Rising profits prompt further job and store expansion by Debenhams

By KRISTY DORSEY
Published on 25/10/2012 20:30

DEPARTMENT store operator Debenhams is ramping up expansion plans following a rise in full-year profits from operations in both the UK and overseas.

The 239-strong chain will open a further 17 shops in the UK over the next five years, creating an additional 1,700 jobs. The expansion includes previously-announced plans for a third site in Edinburgh, with a 60,000sq ft store at Fort Kinnaird in the east of the city.

Debenhams defied tighter consumer spending to post a 4.2 per cent rise in pre-tax profits, which reached £158.3 million in the year to 1 September.

Sales in the UK, where Debenhams currently operates 155 shops, were 2.6 per cent higher at £2.2 billion, accounting for the lion’s share of group turnover, which came in at £2.7bn. On a like-for-like basis, which excludes VAT and store openings, UK sales rose by 2 per cent.

Chief executive Michael Sharp warned that market conditions would remain difficult, but added that he believed customers had become “acclimatised to the new economic reality”.

“Whilst we don’t anticipate a significant change in the economic environment in 2013, we expect to make further progress during the year,” he added.

Debenhams has benefited from store refurbishments and its “Life Made Fabulous” advertising campaign. The group intends to boost its marketing spend, including the launch next month of its first Christmas TV campaign in six years.

The group now aims to have a total of 150 franchises within five years. Debenhams currently has 85 stores overseas, including 71 franchises.