Debenhams Group returns to profit as turnaround gathers pace
Debenhams Group has reported a 14.6% rise in first half adjusted EBITDA to £24 million as its turnaround gathers pace.
In the six months to 31 August, reported EBITDA was £19.7 million, compared with a loss of £3.5 million at the same time in the previous year. Debenhams said the group’s exceptional costs fell by 82.4% to £4.3 million in the period.
Subscribe to TRBGross merchandise value (GMV) before returns edged up 1.8% to £863.8 million, with growth accelerating from 0.5% in the first quarter to 2.9% in the second.
The Debenhams brand grew by 14.1% and accounted for around 42% of group GMV in the half year. During the period, the group’s marketplace reached a record 38.9% of GMV, up from 32.7% a year earlier.
Debenhams Group also reported statutory pre-tax profit of £28.3 million, compared with a loss of £17.9 million last year.
Giving an update on more recent progress, Debenhams described trading in September as good, with further accelerated growth. For the full year, it expects to deliver GMV growth and adjusted EBITDA of no less than £59 million, as previously announced.
Dan Finley, Debenhams group chief executive, said: “The turnaround continues at pace. The group has returned to GMV growth, gross margins are expanding and returns rates lowering.
“Reported EBITDA has increased over 600% and profit before tax has improved to £28.3 million. This is the first time the group has delivered positive profit before tax since August 2021. I am pleased to report that net debt is expected to be negligible at year-end.
“This is significantly ahead of our original guidance provided at the start of the year. I see material opportunities ahead and we are fully focused on maximising them.”
In September, Debenhams Group sold its Nasty Gal fashion brand to White Space Group New York, which operates as WSG Brands, for $16 million.
