Retailer Marks & Spencer has today reported a 55.4% slide in first-half underlying profit, reflecting the impact of an April cyber hack that forced it to suspend online clothing orders for seven weeks and also hit food availability.
M&S, did, however, say it was confident it will be back on track by its financial year-end in March 2026.
"In the second half, we expect profit to be at least in line with last year. This should give us a springboard into the new financial year and set M&S up for further growth," CEO Stuart Machin said.
The group made adjusted profit before tax of £184.1m in the six months to September 27, down from £413.1m the same time last year, despite a 22.1% increase in sales to £7.97 billion.
In May, M&S estimated the cyberattack would cost it about £300m in lost operating profit in its full year, although it hoped to halve that impact through insurance, cost control and trading actions.
It said today it had received insurance proceeds of £100m, nearly offsetting £101.6m of cyberattack related costs booked in the period.
The 141-year-old group was forced to suspend online clothing orders for nearly two months and click and collect services for nearly four. Clothing and food availability in stores was also hit, while additional waste and logistics costs were incurred.
Prior to the hack, M&S was beginning to reap the benefits of a comprehensive turnaround plan that has been running since 2022 under Machin, with the group achieving its highest annual profit performance in over 15 years in its 2024/25 year.
Shares in M&S are up 2% so far this year, having recovered most of their cyber hack losses.
Meanwhile, Marks & Spencer has not discussed buying the 50% of the Ocado Retail business it does not own, with its CEO saying that such a deal was not currently in his plans.
M&S runs online supermarket Ocado Retail through a joint venture with retail technology group Ocado Group.
"No, we've never had a discussion, and it's not on my mind," Stuart Machin told reporters today when asked if he had explored buying it.
"We've got other things to do with our shareholder money and plenty to go at," he added.
The CEO also said that its UK customers were "worried" about the prospect of higher taxes from the British budget on November 26, and a speech by the finance minister yesterday had deepened their concerns.
"Our customers are increasingly concerned about rising costs and higher taxes, and they're worried about the budget," Stuart Machin said.
"They did get more worried following yesterday's speech," he said, adding that the company conducts frequent polls of customers.
