News

Marks & Spencer has been forced to reduce dividend payments by a third as a result of the "uncertain economic climate".

Chairman Stuart Rose revealed that group dividend payments had been dropped to 15p from the current level of 22.5p, as the company announced results for the year to 28 March 2009 and entered its 145th year of trading.

Profit before tax fell 35% to £706.2m for the group for the 2008/2009 financial year, despite sales growing by 0.4% to £9.1bn during the same period.

M&S has completed a review of its business and while validating its existing objectives to manage the company through the downturn, it concluded that it needs to speed up changes to the business.

Ian Dyson has been appointed to lead the company's '2020 Doing the Right Thing' campaign, created to implement changes to the way M&S services customers and operates its business.

Objectives laid out by the business in November include retaining market position in general merchandise, improving  performance in the food sector and upholding ethical standards laid out in the company's environmental agenda, Plan A.

Under the scheme, M&S has changed the emphasis of its use of recycled plastic bottles from clothes to home products, such as bedding.

In the 2008/2009 financial year the company increased the amount of two litre plastic bottles it used to make recycled polyester to 37 million, nine times the amount used in the previous financial year.

Rose said the retailer would maintain a cautious outlook for the remainder of the year.

"As we start our 125th anniversary we do so with an unrivalled reputation for quality, value, service, innovation and trust. These core values are as important as they ever have been."

M&S opened 32 new stores in 2008/2009, taking the total number of stores to 296 in 40 locations.