Debenhams rushes out surprise update after its shares plunge to record low
Debenhams looked to quell investor concern about the company's financial situation by rushing out a surprise trading update today which showed profits were slightly below expectations.
The firm shocked the market by releasing its results a month early, saying it expected profits to be within the market range of £31m to £36m, falling just short of its expected target of £35m to £45m which it reported in June.
Shares in the company dropped today following reports over the weekend the company had brought in KPMG to advise on a number of restructuring options including a company voluntary agreement (CVA) or store closures.
The department store's share price plunged 17 per cent this morning before recovering slightly to sit 12 per cent down.
Read more: Debenhams share price crashes as firm considers restructuring options
At its results on 25 October 2018, Debenhams said net debt would come in at £320m, in line with guidance and with some headroom on its £520m medium term facilities.
"The market environment remains challenging and underlying trends deteriorated through the summer months," said chief exec Sergio Bucher.
"Having put in place a leaner operational structure and strong leadership team, and taken action to strengthen our financial position, we are well equipped to navigate these market conditions and take advantage of any trading opportunities that emerge."
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Debenhams chairman Sir Ian Cheshire added:
As we stated in June, the board continues to work with its advisers on longer term options, which include strengthening our balance sheet and reviewing non-core assets. This activity is in order to maximise value for shareholders and protect other stakeholders, including our employees.