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Profits rise 5.5% at Debenhams following ‘record Christmas’ period

UK retailer Debenhams enjoyed its best Christmas ever while profits have jumped by a sizeable 5.5% in results posted to the stock exchange this morning.

The London-headquartered department chain saw pretax profit jump to £93.8m in the 26 weeks to 27 February, comparing favourably to the £88.9m it posted in the same period last year.

Debenhams Group, who have 253 stores in 27 countries, also enjoyed a modest 1.6% increase in gross transaction value in the same period, although this was undercut by a 3.7% decline internationally.

Most heartening for the multi-national retail group was its Christmas performance, which today’s financials credit to the rebalancing of its stock levels to non-clothing items, such as gifts and beauty products, along with the re-launch of its mobile app.

Michael Sharp, Chief Executive of Debenhams, said: “A strong operational performance resulted in a record Christmas, and further growth in first half profits against a good performance in the prior year.

“Our customers are responding positively to our multi-channel strategy, finding our mix of products and brands both compelling and great value for money.

“Although there is plenty more to do, we are on track to deliver full year results in line with market expectations. When I leave the business later this year I am confident that it will be in a good position to deliver continued sustainable growth under a strong and capable management team.”

It was also announced today that, following the announcement in October last year, Michael Sharp has officially handed in his resignation and that the process to appoint his successor is already well underway.

Commenting on Sharp’s imminent departure, Ian Cheshire, Debenhams non-executive chairman, added: “As this will be his last set of results, on behalf of the Board, I would like to thank Michael for his service as Chief Executive of Debenhams.

“He has led the business through an unprecedented period of change for the sector, leaving the business in good shape for the future as these results demonstrate.

“I am pleased that this means we can today announce an increase in the interim dividend, consistent with our progressive dividend policy. The foundations to deliver sustainable growth are in place and we are in the final stages of appointing a new CEO to lead the business.”