Marks And Spencer Group Plc · LSE:MKS
Marks And Spencer — H1 2025/26 Earnings Presentation
37 slides from Marks And Spencer's earnings presentation, Nov 5, 2025
Slide 1: Half Year Results: Reshaping M&S
HALF YEAR RESULTS Reshaping M&S 5 NOVEMBER 2025
Slide 2: Stuart Machin, Chief Executive
Stuart Machin CHIEF EXECUTIVE
Slide 3: Financial headlines
Financial headlines Results reflect one off effects of cyber incident M&S Group adjusted profit before tax of £184.1m, down £229.0m reflecting impact of incident partly offset by £100.0m of related insurance proceeds taken centrally Adjusting items of £167.8m including £101.6m of incident related co
Slide 4: Our strategic priorities
Our strategic priorities Reshaping for Growth QUALITY FOOD, STYLISH CLOTHES, BIGGER FREQUENT CUSTOMER BASE, HOMEWARE AND BEAUTY SHOPPING MORE BROADLY Consistent drumbeat of product innovation and Becoming a shopping list retailer in Food through quality upgrades ‘winning choices’ programme Further c
Slide 5: Cyber incident recovery
Cyber incident recovery M&S regaining momentum Recovery of online Fashion, Home & Beauty sales Immediate response Sales demand 1 % growth vs LY Action taken to protect customers, suppliers and the business which 40% included taking some of our systems offline 20% During the period we have prioritise
Slide 6: Food
Food Growing shoppers, driving volume and delivering market share M&S volume market share % M&S Food households Becoming a shopping list retailer 3.03% 9.3m Sales value and volume outperformed the market for 37 consecutive periods 1 2.95% Number of M&S Food shopper households continuing to grow 2.70
Slide 7: Fashion, Home & Beauty
Fashion, Home & Beauty Increasing style, investing in growth, moving with the times Quality, value and style perception improving Trading is recovering Quality and style perceptions show further improvement 1st year on year 62% 1st Targeted investments in Kidswear and lingerie to strengthen value 56
Slide 8: International
International Early progress on commercial reset Owned markets impacted by online closure and stock availability Cyber incident impacting operations Sales £m Total sales down 11.6% as owned and franchise shipments were impacted by incident 143.0 Website operations temporarily suspended Sales impact
Slide 9: Ocado Retail
Ocado Retail Reduced losses, optimising growth Ocado Retail outperforming the market Strong revenue growth and market share 20% Revenue up 14.9%, driven by growth in active customers and increased frequency 15% UK online grocery market share up 0.5% pts to 16.1% 1 10% Further opportunity to grow sal
Slide 10: Outlook
Outlook As we enter the second half, the consumer environment remains as uncertain as ever Our priority remains to offer the best value, quality, innovation and style to customers, to drive the transformation and to structurally reduce costs as external headwinds continue to increase We are confiden
Slide 11: Alison Dolan, Chief Financial Officer
Alison Dolan CHIEF FINANCIAL OFFICER
Slide 12: Half year reporting
Half year reporting Key principles Results reflect the first -time consolidation of Ocado Retail Limited Non controlling interests are deducted above M&S Group adjusted profit before tax Costs directly relating to the cyber incident are presented separately as an adjusting item Reclassification of C
Slide 13: Half year financials at a glance
Half year financials at a glance £8.0bn £184.1m £3.4m +22.1 % vs LY - 55.4 % vs LY - 99.1 % vs LY M&S Group adjusted Group sales Statutory profit before tax profit before tax - £193.0m £176.1m £2.53bn Free cash flow Net funds Net debt from operations excluding leases 13
Slide 14: Group profit
