By James Davey
Once a venerable British institution, M&S faces unrelenting competition on the high street and online, while efforts to revitalise its 134-year-old business are being held back by a squeeze on consumers as inflation rises and wage growth falters.
In stark contrast to M&S's woes, British online fashion retailer Boohoo, founded little over a decade ago, said it had doubled revenue in the final four months of the year and raised its sales forecast.
But shares in M&S fell as much as 7 percent on Thursday after it said comparable sales of clothing, homeware and food had all fallen in its fiscal third quarter, albeit not by as much as most analysts had forecast.
"We had a mixed quarter that started off with a challenging October but got better on both sides of the business in the run-up to Christmas," said Rowe.
Investors needed to be patient and M&S would return to positive like-for-like sales, he said. "If it comes through in the next quarter fantastic, if it doesn't I believe we're taking the right steps."
But some analysts are still to be convinced.
WORK TO DO ON FOOD
Debenhams and Mothercare have both issued profit warnings, John Lewis said on Thursday that higher costs and tough competition had blunted the benefits of solid Christmas sales, while House of Fraser saw its sales fall.
And Tesco, Britain's biggest retailer, missed forecasts for its festive trading.
On Thursday, M&S said like-for-like sales of clothing and homeware fell by 2.8 percent in the quarter - ahead of analysts' average forecast of a 3.4 percent decline but worse than a second quarter fall of 0.1 percent.
Online sales also suffered, with growth slowing to 3 percent, from 6 percent in its second quarter.
Rowe, who said he was working well with Norman, said M&S had cut prices on about 200 food lines before Christmas but would do more to improve its competitiveness, availability, supply chain and waste reduction.
"In these turbulent times it's great having two retailers to bounce ideas around."
And despite the sales disappointment, M&S maintained its guidance for the full 2017-18 year.
Before the update, analysts were on average forecasting a pretax profit before one-off items of 578 million pounds, down from 614 million pounds in 2016-17.
This would represent a second straight year of decline.
($1 = 0.7395 pounds)
(Additional reporting by Alistair Smout; Editing by Kate Holton/Guy Faulconbridge/Alexander Smith)
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