Debenhams is under renewed financial pressure as shares in the embattled retailer tumbled again after its worst-ever daily decline yesterday.
After enduring a plunge of just over 21 per cent of its share value yesterday, the department store’s shares fell again by almost nine per cent earlier this morning.
It comes amid news that a number of suppliers have allegedly stopped working with Debenhams.
According to Drapers, the suppliers had cited cuts to Debenhams’ credit insurance and fears of missed payments.
“Many suppliers don’t use credit insurance,” a Debenhams spokeswoman told Drapers.
“Those that have used it historically are well aware of the current situation and work with retailers to manage things accordingly.”
Analysts have said the news was the reason for Debenhams coming under further pressure, with estimates of its market value coming in between £64 million and £81.5 million.
The upper estimate is almost 85 per cent down for the year to date, and also lower than the £90 million that Sports Direct paid to acquire rival House of Fraser in a pre-pack administration scheme in August.
Debenhams’ shares could be bought for less than 5p each today, compared to when it started the year at 35p each.
The plunge in shares follows recent weak trading updates as well as downgrades from influential credit ratings agency Moody’s.
Last month, Debenhams recorded the biggest financial loss in its 240-year history as well as plans to close up to 50 stores in the next three to five years to help fund a turnaround plan.
The planned store closures could mean the loss of up to 4000 jobs.