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Profits woe for Debenhams
DEBENHAMS blamed very difficult conditions as annual profits slipped after a mixed year for the department store chain due to volatile weather.
The retailer posted a 2.7 per cent drop in pre-tax profits to £154m for the year to August 31 following a tough first half after Januarys snowstorms saw it warn over profits, while dismal spring weather dampened demand for new season ranges.
But Debenhams, which has 238 stores in 29 countries, including 156 in the UK, said it was pleased with its performance after an impressive online sales hike helped offset some of the earlier trading woes.
The firm has been linked with a move to convert the Darlington offices of The Northern Echo and its sister publications into a department store, however a Debenhams spokesman said there were no immediate plans to move into the town.
Like-for-like sales rose 2 per cent overall in the year to August 31, with online revenues a star performer for the group, rising by 46.2 per cent to £366.3m and offsetting a 2.7 per cent drop in comparable store sales.
Online sales accounted for 13.2 per cent of total annual turnover, up from 9.3 per cent the previous year, with a quarter coming via smartphones and tablet computers.
Debenhams last year set itself a target to boost online sales to £600m within three to five years.
Chief executive Michael Sharp followed other high street retailers in cautioning over subdued consumer spending in the year ahead.
He said: The past year has not been without its challenges and I believe despite the improved news about the economy, the UK consumer remains under pressure.
The drop in Debenhams profits follows a resurgent previous year, when profits rose 4.2 per cent after a sales revival.
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