Debenhams closes on new boss as first-half profits rise
Published 14/04/2016 | 08:49
Debenhams, Britain's second-largest department store group, said it was close to naming a new boss as it beat forecasts with a 5.5pc rise in first-half profit, putting it on track to meet full-year expectations.
Last October Michael Sharp announced he planned to step down as chief executive at some point in 2016 after five years in the job.
Debenhams said he formally submitted his resignation to the board on Thursday.
He will continue as CEO until his successor is confirmed to ensure a smooth handover.
Debenhams said it made an underlying pretax profit of £93.8m in the six months to February 27.
That was ahead of analysts' average forecast of £91m and the £88.9m it made a year earlier.
Sales rose 1.6pc to £1.63bn, with sales at stores open over a year up 1.1pc and its gross margin up 20 basis points.
The better performance reflects less discounting, fewer promotions, a decrease in the proportion of clothing in the overall product mix, and online service improvements.
“Although there is plenty more to do, we are on track to deliver full-year results in line with market expectations," said Sharp.
Analysts' average forecast for 2015-16 pretax profit is £118.2m, according to Reuters data, up from £113.5m in 2014-15.
Shares in Debenhams on Wednesday closed at 77.4 pence, valuing the company's stock at £954.4m.