Department store group Debenhams today reported a 2.7 per cent drop in annual profits and said it expects no let-up in competition as rivals battle to attract cash-strapped consumers.
The 200-year-old retailer, which has 238 stores across 29 countries, posted a pre-tax profit of £154 million for the year to 31 August, down from £158.3m a year earlier but in line with City forecasts.
Sales rose 2.5 per cent to £2.78 billion, with like-for-like sales – which strip out the effect of store openings – rising 2 per cent.
Chief executive Michael Sharp said he was pleased with the performance in the face of “very difficult” trading conditions, highlighting a 46.2 per cent jump in online sales, which account for 13.2 per cent of the total.
He added: “Whilst consumer confidence may be showing signs of improvement, we expect that household incomes will remain under pressure from inflation growing ahead of wages.
“With this in mind, we remain cautious about the strength and pace of any consumer recovery in 2014 and expect the marketplace to remain highly competitive.”
Debenhams’ board proposed a final dividend of 2.4p a share, to be paid on 10 January.