10th Sep 2018 13:25
LONDON (Alliance News) - UK department store chain Debenhams PLC said Monday it expects to post an annual profit in line with the current market range despite deteriorating market environment.
Shares in the department store chain were trading down 10% at 11.48 pence each.
The company said it expects annual pretax profit of GBP33 million, in line with the market expectations of between GBP31 million and GBP36.5 million. Earnings before interest, taxes, depreciation and amortisation is expected to come in at GBP157 million.
"We have continued to strengthen our financial position, including increasing headroom on our fixed charge covenant, in order to give us comfortable liquidity through the peak borrowing period, ensuring maximum flexibility amidst volatile market trading conditions," the company added.
Looking ahead, Debenhams said that the early weeks of the new season "have shown more positive trends and any sustained upturn would result in a rebound in our profit performance".
Chief Executive Officer Sergio Bucher said: "The market environment remains challenging and underlying trends deteriorated through the summer months.
"Having put in place a leaner operational structure and strong leadership team, and taken action to strengthen our financial position, we are well equipped to navigate these market conditions and take advantage of any trading opportunities that emerge."
Earlier on Monday, the Financial Times reported that Debenhams has asked KPMG to look at restructuring plans that could lead to store closures.
The restructuring options could include asking creditors to accept a compulsory voluntary arrangement, the FT said citing a person with knowledge of the matter.
https://www.ft.com/content/f0479334-b43e-11e8-b3ef-799c8613f4a1
Debenhams will issue preliminary results on October 25.
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