What: Marks and Spencer has announced its plan to pay a dividend for the first time since the start of the pandemic.

Why it is important: Marks and Spencer's decision to pay its first post-pandemic dividend reflects the company's strong financial performance and confidence in the market.

The company reported pre-tax profits of GBP 326mn in the first half of the year, a 56.2% increase from the same period last year. The surge in profits was driven by a nearly 15% rise in food sales, reaching GBP 3.8bn. The company declared an interim dividend of 1p per share, signalling its confidence in its financial position and market performance. Following the announcement, the retailer's shares surged by 9%.

Marks and Spencer attributes its success to several factors, including favourable market conditions and resilient consumer demand. The company also benefited from the exit of competitors from the market, further strengthening its position. However, despite these positive developments, the company remains cautious about potential challenges in the future. It anticipates issues such as higher interest rates, deflation, geopolitical events, and erratic weather, which may impact its operations.

Marks and Spencer to pay first post-pandemic dividend