M&S shares under pressure as cyber chaos heads into second week

Daily Mail​

28-04-2025

Marks & Spencer shares extended losses this morning with last week's cyber attack resulting in the retailer being forced to suspend online shopping.
The FTSE 100 high street stalwart has paused taking orders via its UK & Ireland websites and apps, and some M&S International operated websites, as part of efforts to manage the impact of the attack.
M&S's online presence a key driver of its crucial clothing and homeware business, and investors are concerned about the ramifications for sales as the fallout heads into its second week.
M&S shares were down 2.7 per cent to 375p in early trading, taking losses since M&S revealed the attack on 22 April to around 8 per cent.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said the ongoing suspension of online orders 'will be hugely damaging for sales'.
Online orders accounted for around a third of the retailer's first half sales in clothing in homeware, which generated an adjusted operating profit £242.2million compared to £213.1million in food.
M&S boss Stuart Machin told shareholders in November it is a 'critical objective to grow online participation' in clothing and home after delivering double-digit sales growth in the six months to 28 September.
Streeter said: '[The] ease of shopping and delivery has been upended. Even though stores are open, many simply don't stock the popular ranges from online.
'Fashion sales are likely to take a big hit particularly as the attack has come during the spell of warm weather when summer ranges would ordinarily be piling up in virtual baskets.
'While other retailers have not been immune to IT breaches, the depth of Marks and Spencer's problems in resolving the issue are worrying, and it may take some time to win back some more warier shoppers.'
It follows a remarkable run for M&S, which has seen sales balloon in recent years as its online 'click and collect' service and food offering revamp have proved popular.
Its shares are still up by more than 300 per cent over the last five years, though they have come under recent pressure amid an emerging supermarket price war and the growing strength of discounters.
And the group has been pursuing an ambitious agenda for its next stage of growth.
Clive Black, equity analyst at Shore Capital Markets, wrote last month of M&S: 'Food sales are still going very well, still gaining market share, whilst for [clothing and home] it is the same story, albeit we sense that the UK apparel market has been quite sluggish.
He also highlighted the retailer's 'strong' balance sheet and said M&S has the capacity to invest in processes to further improve productivity.
Black said: 'M&S is in good shape, to us, reflected in the narrative of management.
'That said, it is not a case of job done, with self-help needing to be seen through, competitive priorities having to be addressed as necessary, and growth opportunities ceased.
'The firm does so with a strong financial constitution with scope for building optionality around shareholder friendliness in time.'