"We expect trading conditions to remain tough throughout 2008," said Sir Stuart Rose in a third-quarter trading statement Wednesday, adding U.K. market conditions had begun to deteriorate through November and December.
"We are well-positioned with a strong product offer and better-than-ever values across our business," he added.
On Wednesday, Nationwide Building Society, a British bank, mortgage, loan and credit card company, reported its consumer confidence index fell for the third consecutive month in December. The company blamed economic uncertainty, and higher food and oil prices.
In Wednesday's statement, M&S reported its worst quarterly performance in two years: U.K. sales rose 2 percent overall, although like-for-like sales, which do not take into account store openings, dropped 2.2 percent.
During the period, clothing sales fell by 1.2 percent, home increased by 3.2, and food rose by 5.1. M&S remains Britain's largest clothing retailer. The company only gave percentage changes for the quarter and will report full fourth-quarter and year-end results on May 20.
M&S said it did not discount in the run-up to Christmas and that marked-down merchandise has already cleared after the Christmas sale. Prices were slashed up to 75 percent during the sale.