MARKS & Spencer is still deliberating on whether or not to close a batch of its European stores.

A spokesman for the troubled retailer said reports it was about to announce the closure of one-in-five of its European outlets were "pure speculation".

He said: "We are reviewing all of our business operations, but at this moment there is no announcement to be made about store closures."

M&S runs 38 stores on the Continent, employing more than 3,500 staff.

The stores are typically smaller outlets, but still carry the same general merchandise and food products sold in the UK.

Of the 38 stores, 18 are in France, nine in Spain and the rest are shared between Belgium, Germany, Luxembourg and the Netherlands.

It is believed the stores in Belgium, Luxembourg and the Netherlands could be targeted for closure.

M&S has already closed four stores in Germany and two in France in 1999.

The retailer's European stores performance has slumped along with the rest of the group.

In 1997, the firm's Continental division generated £38m in profits. Last year it reported a loss of £6.1m. In the first half of this year those losses have widened to more than £10m.

There has been speculation that M&S could close as many as seven of its Continental outlets.

The spokesman said M&S was reviewing all of its business in a bid to get the retailer "back on track".

Its fortunes have continued to slide despite bringing in the experienced Belgian retailer Luc Vandevelde to run the business last year.

Mr Vandevelde, now chairman and chief executive of the group, has given himself until January to improve trading.

Retail analysts believe M&S has concentrated its Continental operations on the wrong sort of space in the wrong towns.

They have urged M&S to pull out of Europe and concentrate on its operations in the UK.

M&S is currently conducting a review of its UK operations but has no plans to close more stores at the moment. M&S shares closed up 9 at 222