Shares in Marks & Spencer (M&S) slumped by 6 per cent today after Citigroup, one of the retailer's two joint brokers, cut its full-year profits forecast by 20 per cent.

In a note entitled "Every Rose has its Thorn", referring to Stuart Rose, M&S's executive chairman, Richard Edwards, an analyst at Citigroup, said: "With growing input cost pressures across both the general merchandise and food businesses, the profit outlook still remains opaque and earnings forecast confidence low."

Earlier this week, M&S stunned investors with a shock profits warning after reporting a 5.3 per cent fall in like-for-like sales across the business in the 13 weeks to June 28, its worst performance since 2005.

Mr Edwards said today he expected sales of general merchandise to fall by 7 per cent in the year ended March 31, 2009, and food revenue to decline by 5 per cent.

Citigroup, which is house broker alongside Mortgan Stanley, also slashed profit forecasts to £730 million for the current financial year, against a previous consensus expectation of £850 million.

Mr Edwards also cut forecasts for next year, from £800 million to just £570 million.

In early trading, M&S shares fell as low as 6 per cent to 221p before recovering slightly to 227p. M&S is now worth just £663 million - 63.7 per cent less than its valuation in July last year.

Times Recommends

• US jobs plunge in worst fall since 1974
• Brown will press banks to pass on full rate cut
• Woolworths axes 450 staff amid firesale