Marks and Spencer on Tuesday announced it saw pre-tax profits rise 19.6% at £308.2m, up from £257.8m. M&S, which saw sales fall by 5.4% in the first quarter but rise by 1.3% in the second quarter, warned the trading environment remained “difficult” although it was optimistic for the Christmas period. M&S said designer George Davies, who announced last month he would leave the company’s Per Una division, will stay on and become chairman of the fashion department until July 2008.

Last month M&S reported its first quarterly sales rise in two years, following new ranges and a store revamp under a revival plan launched by chief executive Stuart Rose. The new figures are a further reflection of the measures introduced by Mr Rose: “We have tightened up our costs,” Rose told BBC Radio Four’s Today programme. “The improving trend on sales is very encouraging.”

Mr Rose further stated the company had a large market share and was a solidly run business. Overall, sales rose by 0.6% to £3.65bn in the 26 weeks to 1 October. Analyst Simon Irwin of JP Morgan said it was a good performance in light of the current weak High Street trading climate.

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M&S also announced the appointment of Steven Sharp to the board as executive director for marketing, e-commerce, store design and development. The firm said it is to accelerate its store modernisation programme next year, as part of its continuing recovery push, with Mr Sharp set to play a major role in that.

Mr Rose said that £500m of capital expenditure had been set aside to pay for the refurbishment, already under way, of its 416 stores. “Our first priority has been to get the product right, then to get the stores refurbished,” said Mr Rose.

Last year, Arcadia Group owner Philip Green offered 400p a share for M&S before he dropped his £9.1bn attempted takeover.

Image: M&S graph