House of Fraser set for growth after surge in sales

The group, in which Ayrshire entrepreneur Sir Tom Hunter has an 11 per cent stake, has written to its suppliers confirming it has successfully changed its banking agreements to allow it to ramp up expansion after seeing a recent surge in sales and earnings.

Same-store sales have leapt by more than 10 per cent in the five weeks since the end of January.

The group, whose stores include Jenners in Edinburgh, saw earnings rise by just over 20 per cent in the year to 31 January, thanks to a strong second-half after focusing on more profitable in-house brands.

There had reportedly been concerns over news a month ago that it was seeking to relax its banking terms, while credit insurer Atradius had not reinstated cover for suppliers after withdrawing insurance about 18 months ago.

But in a letter to suppliers, House of Fraser chairman Don McCarthy assured them that lending agreement changes would give it more room to grow. He wrote: "House of Fraser has received overwhelming support from our lending group that will enable the group to move forward with the next phase of our growth strategy."

Expansion aims include moves to ramp up its online capabilities and in-house ranges, with the addition of labels such as Biba and Pied a Terre in womenswear, while continuing with an extensive store refurbishment programme.