Marks & Spencer is to slow the rate of openings for its Simply Food chain as part of a host of cost-saving measures after its half-year profits fell by a third to £297.8 million.

The company opened 70 Simply Food stores in the year to September but food like-for-likes still fell 5.3 per cent in the first half. Overall like-for-likes fell 5.7 per cent, with general merchandise down 6.2 per cent.

“Simply Food will be slowing down as part of the cut in capex,” said finance director Ian Dyson. He said those that are opening will generally be franchise stores where the investment in the store is put in by the franchisee, but insisted that “we still believe in the Simply Food programme”.

Executive chairman Sir Stuart Rose admitted that M&S was losing market share in food, but insisted that the rate of decline had slowed since he replaced head of food Steven Esom with M&S lifer John Dixon earlier this year.

Prices have been cut on 560 core items as part of its Wise Buys programme and Rose claimed that M&S is now cheaper than Waitrose.

He said he was committed to improving relationships with food suppliers, which he admitted had suffered as a result of drawn-out discussions over terms. “Protracted negotiations with the food supply base took us away from innovation,” he said.

In textiles, where Rose said M&S is holding market share, the retailer is to launch a new brand called Portfolio. This is aimed at the over-45 female customer, a core part of the M&S market, which head of clothing Kate Bostock said was being targeted aggressively by rivals such as Debenhams and House of Fraser.

Spending on store refurbishments and marketing is to be cut back in response to the conditions, but investment in new systems in the supply chain, stores and head office is to be increased. “The economic environment has changed and we have to cut our cloth according to our means,” said Rose, who was positive about Christmas. “This is a strong business in a very weak market,” he insisted.

Former head of retail for womenswear, Myriam Ben-Yedder has left M&S after six years with the retailer. Ben-Yedder, who left M&S this week, will join young-fashion brand Full Circle this month as brand director. Laura Mitchell has taken over as head of retail for M&S womenswear.

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