Debenhams lifts forecasts thanks to designer ranges
DEPARTMENT store Debenhams yesterday said it expects to deliver higher annual profits, despite a slight drop in sales.
Chief executive Rob Templeman said that he was happy with analysts’ forecasts of a ten per cent lift in profits to £122-124m, from £110m the year before.
Like-for-like sales were down by 3.8 per cent in the six months to the 29 August, compared to a 3.6 per cent decline in the first half.
Debenhams converted 530,000 sq ft of trading space set aside for concessions, like Oasis and Warehouse, into space to display its own brand ranges that now account for 80 per cent of sales.
The group said sales at its concessions fell by 19 per cent over the half, while sales at its Designers at Debenhams range jumped by 14 per cent.
The group yesterday announced the well-flagged launch of London Fashion Week designer Henry Holland’s new range for Debenhams (pictured), which is expected to improve sales further.
Debenhams also said it had increased its gross margin by 0.7 per cent.
Templeman said: “Although it is early days, we are encouraged by the launch of our new brands which we expect to benefit gross margin during the course of the year. “
The group, which raised £323m from shareholders in June, said it has already shaved £50m off its £650m debt pile.