Retailer Debenhams provided shareholders with a lift today after reporting that trading in the run up to Christmas had been “encouraging”.
But the high street giant tempered its comments about the financial year since September by sounding a note of caution on the general economic outlook.
In a statement ahead of its annual general meeting today, Debenhams added that trading during the next four weeks would still be crucial.
It said: “Nevertheless, we are encouraged by the performance we have achieved since the beginning of the current financial year.
“Looking forward we remain cautious about the general economic outlook.”
Debenhams will issue a more detailed trading update on 14 January but today’s statement offered a further sign that the group is over a summer sales slump.
In July, Debenhams’ market value tumbled almost 20% after it warned that margins were being hit by price cuts needed to shift unsold stock.
But chief executive Belinda Earl dismissed those problems as a blip in October as she reported a 5.1% lift in annual pretax profits to £153.6m.
She added that sales had also been gathering pace, helped by an improved clothing range and the launch of the Nectar loyalty card.
Like-for-like sales were up 4.6% in the seven weeks to 19 October, compared with 4.4% in the previous six months.
A new contemporary womenswear range “Spirit at Debenhams” – endorsed by former Eastender Tamzin Outhwaite – was launched for the autumn and the group is due to sell a Jasper Conran menswear range in the spring.
Debenhams has almost 100 stores in the UK and Ireland but plans to have 120 in five year’s time and 150 within the next 10.
EGi News 11/12/02
