Profits have fallen by 2.7 per cent at department store group Debenhams as it revealed its end of year results.
Despite the dip in profits in a ‘challenging marketplace‘, group like-for-like sales inched up 2 per cent to £2.78bn as the group opened international stores in regions such as Iran, Pakistan and Russia and plans to open in Libya.
Debenhams, which have modernised 12 stores and opened 20,000 sq ft of space, have invested significantly into its multi-channel offering. Online sales grew by 46.2 per cent to £366.3m this year.
It said in a statement that its medium-term online sales target remains £600m. Michael Sharp, Chief Executive of Debenhams, said he was pleased with the year‘s performance in ‘very difficult conditions.‘
“We gained market share in key categories, demonstrating the competitiveness of our product offer. We continue to deliver growth and additional customer benefits through our strong multi-channel capabilities,” he said.
“At the same time, we are working hard to ensure our UK stores adapt to the challenge of their changing role in a multi-channel world.”
He said he expected household income to remain under pressure as inflation continues to outstrip wages.
Mr Sharp added: “We remain cautious about the strength and pace of any consumer recovery in 2014 and expect the marketplace to remain highly competitive.”
David Alexander, Consultant at Conlumino, said the results represented good progress for Debenhams and that it had made ‘some real strides‘ in its online offering. But he said the weather was the story of Debenhams‘ sales over the summer.
“All retailers are subject to a degree of exposure to changeable weather, but Debenhams‘ frequently promotion-led response leaves it more open to short-term hits and misses than most,” he said.
Earnings per share rose 4.1 per cent to 10.2p