M&S expects profit recovery after cyber hack-driven slump

* 2025/26 adjusted profit before tax down 24%

* Cyber ​hack related ⁠costs were £131.3 million

* Expects 2026/27 profit to ​exceed 2024/25 level (Adds detail paragraphs 6 to 13)

LONDON, May 20 (Reuters) - British retailer Marks & Spencer ​forecast ‌a return to profit growth this year after it slumped 24% in 2025/26, hit by ⁠a disruptive cyberattack that dented sales and margins.

The 142-year-old ⁠M&S, one of the biggest ​names on the UK high street, said it entered its 2026/27 year with a clear plan and a strong balance sheet and was focused on delivering further improvements to ​product availability ‌and service levels.

"Profit growth is expected to resume versus 2024/25," it said on Wednesday.

M&S said its outlook for the current year takes account of higher fuel, freight and input costs and continued government tax levies and regulatory headwinds for the ​sector.

It would mitigate these through improved buying, reinvestment in value to drive volume, and ‌savings from its structural cost reduction programme.

ONLINE CLOTHING ORDERS SUSPENDED

The cyberattack meant M&S was forced to suspend online clothing orders for ‌seven weeks and click-and-collect services for nearly four. Clothing and food availability in stores was also hit, while additional waste and logistics costs were incurred.

"We were laser focused on ​our customers, worked incredibly hard to recover our business, and we came out stronger," CEO Stuart Machin ‌said.

The group made adjusted profit before tax of £671.4 million in the year to March 28, down from £881.1 million in 2024/25. Second half profit grew 4.1% versus the previous year.

M&S ⁠said ⁠costs related to the cyber hack were £131.3 million.

While food sales ‌rose 7.0% and the division grew market share, sales in fashion, home and beauty slid 7.7%.

Machin said ​recovery in FH&B ​has taken longer, "but there is strong growth potential."

But he added ‌that "retailers face a triple whammy of headwinds with increased taxation, a greater regulatory burden and ongoing global conflict".

Shares in M&S have fallen 11% over the last month.

Marks & Spencer