Marks & Spencer has announced today that the last 3 months saw sales fall. In the 2nd quarter of 2012 sales fell by around 2.8%. It blames the weather with heavy rain disrupting the supply chains and keeping customers away from the high streets. However, John Lewis and Debenhams who both share the same high street market, have both reports an improvement in sales.
The reduction is sales was matched by a reduction in share price this year. As a result there will be changes in the management team to attempt to revitalise the clothing retail part of the business.
The biggest change is that Kate Bostock, the exec. director in charge of general merchandise, will be resigning from her role on the board by 1st October. There are rumours that Bostock may be going to ASOS, the online clothing retail company which has seen sales increase during the wettest Spring and Summer since records began.
Bostock will be replaced by John Dixon who currently looks after Food. He will be assisted by Belinda Earl, the newly appointed Style Director, who has been CEO at Debenhams, Jaeger and Aquascutum.
Steve Rowe will take Dixon’s place in charge of Food.
Share Price Rises Again
The news of the changes in top management has improved investor confidence and M&S saw its share price rise again today as investors try to take advantage of the low price at the moment.
From the 2012 AGM
At the annual general meeting today shareholders questioned the suitability of the management team and the board of directors. One shareholder complained about the lack of women on the board of directors, which seems to reflect on the poor choices that have been made in the women’s clothing lines in the last year. However, there are currently 5 women on the board:
- Laura Wade-Gery – eCommerce
- Miranda Curtis – a non-exuctive director
- Kate Bostock – Executive Director, General Merchandise*
- Martha Lane Fox – Non-Executive Director
- Amanda Mellor – Group Secretary and Head of Corporate Governance
Two pensioners at the AGM were happy with the clothes, but not happy with the rising prices. They did criticise of the M&S restaurant though, saying that the quality of the food has reduced and that Waitrose is now the best place to eat on the high street.
One shareholder shouted out that Marc Bolland, the CEO, is the “Bob Diamond of retail“. A little harsh we think, but there are some unhappy shareholders.