UPDATE 4-Britain's M&S to close stores, cut back on clothing

* Retailer to close about 30 UK stores, switch 45 to foodonly

* Will shut 53 stores in 10 international markets

* First half profit falls 19 pct

* New CEO seeks to reduce reliance on clothing business

* Shares down 6 percent (Adds short interest data)

By James Davey

LONDON, Nov 8 (Reuters) - Britain's Marks & Spencer plans to shut more than 80 stores at home and abroad at a costof up to 550 million pounds ($684 million) as its new boss triesto revive the retailer by shifting its focus more towards foodthan fashion.

M&S, whose shares have fallen 22 percent so far this year,reported a 19 percent slump in first-half profit on Tuesday andanother decline in quarterly clothing sales.

Steve Rowe, a company veteran who took over as CEO in April,has the task of reviving the fortunes of the 132-year-oldretailer, once a staple of the British shopping street, knownfor its quality everyday clothing and a slogan that "thecustomer is always and completely right".

Clothing sales have been in inexorable decline in recentyears despite the launch of sub-brands such as Per Una andAutograph, and shoppers complained they felt the style, sizingand quality was increasingly missing the mark.

Its market share has been eroded by rivals such as Next and a push from supermarkets into clothing, whileyounger shoppers favour Primark and H&M's cheaper prices.

"These are tough decisions, but vital to building a futureM&S that is simpler, more relevant, multi-channel and focused ondelivering sustainable returns," he said.

Rowe plans to close about 30 stores selling clothing,homewares and food and convert another 45 into food stores overthe next five years. That will mean a reduction of 10 percent inthe floorspace devoted to racks of skirts, jumpers and trousers.

"This is not about the M&S brand disappearing," Rowe toldreporters. "In fact with our Simply Food (opening) programme wewill be in more locations in the future than we are in today."

The cost of the programme would be 50 million pounds ($62million) for the next three years, rising to about 100 millionpounds in the following two years.

Expansion will focus on M&S's food business, traditionallylower margin, which contributes over half of group revenue andabout a third of profit.

M&S said it will also retreat overseas, closing 53 stores in10 loss-making markets, including France and China, at a cost of150-200 million pounds over the coming year, concentratinginstead on its profitable franchise model.

M&S trades from 468 overseas stores across 58 internationalmarkets, with 194 owned stores and 274 franchise stores.

Rowe is undoing some of the overseas expansion overseen byhis Dutch predecessor Marc Bolland.

M&S stock was down 6 percent at 327 pence at 1514 GMT.

Shares of the British retailer out on loan have beensteadily rising since the middle of September and are up morethan 60 percent over that period, showed data from FIS' AstecAnalytics.

Hedge funds tend to borrow a company's stock in the beliefthe price will fall and they can repay the loan for less,profiting from the difference in what is known as 'shorting'.

CLOTHING NEEDS REPAIR

Analysts at Liberum, who have a "sell" rating on M&S stock,said they had wanted to see more radical action.

"By transferring 30 or more Clothing & Home stores to Food,M&S looks to play to what has been its strongest suit in recentyears as food has outperformed clothing by some distance," theysaid.

"We believe, though, that the fortunes of M&S will stand orfall by the performance of the core UK clothing business, andthe outlook for that remains highly challenged."

M&S will seek to simplify its clothing ranges by removingthe Indigo, Collezione and North Coast labels.

Rowe, who has worked for the company for 26 years, haspledged to revive M&S's clothing by improving ranges andavailability, cutting prices and reducing promotions.

However his plan, outlined in May, came with a warning of ashort-term dent to sales and profit.

He said on Tuesday there were "early signs of improvement",pointing to a rise in full-price clothing market share in thesecond quarter.

M&S reported an underlying pretax profit for the six monthsto Oct. 1 of 231 million pounds - better than analysts'consensus forecast of 216 million pounds but down from 284million pounds a year earlier.

Quarterly clothing and home sales at stores open over a yearfell 2.9 percent - better than analysts' average forecast ofdown 3.9 percent. That was an improvement on a first quarterslump of 8.9 percent which was its worst performance for adecade.

Second quarter like-for-like food sales fell 0.9 percent. ($1 = 0.8061 pounds)

(Additional reporting by Emma Thomasson and Maiya Keidan;Editing by Keith Weir/Louise Heavens)