Marks & Spencer is on course to rejoin the FTSE 100 index after a bumper trading update sent shares to a 20-month high.
In a sign that the company has finally got its mojo back, it said food sales over the 19 weeks to August 12 were 11 per cent higher than a year earlier and its clothing and homeware division saw growth of more than 6 per cent.
M&S said it expects annual profits to be higher than last year having previously warned there might be a slight decline.
The unscheduled update sent shares up 8.3 per cent, or 16.9p, to 221.6p.
Recovery: Marks & Spencer said food sales over the 19 weeks to August 12 were 11% higher than a year earlier while its clothing and homeware division saw growth of more than 6%
M&S is valued at £4.3billion, leaving it firmly in the running to re-enter the FTSE 100 index at the next reshuffle in September.
That would be a major boost for M&S chairman Archie Norman as well as boss Stuart Machin and his co-chief executive Katie Bickerstaffe who together succeeded Steve Rowe last May.
When it was kicked out of the FTSE 100 in September 2019, it was the first time M&S had not been a member since the index was launched in 1984.
But with the turnaround that began under Rowe gathering pace, the firm said its half-year results in November would show ‘a significant improvement against previous expectations’.
The bullish update came despite bosses warning of ‘considerable uncertainties about the economic outlook’.
Machin’s turnaround blueprint included continuing to rid M&S clothes of their unfashionable image, driving growth in both stores and online, and slashing £400million of costs over five years.
AJ Bell investment director Russ Mould said: ‘There have been so many false dawns for Marks & Spencer over the years that it would be understandable if some observers remain sceptical, but its latest unscheduled update upgrading guidance is further evidence that something real is happening at the retailer.
‘The food side of the business has generally performed well over several years but the big transformation is in clothing.
‘Like a dowdy middle-aged dad who gets made over to a sharp new look – Marks & Spencer has really upped its game.’
#fiveDealsWidget .dealItemTitle#mobile {display:none} #fiveDealsWidget {display:block; float:left; clear:both; max-width:636px; margin:0; padding:0; line-height:120%; font-size:12px} #fiveDealsWidget div, #fiveDealsWidget a {margin:0; padding:0; line-height:120%; text-decoration: none; font-family:Arial, Helvetica ,sans-serif} #fiveDealsWidget .widgetTitleBox {display:block; float:left; width:100%; background-color:#af1e1e; } #fiveDealsWidget .widgetTitle {color:#fff; text-transform: uppercase; font-size:18px; font-weight:bold; margin:6px 10px 4px 10px; } #fiveDealsWidget a.dealItem {float:left; display:block; width:124px; margin-right:4px; margin-top:5px; background-color: #e3e3e3; min-height:200px;} #fiveDealsWidget a.dealItem#last {margin-right:0} #fiveDealsWidget .dealItemTitle {display:block; margin:10px 5px; color:#000; font-weight:bold} #fiveDealsWidget .dealItemImage, #fiveDealsWidget .dealItemImage img {float:left; display:block; margin:0; padding:0} #fiveDealsWidget .dealItemImage {border:1px solid #ccc} #fiveDealsWidget .dealItemImage img {width:100%; height:auto} #fiveDealsWidget .dealItemdesc {float:left; display:block; color:#004db3; font-weight:bold; margin:5px;} #fiveDealsWidget .dealItemRate {float:left; display:block; color:#000; margin:5px} #fiveDealsWidget .dealFooter {display:block; float:left; width:100%; margin-top:5px; background-color:#e3e3e3 } #fiveDealsWidget .footerText {font-size:10px; margin:10px 10px 10px 10px;} @media (max-width: 635px) { #fiveDealsWidget a.dealItem {width:19%; margin-right:1%} #fiveDealsWidget a.dealItem#last {width:20%} } @media (max-width: 560px) { #fiveDealsWidget #desktop {display:none;} #fiveDealsWidget #mobile {display:block!important} #fiveDealsWidget a.dealItem {background-color: #fff; height:auto; min-height:auto} #fiveDealsWidget a.dealItem {border-bottom:1px solid #ececec; margin-bottom:5px; padding-bottom:10px} #fiveDealsWidget a.dealItem#last {border-bottom:0px solid #ececec; margin-bottom:5px; padding-bottom:0px} #fiveDealsWidget a.dealItem, #fiveDealsWidget a.dealItem#last {width:100%} #fiveDealsWidget .dealItemContent, #fiveDealsWidget .dealItemImage {float:left; display:inline-block} #fiveDealsWidget .dealItemImage {width:35%; margin-right:1%} #fiveDealsWidget .dealItemContent {width:63%} #fiveDealsWidget .dealItemTitle {margin: 0px 5px 5px; font-size:16px} #fiveDealsWidget .dealItemContent .dealItemdesc, #fiveDealsWidget .dealItemContent .dealItemRate {clear:both} }
