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Business News

Resurgent Debenhams plans expansion in a move set to create 1,700 jobs


Department store Debenhams hailed a resurgent year on the high street as it announced plans to open another 17 UK stores over the next five years.

The move - which is set to create 1,700 jobs and add more than £150 million in sales - comes on top of a nationwide store revamp programme which has seen 18 shops modernised over the past year.

Debenhams is also ramping up its overseas expansion drive, with plans to boost its international franchise by another 20 over the next four years and increase online orders to a further 30 countries.

The group revealed its expansion plans as it reported a 4.2% rise in pre-tax profits to £158.3 million for the year to September 1 after a recent sales revival.

Exclusive ranges from a star line-up of fashion designers - including Henry Holland and Julien MacDonald - helped the group grow its share of the competitive womenswear market, with group-wide like-for-like sales up 1.6% excluding VAT over the year.

The locations for the 17 new stores in the pipeline include Cheshire Oaks, Fort Kinnaird, Beverley, Wandsworth, Scunthorpe, Darlington, Shrewsbury and Newport, South Wales.

Debenhams, which has 155 UK stores, said it was committed to "reinvigorating the British high street" as it unveiled the latest store expansion plan, which builds on the nine new UK outlets announced last year.

Chief executive Michael Sharp said retailers were battling against a "very difficult market", but added the group expects to continue bucking the trend.

He said: "We believe that customers are acclimatised to the new economic reality.

"Whilst we don't anticipate a significant change in the economic environment in 2013, we expect to make further progress during the year."

Debenhams has benefited from revamped stores and its Life Made Fabulous TV advertising campaign.

Customers have also responded well to its exclusive Designers at Debenhams ranges, with the group adding fresh designers including German-born Markus Lupfer and Marios Schwab, while online and overseas sales have boosted results.

Debenhams posted a 39.8% leap in online sales to £250.6 million in the year, prompting it to increase its target to £600 million from £500 million.

The international arm, which includes the Magasin du Nord chain in Denmark, saw sales rise 2.7%, or up 17.2% when including franchise stores.

Debenhams has 85 overseas stores and plans to increase this to 150 over five years.