M&S profits fall but IT investment will continue

Marks and Spencer reported a fall in profits yesterday, but said investment in IT would continue.

Marks and Spencer reported a fall in profits yesterday, but said investment in IT would continue.

The retailer, which released its half-year results, saw a drop in pre-tax profit from £550.1m last year to £307.8m this year.

Chief executive Stuart Rose said capital expenditure is expected to drop from £700m in 2008/9 to £400m in 2009/10.

The company said its focus of investment will move from modernising its stores to investing in its supply chain and information technology. "This will drive improvements in costs and operating efficiencies over time", it said in its results statement.

The company will continue to focus on increasing its number of international stores, in countries including India, Russia and the Czech Republic. The investment in IT systems will be designed to support this expansion.

Rose said, "Our plan is to manage the business through the economic downturn by tightly controlling costs, capital expenditure, cash flow and stock.

"We believe we are well positioned to compete by improving our operational delivery and continuing to focus on quality, value and choice."

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