Jan 10, 2019

Debenhams reports tough trading over Christmas

UK department store chain Debenhams has finished a difficult year with a more than 3 per cent fall in sales over the Christmas and new year holiday period and has abandoned the sale of its Danish subsidiary Magasin du Nord. Debenhams gave three profit warnings last year and its share price fell almost 90 per cent but it had hoped that a new focus on "Premium" gifts would boost sales. Asked if Mike Ashley, whose Sports Direct group owns 29 per cent of Debenhams, might be a potential source of funds, she said: "He is not one of our lenders." In November, Mr Ashley revealed he had offered to lend Debenhams £40m or inject additional equity but had been rejected. A "Company voluntary arrangement", which would allow Debenhams to cut its expensive store rental bill, remains a possibility. Online sales were a brighter spot, rising 6 per cent rise over the six-week period.

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