M&S' shares dropped 78 pence, or $1.54 at current exchange, to close at 240 pence, or $4.75.
The company released a trading update a week early after Stuart Rose, chairman of M&S, said sales had encountered a further slowdown over the past three weeks. "We've seen pretty volatile trading April, May and June," said Rose during a conference call Wednesday.
U.K. sales in the 13 weeks to June 28 declined 0.5 percent during the period, while clothing sales fell by 3.6 percent, and home sales, by 5.1 percent. International sales rose 24.5 percent.
On a like-for-like basis, U.K. sales declined 5.3 percent, while general merchandise sales, which include clothing, dropped 6.2 percent. While food sales grew 1.6 percent during the period, on a like-for-like basis, they were down 4.5 percent. Food sales have been one of the retailer's strongest-performing categories for years, and the drop might indicate how deep the U.K.'s economic woes are biting into consumers' wallets. M&S focuses on fresh and prepared foods, which generally are more expensive than those sold at other British supermarkets.
In a further sign of how seriously M&S takes the decline in food sales, the retailer on Wednesday replaced the executive who oversees the division. John Dixon, who was previously director of home at M&S and director of M&S Direct, the company's e-commerce site, now will oversee food. Dixon replaces Steven Esom, who was appointed head of food in June 2007. Dixon will report to Rose.
"Steven has done a good job for the business, but he came in at a time when we were facing a more robust economy," said Rose. "We're now in a slightly different place, and we need a different horse for a different course."
Rose described the current economic climate in the U.K. as "the fastest and most severe slowdown since the early Nineties," during the conference call.