Focus on own-brand goods pulls Debenhams sales down
Like-for-like sales at UK department store chain Debenhams fell 0.4pc in the 42 weeks to the middle of June, with the performance blamed on the retailer's continuing strategy of improving gross margins by stocking more own-brand products.
Gross margin performance for the period was strong and should exceed guidance for the year, Debenhams said in an interim statement yesterday.
The department store operator, the UK's second-biggest after Marks & Spencer, has 11 outlets in Ireland and employs over 2,000 people here.
The company said that new designer ranges at its stores, including those by Ben de Lisi and Henry Holland, have been "well received" by customers and performed in line with expectations.
The retailer has also reached an agreement in principle to buy the Faith footwear concession business in Debenhams stores from the administrators of the business. There are 115 Faith concessions in Debenhams stores. Debenhams is also in the process of refinancing its debt facilities, a process it said was progressing well and should be completed within the next few weeks.
Chief executive Rob Templeman said that the group remains cautious about the strength of the overall UK retail market and the level of consumer confidence. However, he said he hopes macroeconomic pressures will be mitigated following the acquisition of Denmark firm Magasin du Nord, an expanding multi-channel business and ongoing store refurbishment.