Sales for the retailer were flat at £10.6bn in the financial year ending 1 April. Like for like sales were down by 1.9%.
The biggest drop was in clothing and home sales which fell by 3.4% in the final quarter. M&S chief executive Steve Rowe said the fall was partly due to a decision to sell more clothes at full price.
Food sales performed better, dropping 2.1% in the last three months of the financial year.
Excluding one-off costs, M&S' pretax profit was down 10.3% to £613.8m.
In a statement, M&S also revealed that marketing costs declined by 12.6% to £162.7m year on year.
This, the retailer said, was due to "reduction in activity and the more effective use of our marketing budget, such as our Christmas campaign where we increased customer views while reducing costs, as well as the annualisation of the launch of Sparks last year."
During the last financial year M&S ended its 16-year relationship wth Rainey Kelly Campbell Roalfe/Y&R (now Y&R London) and earlier this month launched its first ad campaign by Grey London.
The retailer is also bringing in Halfords chief executive and former McDonald's UK boss Jill McDonald to turn around M&S' struggling non-food business.
Rowe said M&S had made improvements to its non-food business and was starting to stabilise market share.
He added: "As we anticipated, the planned restructuring of M&S has come with a cost and has impacted profits, but the business is still strongly cash generative and we reduced our net debt.
"Looking ahead, we will continue our programme of self-help in a tough trading environment."
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