Group profit £m H1 25/26 H1 24/25 Change £m Change % Food 4,531.9 4,204.5 327.4 7.8% Fashion, Home & Beauty 1,697.6 2,030.5 (332.9) (16.4%) International 255.8 289.3 (33.5) (11.6%) Ocado Retail 1,479.9 - 1,479.9 n/a Total Sales 7,965.2 6,524.3 1,440.9 22.1% Food 89.1 216.4 (127.3) (58.8%) Fashion, H
Slide 15: M&S Group adjusted profit before tax bridge
M&S Group adjusted profit before tax bridge £m 413.1 £324m Incident -driven trading impact mitigated by £100m insurance proceeds (127.3) 16.0 100.0 7.6 184.1 (3.1) (25.3) 2.6 (197.3) (2.2) M&S Group Food Fashion, International M&S Insurance Ocado Share of Net Non M&S Group adjusted Home & Financial
Slide 16: Adjusting items
Adjusting items H1 25/26 £m Costs associated with the cyber incident (101.6) Incident systems response and recovery (82.7) Third party costs (18.9) Strategic programmes (6.5) Store estate (16.5) International reset 10.9 Other (0.9) Other adjusting items (54.1) M&S Bank transformation and insurance m
Slide 17: Food performance
Food performance Change 26 weeks ended H1 25/26 H1 24/25 vs 24/25 Sales (£m) 4,532 4,204 7.8% Operating profit before adjusting 89.1 216.4 (58.8%) items (£m) Operating margin % 2.0% 5.1% (3.1%) pts 17
Slide 18: Food operating profit margin bridge
Food operating profit margin bridge Operating profit margin before adjusting items % Operating costs to sales % H1 24/25 5.1 Retail costs (0.4) Gross margin (3.5) Logistics costs (0.1) Digital & Technology 0.1 Operating costs 0.4 Central costs 0.8 H1 25/26 2.0 Total 0.4 18
Slide 19: Fashion, Home & Beauty performance
Fashion, Home & Beauty performance Change 26 weeks ended H1 25/26 H1 24/25 vs 24/25 Sales (£m) 1,698 2,031 (16.4%) Operating profit before adjusting 46.1 243.4 (81.1%) items (£m) Operating margin % 2.7% 12.0% (9.3%) pts Store sales (£m) 1,315 1,361 (3.4%) Online sales (£m) 382 669 (42.9%) 19
Slide 20: Fashion, Home & Beauty operating profit margin bridge
Fashion, Home & Beauty operating profit margin bridge Operating profit margin before adjusting items % Operating costs to sales % H1 24/25 12.0 Retail costs (4.8) Gross margin (1.6) Logistics costs (1.1) Digital & Technology (1.5) Operating costs (7.7) Central costs (0.3) H1 25/26 2.7 Total (7.7) 20
Slide 21: International performance
International performance Change 26 weeks ended H1 25/26 H1 24/25 vs 24/25 Sales (£m) 256 289 (11.6%) Operating profit before 13.3 10.7 24.3% adjusting items (£m) Operating margin % 5.2% 3.7% 1.5% pts 21
Slide 22: Ocado Retail performance
Ocado Retail performance Change 25 weeks 26 weeks ended H1 25/26 H1 24/25 vs 24/25 ending 28 Sep Sales (£m) 1,539 1,339 14.9% 1,480 Operating profit before (3.6) (12.5) 71.2% (3.1) adjusting items (£m) Operating margin % (0.2%) (0.9%) 0.7% pts (0.2%) 22
Slide 23: Disciplined capital allocation
Disciplined capital allocation 1 Generation of free cash flow 2 Invest for growth and structural cost reduction 3 Returns on investment 4 Reducing net debt 5 Value creation for shareholders 23
Slide 24: Free cash flow from operations
Free cash flow from operations Cash flow H1 25/26 H1 24/25 Change vs 24/25 Adjusted operating profit 251.4 462.7 (211.3) Depreciation and amortisation 318.9 256.6 62.3 Underlying EBITDA 570.3 719.3 (149.0) Cash lease payments (180.1) (139.0) (41.1) Working capital (334.2) (263.1) (71.1) Defined bene
Slide 25: Free cash flow from operations H1 FY26
Free cash flow from operations H1 FY26 £m 319 570 (180) 251 (334) (13) 0 (25) (39) (172) (193) Adjusted Depreciation & Underlying Cash lease Working Financial interest All other Adjusting items in Net Free cash operating profit Amor tisation EBITDA payments capital & tax items cash flow capex flow f
