Marks & Spencer has finally emerged from its digital shell, and Stuart Machin is now free to flex his fiscal muscles. The chief executive's pre-budget remarks have been a respite for investors who were bracing themselves for a more sombre set of financials following the devastating cyber-attack that crippled the company's website last Easter.
Machin has taken the cautious approach, acknowledging that "the incident" will be viewed as an extraordinary moment in time rather than a harbinger of doom. The food business has been quicker to recover, with sales up 7.8% in the half-yearly period, largely due to its more UK-focused supply chains moving faster.
However, the clothing and home division has taken longer to get back on track, with Machin admitting that sales declined by 16.4% due to the website's struggles and the loss of forecasting ability. The manual stock control imposed during the cyber-attack has resulted in higher waste costs, which will add to the overall bill.
Despite the challenges, May's preliminary estimate of £300m in trading damage seems reasonable, with Machin now revising his estimates upwards to around £324m, a significant chunk of which is covered by insurance. The City has taken this as reassuring news, suggesting that the lingering effects of the cyber-attack should clear up by early next year.
The long-term plan is for M&S to focus on expansion in its food business, aiming to double sales over time, while streamlining its retail estate through store closures and openings of more efficient outlets. This strategy has been in place for some years, but the recent disruption will not significantly alter the company's medium-term trajectory.
Interestingly, the stock market has taken a clinical view of the cyber-attack, recognizing that one lost year of profit progress does not seriously impact the business's value if the underlying growth prospects remain intact. As such, M&S shares have traded relatively sideways over the past year, with investors more focused on the budget's potential to affect consumer spending power than the company's own financials.
Overall, while Marks & Spencer has certainly weathered a significant challenge, its resilience and adaptability will be crucial in driving recovery and growth in the years ahead.
Machin has taken the cautious approach, acknowledging that "the incident" will be viewed as an extraordinary moment in time rather than a harbinger of doom. The food business has been quicker to recover, with sales up 7.8% in the half-yearly period, largely due to its more UK-focused supply chains moving faster.
However, the clothing and home division has taken longer to get back on track, with Machin admitting that sales declined by 16.4% due to the website's struggles and the loss of forecasting ability. The manual stock control imposed during the cyber-attack has resulted in higher waste costs, which will add to the overall bill.
Despite the challenges, May's preliminary estimate of £300m in trading damage seems reasonable, with Machin now revising his estimates upwards to around £324m, a significant chunk of which is covered by insurance. The City has taken this as reassuring news, suggesting that the lingering effects of the cyber-attack should clear up by early next year.
The long-term plan is for M&S to focus on expansion in its food business, aiming to double sales over time, while streamlining its retail estate through store closures and openings of more efficient outlets. This strategy has been in place for some years, but the recent disruption will not significantly alter the company's medium-term trajectory.
Interestingly, the stock market has taken a clinical view of the cyber-attack, recognizing that one lost year of profit progress does not seriously impact the business's value if the underlying growth prospects remain intact. As such, M&S shares have traded relatively sideways over the past year, with investors more focused on the budget's potential to affect consumer spending power than the company's own financials.
Overall, while Marks & Spencer has certainly weathered a significant challenge, its resilience and adaptability will be crucial in driving recovery and growth in the years ahead.
. if they can turn around food sales so quickly, that's a good sign they're on the right track 
. but clothing and home division is still struggling, maybe they need to think outside the box (or store) 
. expansion in food business makes sense, doubling sales over time sounds achievable 
. also, stock market seems pretty chill about it all, investors more worried about budget than company's finances 
. overall, M&S needs to keep adapting and innovating to stay ahead of the game 
STUART MACHIN SEEMS LIKE A total GENIUS FOR TAKING A CAUTIOUS APPROACH AND ACKNOWLEDGING THAT THE CYBER-ATTACK WAS JUST A ONE-OFF THING 
. I mean, who wouldn't expect a 16.4% SALES DECLINE IN THE CLOTHING DIVISION tho?! 
BUT SERIOUSLY, M&S IS TAKING SOME GREAT STEPS TO FOCUS ON ITS FOOD BUSINESS AND STREAMLINE ITS RETAIL ESTATE 
. IT'S GOOD TO SEE THE FOOD BUSINESS DOING WELL, WITH SALES UP 7.8% - THAT'S LIKE, REALLY STRONG! BUT ON THE OTHER HAND, THE CLOTHING AND HOME DIVISION IS STILL RECOVERING FROM THAT CYBER-ATTACK... IT'S A BIT OF A MIX. I GUESS THE STOCK MARKET SEEMS TO BE OK WITH THINGS, THOUGH - INVESTORS ARE MORE CONCERNED ABOUT THE BUDGET THAN M&S'S FINANCES THEMSELVES 
. On the other hand, the food business is doing alright, sales are up 7.8% and they're focusing on expansion there to double sales over time 
. I guess it's good that M&S is being cautious but also investing in new strategies to streamline their retail estate and reduce waste costs 
. The stock market seems to be taking a long-term view, so fingers crossed M&S can get back on track soon 
.
. It's all about adapting and moving forward, you know? And I gotta say, M&S shares have been pretty chill despite everything, which is a testament to the company's long-term prospects 
.
just saw that M&S is finally out of the woods after that cyber-attack 
! Stuart Machin's cautious approach is super smart, I mean who wants to freak out investors? 
The food business is killing it, sales up 7.8% - that's no joke! 
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they were like my favorite store and i was stressing out when their website crashed last easter 
and he's actually kinda happy about it! 
but clothing & home division still has some work to do, sales declined by 16.4%... yikes 
anyway i'm hoping they'll get back on track soon and maybe even open up some new stores 
. I mean, 16.4% decline in sales for their clothing and home division is still a pretty big hit 
. All that extra stock control during the cyber-attack has gotta add up somehow! But overall, M&S seems like they're on the right track 
.
</font> - it's been damaged by that cyber-attack 
. I'm glad they're revising their estimates upwards too 
!
but seriously it affected their clothing sales by 16.4% 
which is a lot! and the company's website is still recovering from the attack 
and i love how investors are focusing on consumer spending power rather than the cyber attack itself 
. But seriously, M&S is like the ultimate survivor – it survived a major cyber attack and still managed to come out with a decent sales figure in its food business 
. And let's be real, who needs forecasting ability when you've got manual stock control that's more like a game of 'guess what's on sale this week'? 
and now stuart machin can just chill 
which btw is doin way better than thier clothing and home divison 
but hey atleast its not as bad as some other companies that got hacked 
. It’s interesting how investors are taking the budget news as more positive than expected too 
anyway, £324m is a pretty penny for a cyber-attack... hope they can make the most of their insurance payout 
. And I love that the long-term plan is still focused on expansion and streamlining retail, even with this disruption. It just goes to show that M&S has been preparing for this kind of thing all along 
. The fact that investors are more worried about the budget than the company's finances is a good sign - it means they trust M&S to bounce back 
. Expanding food business and streamlining retail estate sounds okay, but what about the customer experience? Do they really think a website glitch will just magically resolve itself? 
! Stuart Machin's leadership is much needed right now, especially with the website struggles and all. I mean, 16.4% sales decline in clothing and home division is a big deal, but at least food business is doing alright 
.