M&S shares wave goodbye to Bolland

<p>For Amsterdam-born Marc Bolland, finally some relief from puns about valiant attempts to plug the dike. He is now M&S’s former CEO. There was still […]</p>

For Amsterdam-born Marc Bolland, finally some relief from puns about valiant attempts to plug the dike.

He is now M&S’s former CEO.

There was still at least one ignominy to suffer though.

As stock markets tanked around Europe, Marks & Spencer shares were among the handful to rise, before dipping back by a similar amount at the time of writing.

That said loud and clear investors cheered the end of Bolland’s 6-year tenure.

The shares rise even seemed to shrug off Mark’s deeply disappointing update on all-important Christmas trading.

Actually, it looked like investors were continuing to sharply discount virtually every other aspect of M&S’s business—many of which have been going the (retail industry equivalent) of gangbusters—to focus mostly on serial failures of General Merchandise (clothing/homeware).

In what M&S called its “best ever” Christmas, food sales jumped 17% in the key week before the 25th December, up 3.7% gross for the quarter and 0.4% like-for-like.

M&S.com online even pretty much matched John Lewis’s Internet sales growth over the comparable quarter.

The latter’s were 21.4% higher in the six weeks to 2nd January.

Marks’ jumped 20.9% higher than those in same season the year before.


Top brass of Sainsbury’s, Tesco, Morrisons et al would also probably pay handsomely for M&S’s leading cash generation.

This enabled it to reduce operating cost guidance to a 2.5% rise from an earlier forecast 4% rise, despite continuing improvement initiatives.


For investors, this burnished the buyback programme, leading to £111m of shares scooped up to date.

True, there’s no getting away from General merchandise like-for-like Q3 sales, including Christmas, falling 5.8%, worse than expected.

(And some of that was, like last year, due to logistical mis-steps…paging Mr Bolland?)

Still, it looks like companies such as Next, which already reported winter sales this week, took some of the sting out—M&S’s share slide on Thursday looked contained.

Next shares fell hard earlier this week after it said record mild temperatures forced it to double down on discounts to shift cold-weather clothing stock.

For M&S though, it’s now difficult to see whether Bolland’s replacement could do better at fixing Gen. Merch. than his predecessor.

Steve Rowe, who hasn’t exactly made a secret of his desire for the top over the last few months, now has it.

It remains to be seen if his 25 years at the company have inculcated any hidden talent for industry beating innovation.

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.