Marks and Spencer boss pledges high street giant ‘will bounce back stronger' from cyber attack
The Easter attack saw it having to stop taking online fashion and home orders while stores ran out of some products
THE boss of Marks And Spencer has pledged the high street giant 'will bounce back stronger' from a cyber attack — and compared the financial toll to the Budget tax raid.
Chief exec Stuart Machin admitted hackers had dealt a heavy blow to its hard-fought turnaround but was confident of weathering the storm.
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Chief exec Stuart Machin admitted hackers had dealt a heavy blow to Marks and Spencer
Credit: Rex
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The Easter attack saw stores run out of some products — including favourites such as Percy Pigs
Credit: Reuters
The Easter attack saw it having to stop taking online fashion and home orders while stores ran out of some products — including favourites such as Percy Pigs.
Mr Machin reckoned the £300million 'gross costs' will likely be halved because of insurance and the retailer's own savings.
He told The Sun that Budget changes to National Insurance represented a £60million hit while new environmental packaging rules will add another £40million. The business also faces higher wages.
This means Chancellor Rachel Reeves will cause much longer-lasting pain than the criminal hackers.
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Mr Machin said: 'In comparison this cyber incident is a one-off cost.'
He described the decision to switch off online orders as 'chopping off the threat at its knees' and said he realised 'that we had to go through the pain to come back later',
He called the early stages of the crisis as going into 'survival mode'.
And he added the chaos of the last month had been 'a challenging time — but it is just a moment in time'.
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Five years ago chairman Archie Norman expressed his frustration that Covid store closures had robbed M&S of its turnaround 'just when we were showing a bit of leg'.
This time around the cyber attack has overshadowed the story of its best profits in 17 years.
M&S reveals SIX different Christmas food adverts featuring comedy legend and music star
The business reported its adjusted profits — M&S's preferred measure — rose 22 per cent to £875million in the year to March 29.
And while during the pandemic M&S was saddled with £1.4billion of debt, the balance sheet is 'the best its been for 30 years'.
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Sales were up six per cent to £13.9billion, boosted by a 8.7 per cent jump in food sales and a 3.5 per cent rise in fashion and home sales.
However, a black spot was the 23.9 per cent drop in pre-tax profits to £511.8million — linked to a hefty £248.5million writedown of its joint venture in Ocado.
NEW TECH FOR FUTURE
M&S is taking advantage of its 'window of disruption' to speed up planned IT overhauls — and will keep much of the technology developed during its cyber crisis.
The retailer admitted its former systems were too complicated and, early in the disruption, left shop staff having to resort to pen-and-paper stocktaking.
It has developed new apps since, with one dubbed 'Henry Hoover' because it 'sucks up' product tagging codes to check stocks.
A 'gap scanning app' notifies warehouses what is needed.
SEVERN'S SURGING PROFITS
SEVERN TRENT profits have flowed even higher — just as it hikes customer bills by more than a fifth.
The 4.7million households served by the water firm will be outraged after it raised bills by £99 a year to an average £556.
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Severn boss Liv Garfield justified the increase by saying that it will help fund £15billion of investment
Credit: Getty Images - Getty
Severn boss Liv Garfield justified the increase by saying that it will help fund £15billion of investment in upgrading its pipes, sewers and also build new reservoirs — creating 7,000 new jobs.
The company's profits have surged by 59 per cent to £320million for the year ending March 31 while revenues rose by 3.8 per cent to £2.4billion.
It has increased its dividend as a result by 4.2p to 121.7p for investors.
The firm was fined £600,000 in November for polluting a kilometre of Trent River.
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Severn Trent said that it had missed its 'overall regulatory pollutants target' and reduced spills by 66 per cent.
JD GETS KICKING
JD SPORTS was given the boot by investors after a drop in profits — and a warning that Trump tariffs could lead to higher prices.
Shares tumbled by up to ten per cent after the retailer reported pre-tax profits were down 11.8 per cent to £715million, despite revenues rising 8.7 per cent to £11.4billion.
Investors were also spooked by a two per cent sales slump in the 13 weeks to May 2.
The firm warned that the volatility from tariffs may see prices 'rise to some degree' for shoppers in the US.
BRANCHES BOON
THE boss of Nationwide stressed the importance of branches as she said they are still being used to take out new products.
Debbie Crosbie told MPs April was Nationwide's busiest month ever for people taking out Cash individual savings accounts (ISAs) with 40 per cent of them written 'in branch'.
The Treasury Select Committee also heard 30 per cent of current account openings are made in person.
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Nationwide, which acquired Virgin Money, says all branches will stay open until 2028.
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