Marks & Spencer to cut 1,230 jobs

Marks & Spencer Group Plc, Britain's largest clothing retailer, reported the steepest sales decline in about nine years and plans to cut about 1,230 jobs by closing stores and eliminating positions at its head office.

Revenue at outlets open at least a year fell 7.1 percent in the fiscal third quarter, the London-based company said yesterday in a statement. That beat the 8.3 percent median estimate of five analysts surveyed by Bloomberg News. The job cuts represent about 1.6 percent of Marks' 75,000 workforce and will help cut costs by as much as 200 million pounds in fiscal 2010.

"Challenging economic conditions" are expected to continue for at least the next 12 months, Chief Executive Officer Stuart Rose said in the statement. Britons made fewer Christmas shopping trips as unemployment rose and consumers made more purchases on the Internet. Marks began offering discounts more than a month before the holiday, leading it to forecast a 1.75 percentage point decline in full-year gross margins.