Debenhams blames snow for dip in first-half profits

DEPARTMENT store chain Debenhams has blamed the late January snow for a 5.4 per cent fall in profits during the first half of its financial year.

Debenhams blamed the dip in profits on the poor weather. Picture: Jane Barlow

However, shares in the retailer jumped 5 per cent to 84.45p as analysts welcomed a lack of surprises following last month’s profit warning.

For the six months to 2 March, Debenhams posted a pre-tax profit of £120.3 million, down from £127.1m for the same period a year ago, despite a 3.6 per cent rise in revenues to £1.3 billion.

Sales in the UK rose by 3.9 per cent, and online sales jumped 46 per cent, but profits took a knock because of discounts.

Investec analyst Bethany Hocking said: “Market share gains continue and online growth is impressive, but we continue to have some concerns on both gross margins and costs.”

The interim dividend was held at 1p.

Data from the Office for National Statistics yesterday showed a 0.5 per cent year-on-year fall in retail sales last month as the cold weather and snow hit sales of spring fashions.