Debenhams Plc, today reported FY results up to August 28th, saying it's sales were up 9.6% to £2,564.3 million, largely as a result of the acquisition of the Danish group Magasin du Nord last year, but that it's sales were flat on a LFL basis. |
The firm has improved it's margin during the year, largely as a result of reducing concession space in Q4 last year, to provide room for more own bought product. As a result profit before tax and exceptional items was 20.3% higher than last year at £145.3 million.
The business was strongly cash generative in the year with cash inflow from operating activities of £299.2 million (2009: £241.0 million). Net debt at the end of the year on 28 August 2010 was £516.8 million. This was an improvement of £73.5 million over the position at the end of the last year.
Six new stores opened during 2009/10. Of these, three were department stores including a flagship store in Newcastle-upon-Tyne which opened in February 2010 along with Carmarthen in April 2010 and Bury, Greater Manchester in July 2010. In addition, three Desire stores opened in Kidderminster (September 2009), Monks Cross (October 2009) and Witney (October 2009). Margins at Desire – which sell 95% in-house ranges – are substantially higher than the full-line department stores, by between 500 and 600 basis points.
Rob Templeman, Chief Executive of Debenhams, said:
"We are pleased with the performance of the business in 2010 which was a year of structural change for Debenhams. We had said that we would judge our own success this year in terms of profit growth and believe that an increase in headline profit before tax of more than 20% on a one year basis and 37% on a two year basis is a creditable performance. We have now delivered five consecutive halves of profit growth despite the difficult trading environment.
"Although we remain concerned about the general retail environment, we are encouraged by the start to the new financial year which has seen positive like-for-like sales and gross margin in the early weeks. However, the important Christmas trading period is clearly yet to commence. As we look forward, we will continue to focus on our core strategy of self-help initiatives focused on managing gross margins, driving market share and growing through expansion and investment. In spite of the uncertain outlook, there is much to be positive about our business which will enable us to make further progress over the next year."
Looking for Businesses for Sale or Commercial Property agents, find lettings and investment property in the UK? www.ukbusinessproperty.co.uk
The shares closed last night at 71.50p valuing the firm at £920 million.
Related Articles -
Commercial Property, Business Property, UK Commercial Property, Business for Sale,