Debenhams' reported pre-tax profits fell by 44.2% to £59.0m in the 52 weeks to 2 Sep but the group said it made good progress in setting the foundations for its new strategy, Debenhams Redesigned. Underlying pre-tax profits of £95.2m were down by 16.6% and group EBITDA fell 7.0% to £217.0m. Group gross transaction value rose by 20% to £2,954.1m and the dividend was maintained at 3.425p per share. Like-for-like sales grew 2.1% with UK LFL at 0.0%, reflecting growth in Destination categories; strong digital momentum; and a weaker H2 trading environment. Beauty sales grew by 5%; Food by 8%, whilst clothing declined by 0.5%, broadly in line with the UK market. Digital sales grew 12.7%, driven by mobile orders up 57% in the UK Group gross margin rate declined 30 bps, in line with guidance. As expected, further 20 bps markdown improvement in the year was offset by sales mix dilution. Full price sales grew 1.7% UK EBITDA declined 10.1% against a tougher trading background in H2 but mitigated by tight cost management. International EBITDA grew by 8.0%, with Magasin du Nord in Denmark having a solid year in a tougher trading environment, whilst our Irish business benefited from restructuring under examinership. Chief executive Sergio Bucher said: 'We are making good progress with implementing our new strategy, Debenhams Redesigned, and are encouraged by the results from our initial trials, as well as the number of exciting new partners who want to work with us. 'There is a lot to do but I am delighted with the enthusiasm and flair shown by my colleagues as we embark on this journey. 'I'd like to thank the whole team for delivering these results against a background of rapid change in the business. 'The environment remains uncertain and we face tough comparatives over the key Christmas weeks. 'However, we are well prepared for peak trading and the early signs from our activity to date confirm that we are moving in the right direction towards a successful and profitable future for Debenhams.'
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