By Ahmed Abdelsalam
Marks & Spencer chief executive Stuart Machin has accused the Labour government of delivering one of the "biggest tax grabs in history" through its autumn Budget, warning the retailer faces an "onslaught of costs" despite a sharp rise in half-year profits.
Budget impact on costs
Machin said the Budget unveiled by Chancellor John Healey last week was a "whole lot of nothing" and would lead to tax hikes for the company. He noted that even the headline changes to business rates would add £10 million to M&S's bill. The retailer said it has absorbed around £35 million in extra costs over the past half-year from packaging taxes, higher pay and national insurance contributions, and disruption linked to the Middle East conflict.
Profits surge but below 2024 levels
Adjusted pre-tax profits more than doubled to £403.2 million for the 26 weeks to September 26, up from £184.1 million a year earlier. However, the figure remains lower than the same period in 2024, reflecting weaker fashion, home and beauty profits and higher costs. Total sales rose 16.2% to £9.25 billion.
Food division drives growth
The food business reported a 13.9% jump in sales, boosted by an 11.9% increase in volume sales as well as new store openings and investment. Fashion, home and beauty sales grew 17.5% year on year, supported by the recovery of online operations after last year's cyber attack.
Cyber attack legacy lingers
Machin said the fashion, home and beauty division still felt the "long-tail impact" of the cyber incident that halted online sales for about six weeks around Easter 2025 and disrupted logistics. Store sales were also dented by an extended period of hot weather over the summer.
Cautious hiring outlook
The company is "cautious about recruitment" as it manages rising employment costs and fragile consumer sentiment. Machin added that M&S enters the second half in a strong position, with solid performance in October.
