Department store Debenhams has revealed its interim results for the 42 weeks ending June 21st.
Gross transaction value for the period was 1.3 per cent than the same period last year. Although like-for-like sales were down by 0.6 per cent for the 42-week period, over the ten weeks since the last trading update at the interim results, like-for-like sales have grown by 1.0 per cent.
The chain is continuing to gain market share across key product categories, with own bought and designer ranges doing well. As a consequence, gross margin guidance for the year as a whole of flat to plus 20 basis points is unchanged.
Net debt at the end of the year is expected to be in line with market consensus. Progress has been made on de-leveraging the balance sheet as set out at the presentation of Debenhams' interim results in April. The cost saving target of £20m has already been achieved and will take full effect in 2009.
Plans to improve the customer experience through brand consolidation and SKU rationalisation are on target and will be achieved by the start of the new financial year.
Debenhams' new 130,000 square foot flagship store opened in Liverpool at the end of May and is trading ahead of expectations. A further two department stores in Dunfermline and Blackpool are due to open before the end of the financial year and five department stores, including White City in October, and two Desire stores in 2008/09.
"In light of the tough trading environment across the whole UK retail sector, we are pleased with customer response to our new ranges and, as a result, our improving sales performance for the period," said Rob Templeman, chief executive of Debenhams. "The strength of Designers at Debenhams is particularly pleasing. We continue to take market share across our key product categories."