Debenhams reports Christmas sales increase
Debenhams saw its like-for-like sales rise by 4.9% in the four weeks to 10 January as it benefited from its Christmas marketing campaign. Group transaction value grew by 5.9%.
The department store said it saw record group sales in the seven days prior to Christmas and a 10.3% increase in sales during Black Friday week. Online orders on Black Friday itself surged by 125%.
Debenhams chief executive Michael Sharp said: “I am pleased with our performance in the critical Christmas trading weeks, driven by our strength in a diverse range of product categories and a strong marketing campaign focussed on gifting. Our performance steadily improved following the well documented challenges in the clothing market in the autumn. We now have a competitive online proposition with next day delivery to home and next day click and collect, which customers took full advantage of and which performed well over Christmas.”
Demand for click and collect increased during the Christmas period and in the final days peaked at 38% of online orders. Online sales surged by 28.9% in the four week period.
Debenhams said it had 10 fewer days of promotions which meant that there was a 12.1% increase in sales of full price items.
In the seven weeks to 10 January, the department store’s gross transaction value rose by 3.3% while like-for-like sales edged up 2.4%.
During the 19 weeks to 10 January, however, like-for-like sales dipped by 0.8% despite a 0.2% rise in gross in transaction value.
Debenhams said its performance in the 19 week period reflected challenges in the clothing market and its strategy to be less promotional as part of an ongoing focus to increase the percentage of full price sales. As planned, the department store launched its sale on Boxing Day and delayed the start of its Blue Cross event by one week to 8 January.
Looking ahead to the rest of the financial year, Debenhams said it does not expect any significant change in consumer confidence and that the trading environment will remain competitive.
Debenhams added that its gross margin for the year is likely to be towards the lower end the guidance of +10 to +40 basis points due to a strong performance from lower-margin categories such as beauty and some concession brands and a “challenging season in clothing”.
