emerge as a
renewed and stronger business," he told reporters on Wednesday,
as the group reported a 21% fall in 2019-20 profit.
Shares in M&S were up 8.7% at 1005 GMT, paring year-on-year
losses to 64%.
Rowe said the group would accelerate the closure of at least
100-120 stores.
M&S's partnership with Ocado, which will see it
launch an online food service for the first time in September,
provided an opportunity to "turbocharge" the group's digital
capability, he added.
The 136-year old group would move more swiftly to improve
its food supply chain and re-engineer its clothing and home
business.
Rowe also said he was determined to ensure old habits of
slow decision-making did not return.
M&S made a pretax profit before one-off items of 403 million
pounds ($493 million) in its year to March 28, down from 512
million pounds in 2018-19.
It expects the impact of the COVID-19 crisis to last through
the 2020-21 year and that subsequent demand may be depressed.
The vast majority of M&S's in-store clothing business has
been closed since the nationwide lockdown started on March 23.
Its online and food business has traded through the lockdown.
M&S' COVID-19 scenario assumes a 70% decline in clothing and
home revenue and a 20% decline in food revenue through to July.
However, in the first six weeks of its new financial year
the business outperformed the plan with cashflow over 150
million pounds better than expected under the scenario.
M&S has taken measures totalling over 1 billion pounds to
deal with the crisis, including 500 million pounds of cost
reductions and further actions to manage cash. It has also
secured liquidity and managed excess clothing and home stock.
The group is not paying a final dividend for 2019-20 and
does not expect to pay any for 2020-21, saving 340 million
pounds.
($1 = 0.8173 pounds)
(Reporting by James Davey; Editing by Paul Sandle and Pravin
Char)
