Marks & Spencer has a big problem — it's still not fashionable | ||
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While profits improved, this was largely down to cutting costs, particularly in its supply chain, rather than growth. Revenue was near-stagnant, rising by just 0.4% to £10.31 billion. But if you dive below that headline number, it's clear that things are far from fixed at M&S, which has been struggling for years. And Marks & Spencer's crucial clothing line, once the centrepiece of the business, is still in a terrible state. Sales at the "general merchandise" division, which is mainly clothing, fell by 2.5% in the year and 3.1% if you don't include sales from new shops opened during the period. The retailer admitted the figure was "disappointing". It's particularly damning when you consider how hard M&S has working to reinvent itself as a fashionable brand, particularly for women who traditionally form the backbone of its customer base. Marks & Spencer has launched several big budget advertising campaigns over the last year in a bid to shift its image as a dowdy shop for grannies. It has also trumpeted the appeal of key pieces such as the suede skirt and is partnering with hip brands for things like trainers. Clothing sales did return to growth in the final quarter of the year, but only by 0.7% and it's not clear if this trend will continue. The 2.5% fall across the year shows that even if it does, Marks & Spencer has a long way to go to repair its fashion business. If Marks & Spencer can't fix the problems at its clothing business, it won't be able to grow revenues. And if it can't grow revenues, it's only a matter of time before profit begins to fall again. There are only so many efficiencies you can make and costs you can cut. Join the conversation about this story » NOW WATCH: 'The Little Prince' trailer looks better than anything Pixar has made in years  | ||
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High street retailer Marks & Spencer has finally managed to end four year's of falling profits, announcing this morning that full-year pre-tax profit rose by 6.1% to £661.2 million. Altice moves into US market with purchase of Suddenlink | ||
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Paris (AFP) - European cable and mobile operator Altice said Wednesday it had bought 70 percent of Suddenlink Communications in a deal that values the seventh-largest US cable company at $9.1 billion (8.2 billion). "With this acquisition, the Altice Group enters the large and attractive US cable market and takes a further step in diversifying and balancing its portfolio of high-quality businesses," said a statement from the company, which owns the French cable and mobile operator Numericable-SFR. With 1.5 million residential and 90,000 business customers in Texas, West Virginia, Louisiana, Arkansas and Arizona, Suddenlink is present in attractive growth markets and generated $2.3 billion in revenue and over $900 million operating profits last year. "We are very excited about the acquisition of Suddenlink and are highly committed to continue to improve network investment, customer offers and service innovation in the attractive US market," Altice chief executive Dexter Goei said in a statement. "Our investment in Suddenlink, our first in the cable sector in the US, opens an attractive industrial and strategic avenue for Altice in the US, one of the largest and fastest growing communications markets in the world," he added. Luxembourg-based Altice, which is controlled by French-Israeli billionaire Patrick Drahi, has been on an acquisition drive. Last year it propelled itself into the major leagues in France when it won a bidding war for mobile operator SFR which it is merging with Numericable. That deal, worth as much as 14.25 billion euros, was financed mostly with debt, and raised eyebrows as its market capitalisation at the time was just 11.3 billion euros. It also snapped up the Portugese assets of Portugal Telecom for 7.4 billion euros. Altice said it would pay $1.2 billion in cash and that most of the Suddenlink transaction would be financed with $6.7 billion of new and existing debt at the US company. The remainder would be financed by a $500 million vendor loan note and roll over from BC Partners and CPP Investment Board, which will retain a 30 percent stake in Suddenlink.
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German rail passengers face more chaos as drivers strike | ||
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Frankfurt (AFP) - German rail operator Deutsche Bahn cancelled two thirds of long-distance passenger services Wednesday as train drivers began an open-ended walkout that will last at least one week. The strike, the ninth in a protracted dispute, had actually begun on Tuesday, initially affecting freight trains, but was extended to passenger services from 0000 GMT on Wednesday. It is the latest flareup in a battle over wages, work hours and negotiating rights between the small GdL union and national rail operator Deutsche Bahn (DB). In early May the union staged a nearly week-long walkout, the longest in DB's history, which industry groups estimated cost Europe's top economy almost half a billion euros ($550 million). The GdL, which represents some 20,000 train drivers, is demanding a wage rise and shorter work hours as well as the right to represent other rail workers such as conductors and restaurant carriage staff. That demand is effectively a turf war with the larger railway union EVG, which has more than 200,000 members, and which is now involved in separate, less heated, wage negotiations with DB. After weekend talks between the GdL and Deutsche Bahn again ended badly, the union on Monday announced the latest strike. GDL has not said how long the latest walkout will last, but said it will be longer than the six-day industrial action at the start of May. The union said it would give 48 hours' notice when the strike will end. Deutsche Bahn confirmed Wednesday that two thirds of long-distance services would be cancelled and an average one third of regional services, varying from region to region. In freight services, around two thirds would run, the company said. Eastern Germany was particularly hit. And fewer than half of regional trains in Berlin and in Hamburg were running. Deutsche Bahn said it would "do everything in its power" to ensure that as many services as possible could run at the weekend, which is the Christian Pentecost holiday. Deutsche Bahn transports around 5.5 million passengers and over 600,000 tonnes of cargo in Germany every day. Join the conversation about this story »  | ||
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