By James Davey
LONDON (Reuters) -British retailer Marks & Spencer 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, one of the biggest names on the UK high street, 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 184.1 million pounds ($247.1 million) in the six months to September 27, down from 413.1 million pounds in the same period last year, despite a 22.1% increase in sales to 7.97 billion pounds.
In May, M&S estimated the cyberattack would cost it about 300 million pounds in lost operating profit in its full year, although it hoped to halve that impact through insurance, cost control and trading actions.
It said on Wednesday it had received insurance proceeds of 100 million pounds, nearly offsetting 101.6 million pounds 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.
($1 = 0.7451 pounds)
(Reporting by James Davey, Editing by Paul Sandle)