Slide 26: Free cash flow from operations H1 FY26 vs LY
Free cash flow from operations H1 FY26 vs LY £m 21 0 62 43 (41) (17) 0 (211) 80 (16) (193) (71) 2 (45) Free cash Adjusted Depreciation & Cash lease Working Defined Financial Taxation Net Adjusting Share of All other Free cash flow from operating Amor tisation payments capital benefit interest capex
Slide 27: Net debt bridge vs FY25
Net debt bridge vs FY25 £m Free cash flow from operations (193) Acquisitions, investments and divestments (3) Dividends paid (52) Ocado Retail net debt and leases acquired (356) Ocado Retail new lease commitments (176) M&S lease commitments (78) Decrease in lease obligations 119 Exchange and other n
Slide 28: Capital expenditure
Capital expenditure Capex net of disposals H1 Anticipated capex net of disposals FY26 £234.6m Other Digital & Technology New stores £99m New stores (net of disposals) Store rotation £48m Store renewal c£650m £29m Maintenance Supply chain Store renewal £42m Supply chain £17m Digital & Technology Main
Slide 29: Structural cost reduction programme
Structural cost reduction programme H1 2025/26 delivered FY28 ambition increased from £500m to £600m Digital & £600m Technology Property Year 4 - 5 Food Logistics £34.3m FY26 £84m FY25 £120m c£330m Fashion, Home & Achieved to date Beauty Logistics Retail FY24 £180m 29
Slide 30: Balance sheet metrics
Balance sheet metrics £4.0bn £3.5bn £2.7bn £2.7bn £2.5bn £2.6bn £2.2bn £1.8bn £2.4bn £2.3bn £2.3bn £2.7bn £2.2bn £2.2bn £1.4bn £1.1bn £0.4bn £0.4bn (£46m) (£176m) Net funds (£448m) Net funds Net funds 19/20 20/21 21/22 22/23 23/24 24/25 H1 25/26 Net debt (funds) excluding lease liabilities Lease lia
Slide 31: Summary
Summary Trading performance reflects one off impact of Once Alison is 1 cyber incident offset by insurance mitigation happy with her script lets tie all the wording across.. Cash outflow in the period reflecting profit impact. 2 Timing effects expected to partially reverse in H2 Increased investment
Slide 32: Appendix
Appendix 32
Slide 33: Depreciation and amortisation
Depreciation and amortisation H1 25/26 Ocado All other Insurance £m Food FH&B Intl Group Retail segments Income Adjusting operating profit 89.1 46.1 13.3 (3.1) 6.0 100.0 251.4 Depreciation Tangible Asset 76.6 69.9 6.2 8.4 - - 161.1 Right of use asset 47.0 29.6 14.4 26.3 - - 117.3 Amortisation 16.5 1
Slide 34: Lease liability breakdown
Lease liability breakdown £2,704m Erith ‘right of use asset’ Ocado Retail Full Line Ocado Retail £487m Ocado consolidation International £2,704m M&S H1 25/26 £2,217m Office, Warehouse & Other Food H1 25/26 34
Slide 35: Stores and selling space
Stores and selling space NUMBER OF STORES Selling space Mar 25 UK Sept 25 Openings Closures Change (m sq. ft) Restated 1 Shopping Centre 1.6 16 16 0 0 0 Retail Park 4.7 82 83 0 (1) (1) High Street 1.9 66 67 0 (1) (1) High Street - large 4.2 62 64 0 (2) (2) Full Line total 12.4 226 230 0 (4) (4) FH&B
Slide 36: Non-controlling interests
Non - controlling interests P&L 27 Sep 2025 28 Sep 2024 ORL Other Total Total £m £m £m £m Adjusted NCI (10.5) (2.4) (12.9) (5.3) (Pre Tax) Taxation - 0.5 0.5 1.8 Adjusted NCI (10.5) (1.9) (12.4) (3.5) (Post Tax) NCI adjusting items (4.6) (1.0) (5.6) - Non - controlling (15.1) (2.9) (18.0) (3.5) inte
Slide 37: Ocado Retail accounting consolidation principles
Ocado Retail accounting consolidation principles Income statement 100% of Ocado Retail’s results included line -by -line in M&S results M&S Group Adjusted PBT stated after deduction of non controlling interests before tax Balance sheet Assets / liabilities recognised line -by -line in M&S balance sh
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