DUBAI: Saudi Arabia’s Fawaz Abdulaziz Alhokair said on Wednesday its franchise agreement in the kingdom with British retailer Marks & Spencer had ended, along with similar deals with a number of “non-performing” brands.
Marks & Spencer (M&S) said in an email that its franchised stores in Saudi Arabia were transferred to Al-Futtaim Group in 2018. M&S has 15 franchised stores in Saudi Arabia.
“We are focused on continuing to work with Al-Futtaim Group to develop and grow our business in Saudi Arabia,” M&S told Reuters.
M&S still has a partnership with Alhokair in Armenia, Georgia and Kazakhstan, according to M&S’s website.
M&S has more than 400 stores outside the United Kingdom, where it is a mainstay of shopping streets with more than 1,000 outlets. Its international business has been struggling, however, with revenues falling 14 per cent and underlying operating profit down 6 per cent in the year ended March 30, 2019.
Alhokair also said on Wednesday it made a first-quarter net profit of 224 million riyals ($60 million), down 10.1 per cent from the same period a year earlier.
The firm, which owns franchise rights for brands including Mango, Zara and Banana Republic in the Middle East, said a decline in sales during the quarter was driven by the closure of non-performing stores and the disposal of weak brands as the group presses ahead with a “portfolio optimisation strategy”.