UK-based retail group Marks and Spencer (M&S) has reported that year-on-year profit fell 34.1 per cent during the first half of 2008, down to £297.8m (€375.4m) from £451.8m (€569.5m) during the previous year.

'Market conditions and consumer confidence declined through the half,leading to reduced profits year on year, due to lower sales andinvestment in margin,' said group chairman Sir Stuart Rose. 'Tradingthroughout October has been volatile with recent events in thefinancial markets and their impact on the wider economy furtherweakening consumer sentiment.'

For the 26-week period ended 27 September, revenue increased marginally (0.8 per cent) to hit £4.2bn (€5.29bn), although UK contribution fell 1.1 per cent from £3.86bn (€4.86bn) in 2007 to £3.82bn (€4.81bn).

Total revenue in the group's food sector grew 0.5 per cent during the first half, with clothing and general merchandise falling by 3.5 per cent and 2.8 per cent respectively.

'Our plan is to manage the business through the economic downturn by tightly controlling costs, capital expenditure, cash flow and stock,' Mr Rose said. 'We have a strong balance sheet underpinned by significant property assets and secure funding position. We also have a strong brand and believe that we are well positioned to compete by improving our operational delivery and continuing to focus on quality, value and choice.'

'We are confident we have the right plan to bring Marks and Spencer through these difficult times,' he added.

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