M&S (MKS Stock) shares rise despite collapse in clothing sales

Marks & Spencer's share price increased by over 5% despite the British retailer reporting an 88% drop in full-year profit which reflected the impact on clothing sales of the COVID-19 pandemic. Marks & Spencer announced it plans to close 30 shops and move another 80 over the next 10 years as part of its turnaround plan. Despite M&S already closing or relocating 59 main stores, as well as cutting 7,000 jobs across stores and management, the company remains optimistic about profits for this year but warned that a return to dividend payments was unlikely. On the other hand, investors remain optimistic about the prospects brought by the recent joint venture with Ocado which has already proved to be beneficial, contributing £78m of profit with one in four Ocado deliveries being an M&S product. As the company continues to adjust to the extreme circumstances, like many other major retailers, it is having to shift its priorities and morph parts of its business model by also partnering with big players in the relevant sectors i.e delivery. While it remains to be seen if this will continue to be sustainable for the long run, investors seem confident, which has reflected in the share price.