- Prachi Singh |
Debenhams plc, in its trading update for the 6 weeks and the 18 weeks to January 5, 2019 said that against a challenging market backdrop, the group is currently on track to deliver current year profits in line with market expectations, supported by further identified cost savings. Group gross transaction value for 6 weeks declined 3.8 percent, with group like-for-like sales down 3.4 percent. In this period, the UK declined by 3.6 percent, with weak store footfall offset by growth in digital.
Commenting on the company’s performance, Sergio Bucher, Chief Executive of Debenhams, said in a statement: "We responded to a significant increase in promotional activity in the market, particularly in key seasonal categories, in order to remain competitive for our customers."
For the 18 weeks, group gross transaction value declined 5.6 percent, with like-for-like sales down 5.7 percent. The UK was down 6.2 percent with International down 3.5 percent. The company added that digital sales have grown by 4.6 percent across the period.
Debenhams further said that the UK trading environment has continued to be volatile, as expected, with clear evidence that customers have been seeking out promotions. As a result, the company reinstated some promotional activity in order to be competitive and manage inventory tightly, which is expected to result in some gross margin erosion in the first half.
After a slow start to the season, group digital sales rose 6 percent in the 6 week period over peak against a strong comparative performance, delivering two year growth of over 20 percent supported by improved mobile conversion and customer experience.
Picture:Debenhams press area