Much of the upswing was attributable to one-off gains from property disposals, which generated 27 million pounds, or $53 million, and an exceptional pension credit, which added 95 million pounds, or $186 million, to M&S's net profits.
Profits before tax and exceptional items rose 4.3 percent for the year to 1.01 billion pounds, or $2 billion, marking the first time the retailer has delivered profits of over 1 billion pounds before tax since the 1997-98 financial year. Full-year sales grew 5.1 percent to 9.02 billion pounds, or $18.1 billion. All figures have been calculated at average exchange rates for the period.
"Despite tougher economic conditions in the second half, M&S has had a good year," stated Stuart Rose, chief executive of Marks & Spencer. "We expect market conditions to remain difficult for the foreseeable future, and are managing our business accordingly."
The chairman and ceo admitted business in the first few weeks of the 2008-09 financial year has remained hard. "Trading for the first seven weeks of the year has been mixed," he said.
As for last year's performance, clothing sales grew at a slower rate than the previous year, rising just 0.8 percent. They fell 1.5 percent during the fourth quarter of the year, compared with the same period last year, and declined 1.2 percent in the third quarter.
Rose said the company plans to double the size of its higher-end Autograph brand in the next three years to sales of 600 million pounds, or $1.18 billion, and extend its reach to include Autograph-branded flowers and dedicated gift shops. He also aims to slightly reduce entry-level clothing ranges to make up 28 percent of the offer, from the 30 percent it stands at now.
The executive added he is "considering" carrying cosmetics at M&S, along with a trial of branded food products. A spokeswoman for the retailer declined to comment further on the reports M&S is eyeing a link with Sephora.