Thu, 18th Jul 2019
Debenhams is asking lenders for a £50 million cash buffer, as it prepares for what it expects will be a difficult festive trading period.
Thee department store fell into difficulties in April, and was rescued by a team of lenders as a part of a restructuring bid that was completed in May. Sources close to the management say that the company is still finding trading tough, just as the rest of the high street is, and that they are still managing to trade within the targets that were put in place as a part of the rescue bid.
Lenders are positive about the company’s plans and the hope is that the appointment of new leadership will help to turn the company around. So far they have engaged in a round of store closures, and managed to negotiate rent cuts for remaining stores which should help to improve the stability of the company.
The retailer is thought to be planning to use a £50 million cash buffer to help it to get through the Christmas period. The buffer would be useful for funding a round of price cuts that would allow it to fight for market share in what is a highly competitive high street. So far, they have seen reduced demand for homewares and clothing, and other department stores, such as House of Fraser, have reported similar issues. Top Shop, Miss Selfridge, and Evans are also finding life difficult on an expensive and competitive high street.