Bad weather hits Debenhams' profits but store puts confidence in new clothing ranges
Thursday 18 April 2013
Debenhams today pledged that Britain's second-biggest department store chain would make progress over the rest of the year after first-half profits were hit by the snow in January.
Pre-tax profits fell 5% to £120.3?million which was bang in line with the figure put out with last month's profit warning. The final two weeks of January, which coincided with the last part of Debenham's main sale, saw sales down by 10%. For the six months as a whole, sales rose by 3.7% and as chief executive Michael Sharp put it: "Though January was disappointing, we still grew like-for-like sales for the fourth consecutive half year which isn't bad given the economic environment."
Last week rival Marks & Spencer said clothing and general merchandise sales fell by 3.8%.
But Sharp said: "Our spring and summer ranges are very strong. We have brought in new designers with Stephen Jones for women's hats and Patrick Grant for formal menswear. We continue to grow market share particularly in womenswear. But, like everyone, I can wait for it to start being sunny."
He added that the £25 million makeover of Debenham's flagship store in Oxford Street was both on budget and on time. He said: "We are adding an extra floor of shopping space where we had offices on the fifth floor. We are transforming the boring concrete exterior with a cladding of small metal plates which move in the wind and reflect light. We are making Oxford Street the standard for Debenhams across the UK. Many watchers judge us on that store so it must be the best."
Investors perked up on the outlook and Debenhams shares rose 6.5p to 87p.
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