Debenhams warns 'volatile' trading conditions could hurt annual profits after sales drop
DEBENHAMS has warned that “volatile” trading conditions could hurt annual profits after a drop in sales over the past four months.
Debenhams issued profits warning as sales have slumped over the past four months
The company is undergoing a makeover under new CEO Sergio Bucher, with stores being “decluttered” and more staff dealing directly with customers to boost service, as it aims to become a destination for “social shopping”.
Like-for-like sales fell by 0.9 per cent in the 15 weeks to June 17, with higher sales of accessories and food and drink partially offsetting a weaker clothing market.
Mr Bucher said: “As industry data has confirmed, May was a tough month for retailers and we continue to see volatility in trading week to week.
We continue to see volatility in trading week to week
“As a result we are focused on delivering cost control and self-help through our ‘Fix the Basics’ plan.
"We continue to build good foundations for longer term growth.”
The company warned that ‘volatile’ trading conditions could hurt annual profits
Julie Palmer, partner at Begbies Traynor, said: “With success on the high street so inextricably linked to consumer confidence, recent news of falling credit card borrowing in May, negative real wage growth and weaker retail sales volumes all suggest a tightening of shoppers’ purse strings.
“Unfortunately, with Debenhams reporting volatile trading in recent weeks, it looks like the retailer is feeling the sharp end of this.”
Shares fell 1p to 43½p.