Marks and Spencer 1998 Annual Report Download - page 5

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ourselves further from the competition and provide
new selling opportunities for our unique product
ranges. N eighbourhood stores continue to progress
well and further openings are planned.
Operating profit for financial services
increased 18.1% to £89.4m. This is one of our
fastest growing areas and contributes more than
8% of the Group’s total operating profit. We
completed an expansion of our financial services
headquarters in Chester, enabling us to house a total
of 1,200 people to deal with increased demand.
During the year we increased UK selling space
by 410,000 sq ft. We opened four new stores,
including a large edge-of-town store at Cribbs
Causeway near Bristol and 16 stores were extended.
The Group purchased 19 carefully selected stores
from Littlewoods, at a cost of £192.5m, all funded
from cash. These will provide some 600,000 sq ft of
extra selling space in prime town and city centre sites
close to existing M arks & Spencer stores. The new
stores will become operational towards the end of
1998/99, during which year more than 1.0m sq ft
will be added altogether, including a large edge-of-
town store at Bluewater Park near Dartford in Kent.
There is no longer a typical M arks & Spencer
store. O utlets vary enormously in size and each is
laid out and merchandised for a specific purpose –
from a departmental store of 150,000 square feet
serving a wide area such as at Newcastle to a
sandwich shop in the City of London. O ur 43
departmental stores allow us to display our
expanding range of merchandise to good effect and
offer a more complete shopping service than ever
before. The extra space we are acquiring also
enables us to create a more comfortable and
convenient shopping environment – with improved
facilities for elderly people and parents with young
children, more and better fitting rooms and toilets,
and, in the larger stores, coffee bars or restaurants.
Against the background of a strong pound
and economic collapse in the Far East, our overseas
businesses generated total sales of £1.27bn, but
operating profits were heavily affected and, after the
costs associated with expansion, fell to £67.9m.
Outside the UK, sales in Europe made good
progress when measured in local currencies and we
OPERATING PROFIT FOR FINANCIAL SERVICES
INCREASED 18.1% TO £89.4M,
CONTRIBUTING MORE THAN
8% OF TOTAL GROUP OPERATING PROFIT
MA RKS A ND SPENCER p.l.c. 3