British retailer Marks & Spencer plans to test new store formats tailored to local demographics as it looks to counter tough trading conditions and build on a 13% rise in full-year profit.
Britain's biggest clothing retailer, which also sells upmarket foods and homewares, said today the new formats would sell products selected against several criteria, such as age and affluence of shoppers, and have better layout and signs.
The tests, part of M&S chief executive Marc Bolland's plan for growth unveiled in November, will start this October.
M&S said that international sales grew by 6.1%, accounting for 10.3% of total group revenues.Ireland is included in this division. Underlying operating profit was up 8.6% to £147m. The company said it opened a total of 49 new stores during the year.
The retailer said that trading in Ireland and Greece continued to be impacted by the weakness in the local economies. However, it said it remains committed to developing the business in Ireland.
Britain's retailers are mostly struggling as shoppers are hit by rising prices and austerity measures. Clothing chains are also facing soaring cotton prices.
'We have had a good start to the new financial year but we expect trading conditions in the year ahead to be challenging,' M&S said, echoing comments from rivals.
The 127-year-old group has around 700 stores in the UK as well as more than 320 shops in over 40 countries, made a profit before tax and one-off items of £714m sterling in the year ended April 2.
That was just ahead of a forecast for £710m, helped by market share gains in both clothing and food, driven by new products such as stormproof suits and French-inspired Bistro ready meals.
Revenues rose 4.2% to £9.3 billion and the dividend was increased by 13.3% to 17 pence a share.
M&S, which saw profit plunge from £1 billion at the start of the economic downturn, has been outperforming rivals recently, helped by strength among older and more affluent customers coping better as incomes are squeezed.
Investors have warmed to Bolland's plan to revamp UK stores, expand online and overseas, and improve logistics and marketing, all of which have seen him make a string of high-profile management appointments.
Bolland said surging cotton prices had less impact on M&S than on rivals, many of which sell cheaper goods where raw materials make up a larger proportion of the price.
