Marks & Spencer considers temporary store closures

Marks & Spencer is considering temporary store closures and the pub chain owner JD Wetherspoon warned that sales are plummeting as the coronavirus continues to hammer high street businesses.

M&S said it is seeing “substantial declines” in its clothing and home business because shoppers are staying at home, and it is redeploying a “significant” number of staff to support its supermarket business.

M&S warns of temporary store closures due to Covid-19 as firms await wage rescue plan – business live

“It is too early to make any reasonable forecast for revenues in the next financial year but we are planning on the basis of a prolonged downturn in demand for clothing and home,” the company said. “We are preparing for the contingency that some stores may have to close temporarily.”

The company, which scrapped its dividend and warned that it might miss its lowest profit-guidance target, also said that it was not benefiting as much from panic buying as the major supermarket chains.

“We have benefited on a small scale as customers stock up but our heavy bias to chilled and fresh [food] means we are not seeing the forward-buying uplift experienced by the major grocers.”

Meanwhile, the pub group JD Wetherspoon has issued a profits warning and cancelled its dividend. All its 874 pubs in the UK remain open. Sales were down 4.5% in the week to 15 March but, after the prime minister’s advice on Monday to avoid pubs, the decline has been at a “significantly higher rate”.

How can I protect myself and others from the coronavirus outbreak?

The World Health Organization is recommending that people take simple precautions to reduce exposure to and transmission of the coronavirus, for which there is no specific cure or vaccine.

The UN agency advises people to:

  • Frequently wash their hands with an alcohol-based hand rub or warm water and soap
  • Cover their mouth and nose with a flexed elbow or tissue when sneezing or coughing
  • Avoid close contact with anyone who has a fever or cough
  • Seek early medical help if they have a fever, cough and difficulty breathing, and share their travel history with healthcare providers

Many countries are now enforcing or recommending curfews or lockdowns. 

In the UK, NHS advice is that anyone with symptoms should stay at home for at least 7 days.

If you live with other people, they should stay at home for at least 14 days, to avoid spreading the infection outside the home.

The company has stopped capital expenditure, which, along with the government’s business rates holiday and credit guarantee faculties, it says will provide sufficient liquidity to “maintain operations at a substantially lower level of sales”.

On Friday the Bank of England said it would cancel annual financial stress tests on banks to allow them to concentrate on lending to help businesses through the crisis.

  • Heathrow has said that it remains “committed” to staying open to enable some passenger services and air freight to continue. The company has taken action including a recruitment freeze, cost cuts and cancelling executive pay.

  • InterContinental Hotels Group, the owner of Holiday Inn, Crowne Plaza and InterContinental chains, said demand for hotels is the lowest it has ever seen. The company has made $150m in cost savings, including reducing marketing spend and “relaxing brand standards”.

  • The online estate agent Rightmove has reported a dramatic fall in homebuying and activity from tenants. It is cutting fees to agency, new home and commercial customers by 75% for four months, at a cost of £65m to £75m.

  • Mike Ashley’s Frasers Group, formerly known as Sports Direct, has issued a profit warning and said it will no longer be providing financial guidance.

  • Travis Perkins is to pause the demerger of Wickes “in light of the current extreme stock market volatility”.

  • The estate agents Foxtons has warned of a “material disruption” to its business and said it has fully drawn down a £5m credit facility to boost its cash reserves.

  • In some rare positive news, CMC Markets, the financial spread betting firm founded by the City tycoon Peter Cruddas, upgraded its full-year profit forecast after trading in March surged to more than double normal levels.

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