Marks & Spencer Capital Markets Day Overview
Marks & Spencer Group plc used its Capital Markets Day on Tuesday to outline medium‑term growth ambitions. The company said it will double its full‑year 2026/27 dividend to 8.4p per share, up from 4.2p, and that future dividends will grow at least in line with earnings.
The retailer set a target of mid‑to‑high single‑digit sales growth with profit growth expected to exceed sales growth. It also expects to generate free cash flow in each of the next three years, providing flexibility to invest for growth while returning more cash to shareholders. Following the announcement, M&S shares rose 0.7% in early London trading.
Business‑Unit Targets
- Food business: After delivering more than 50% annual sales growth since fiscal 2022, the Food division aims to double sales over time and achieve an operating margin of around 5%.
- Fashion, Home & Beauty division: The division plans to raise online participation to about 50% across 180 stores, targeting operating margins above 10% in both online and offline channels.
- International business: The focus will be on building the global brand through capital‑light channels, without specific financial targets disclosed.
Cost and Balance‑Sheet Priorities
M&S reaffirmed its commitment to a structural cost‑reduction programme of £600 million by fiscal 2028. Over the past four years the group has restored its balance sheet to an investment‑grade credit rating, moving to a net‑funds position with strong liquidity. Maintaining this strong balance sheet and investment‑grade rating remains a priority.
> "Delivering these ambitions will require continued investment in the M&S proposition and the transformation of the Company’s end‑to‑end operating model, with the aim of driving productivity and operating leverage as the business grows," the group said.