Marks & Spencer has announced a major profits slide, having seen its takings fall by almost a fifth last year.
The retailer's annual pre-tax pre-exceptional profits fell by 19 per cent to £618.5 million, from £805m last year.
At the same time, M&S have given no update on current trading, leading to media speculation that sales have fallen further in recent weeks.
Stuart Rose, chief executive, said condition were tough, but claimed the company was “on track”.
However, despite the news, the company’s shares rose nearly one per cent to 340p as the profits, although down, were in line with market forecasts.
In the 52 weeks to 2 April, M&S's total sales fell to £7.9bn from £8.3bn for the corresponding period last year.
UK retail sales fell 1.7 per cent to £7bn while like-for-like sales - which exclude sales from new store openings - were down 5.1 per cent over the period.
While clothing sales fell by 3.1 per cent, the performance on food was marginally better, with a rise of 2.4 per cent. However, on a like-for-like basis, food sales were 2.6 per cent lower than last year.
"Clearly we would like to do better," Mr Rose told the BBC. "Clearly it is tough. The economic climate has turned out to be tougher than we forecast but we are on track.
"I believe we have the foundations in place to drive the business forward," he added.
According to the company, initiatives planned for this year include the roll-out of its updated store design to a further 20 stores. M&S also plans to open about 10 stores in out-of-town retail parks.
It has also agreed a deal with BP to open Simply Food outlets at a number of BP petrol stations.
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