Debenhams posts rise in sales after Black Friday and Christmas trading boost
PUBLISHED: 16:00 12 January 2016
Department store chain Debenhams shrugged off the unusually mild winter weather to post a rise in sales thanks to bumper Black Friday and Christmas trading.
The group reported a 1.9% increase in like-for-like sales for the 19 weeks to January 9, with growth of 1.8% in the final seven weeks.
It hailed a successful Black Friday and record performance in the Christmas week, adding that it continued to rein-in promotions despite widespread discounting on the high street in December after unseasonably warm weather, with full-price sales up 5%.
Debenhams, which has around 160 UK stores out of more than 250 worldwide, said it cut back on certain clothing lines such as winter coats to overcome the impact of the warmest December in over 100 years.
Rivals such as Next and Marks & Spencer were hit as shoppers shunned heavy coats in favour of lighter-weight items in November and December.
Shares in Debenhams raced more than 14% higher on the better-than-expected festive performance.
Outgoing chief executive Michael Sharp, who announced plans last October to leave in 2016, said the sales rise shows turnaround efforts are continuing to pay off.
He said: “This performance is evidence that our strategy is working.”
The update comes after Debenhams posted its first rise in annual profits for four years in October, when underlying pre-tax profits rose 2.9% to £113.5 million.
Retail experts praised the group’s Christmas trading.
Keith Bowman, equity analyst at Hargreaves Lansdown Stockbrokers, said: “The update offers firm reassurance.
“A planned reduction in outerwear clothing stocks has clearly played its part, while management’s push to increase online sales continues to progress. A focus on non-clothing categories is also reaping rewards, with new store opening further contributing.”
Debenhams, which also trades as Magasin du Nord in Denmark, said online sales lifted 12.1% over the 19 weeks and 15.4% in the key seven-week period.
On a constant currency basis, like-for-like sales rose 3.5% over the 19 weeks.