Marks & Spencer Group (MKS) H2 24/25 earnings summary

Executive summary

• Delivered strong annual results with significant growth in sales, profits, and cash flow, reflecting progress in business transformation and resilience despite a post-year-end cyber incident.

• Achieved third consecutive year of growth with a strong financial position and increased investment in transformation initiatives.

• Adjusted profit before tax rose 22.2% to £875.5m, while statutory PBT fell 23.9% to £511.8m due to a non-cash impairment in Ocado Retail.

• Food and Fashion, Home & Beauty segments delivered robust sales and margin growth; international performance declined.

• Free cash flow from operations reached £443.3m, with net funds at £437.8m, reflecting a strengthened balance sheet.

Financial highlights

• Group sales reached £13.9bn, up 6.1% year-over-year; adjusted PBT up 22.2% to £875.5m; statutory PBT down 23.9% to £511.8m due to £248.5m Ocado Retail impairment.

• Food sales up 8.7% to £9.0bn; adjusted operating profit up 24.6% to £484.1m with margin at 5.4%.

• Fashion, Home & Beauty sales up 3.5% to £4.2bn; adjusted operating profit up 8.6% to £475.3m with margin at 11.2%.

• International sales down 8.5% to £658.0m; adjusted operating profit down 3.1% to £46.3m.

• Free cash flow from operations increased to £443.3m; net funds (ex-leases) improved to £438m.

Outlook and guidance

• Entered new financial year with strong momentum, but cyber incident in April caused short-term disruption, especially in online operations.

• Estimated impact on group operating profit of around £300m for the current year, with mitigation planned through cost management, insurance, and trading actions.

• Capital investment planned to increase to £600m–£650m in FY25/26 to support growth and resilience.

• Ambition to achieve over £500m in structural cost savings by FY27/28.

• Targeting 420 Food stores and 180 Full Line stores by FY27/28.