Department store chain Debenhams is expected to report stagnant results on Wednesday as it struggles to keep up with high street competitors.
Debenhams predicts that like-for-likes will remain flat for the third quarter as a result of pressures from clothing price deflation and falling shopping centre footfall.
James Collins, Analyst from Stifel noted that the group could see sales fall as it takes a hit from “fire sales” at BHS.
“March and April were difficult for the clothing market and while the weather was more supportive in May, industry data suggest ongoing sales declines and significant deflation,” he said.
“Footfall data also suggest weak shopping centre and high street trends.”
“Hence, against a relatively good third quarter last year, we expect Debenhams to report a group like-for-like decline of -1% to -2%” Collins added.
The trading update follows last month’s announcement that Amazon Fashion Boss Sergio Bucher will join Debenhams as its new Chief Executive this week. Bucher faces the challenge of mending the retailer’s performance amid a challenging retail climate.
Debenhams posted strong half-year results in April with a 5.5% rise in group pre-tax profits to £93.8m to February 27.
