When the giant Marks & Spencer grumbles about trading trends, the retail stores sector as a whole is likely to get a touch of the jitters. M & S chairman Sir Richard Greenbury intimated this week that "tougher and tighter" trading conditions may force group profits lower this year, a singular event as it would mark the first profit decline for 40 years. Margins are presently being squeezed by the strength of sterling, the economic crisis in Asia and, in addition, the group is facing into a massive £2 billion investment programme. In the year to end March last, pre-tax profits rose 6 per cent to £1.2 billion sterling, an outcome below analysts' expectations.

The Irish division continues to perform well on the back of the booming economy. Stephen Costello, M & S general manager for Ireland, says that the flagship outlet in Grafton Street "outperformed even out own expectations" in its first full year of trading. The group intends to increase its presence in the Republic's retail market by 30 per cent by the end of the year, despite the difficulty in finding suitable sites for new stores in the provinces.

Shareholders receive a 10 per cent increase in total dividends to 14.3p a share.