LONDON — A chilly autumn has already set in at Marks & Spencer plc.

The British retailer, which is attempting to retool its image and claw back market share following weak performance and a takeover attempt by retail tycoon Philip Green in July, said on Tuesday that sales in the 10 weeks to Sept. 18 fell by 2.7 percent.

The home category registered the largest decline, with sales falling 20.8 percent. The company reiterated in a statement that the home product was too contemporary for the M&S customer. As reported, the much-heralded M&S Lifestore project, spearheaded by Vittorio Radice, has been canceled and replaced with a more traditional collection that focuses on the core categories of bath, bed and kitchen.

Clothing sales fell by 5.4 percent, and M&S conceded that clothing performance during the summer season was “difficult,” with poor sales in core women’s wear, lingerie and children’s wear. The Per Una line of women’s clothing, however, performed well in the period.

The only product category that grew in the 10-week period was food, where sales rose 2.9 percent. The company reported percentage changes only, and will release a trading update for the second quarter on Oct. 12, and interim results for the first six months on Nov. 9.

The M&S statement said that due to lower sales levels and higher stock commitments in the spring-summer season, markdown costs in the first half are expected to increase by about 20 million pounds, or $35.6 million at current exchange rates.

The company said it was too early to gauge how successful the fall season was going to be; however, sales of knitwear and formalwear have been “encouraging,” although some areas of casualwear have been poor.

The statement added that management was taking steps to slash costs and improve margins. M&S said the increase in operating costs for the first half is expected to be less than 1 percent, compared with previous guidance of 3 percent. That trend is expected to continue throughout the year.

The competitive pressure facing M&S was further underscored Tuesday when Tesco plc, the U.K.’s largest food retailer, and which is selling more and more apparel, reported a 24 percent increase in pretax profits to 822 million pounds, or $1.46 billion, on a 12.2 percent rise in sales to 16.5 billion pounds, or $29.4 billion, for the first half. Apparel sales alone climbed 39 percent, Tesco said.

This story first appeared in the September 22, 2004 issue of WWD. Subscribe Today.

M&S issued the sales update in conjunction with the details of its proposed 2.3 billion pound, or $4.1 billion, tender offer to shareholders. As reported, M&S management proposed the offer as a sweetener for shareholders in its defense against Green’s advances over the summer.

Regarding the tender offer, M&S said tenders will be accepted in the range of 3.32 pounds to 3.80 pounds, or $5.90 to $6.80, per share, and the offer will be structured using a strike price mechanism.

The closing date of the offer is Oct. 22, following an extraordinary general meeting in London.