Marks & Spencer 13-weeks UK sales up 3.6 pct

LONDON — British retailer Marks & Spencer Group PLC said Wednesday that sales rose 3.6 percent in the 13 weeks ending July 3, but it was cautious about the outlook for the rest of the year. The figure does not account for new store space opened during the period. Including new stores, total UK sales were up 4.8 percent, with general merchandise up 7 percent and food up 2.9 percent. International sales were up 0.9 percent, affected by adverse currency movements and "difficult trading conditions in certain markets," the company said. "We are cautious about the outlook for consumer confidence and spending," the company said, citing the government's austerity drive and next year's rise in sales tax. "The update is solid if a little unexciting, with sales marginally outpacing expectations," said Richard Hunter, analyst at Hargreaves Lansdown Stockbrokers. "In the background, concerns still linger around the staff pension deficit and ongoing pressure on margins," Hunter added. Kate Calvert at Shore Capital agreed it was a strong update, but rated the shares as "sell" because general consumer demand is expected to be weak and because she believe M&S may have to invest more heavily in its food business. —AP