Department store chain increases market share with home range and reports strong sales of own-bought ranges.
Gross transaction value for the 26 weeks to February 27 saw a 1.7% increase on the same period last year. The increase in sales, coupled with a "significantly higher" gross margin, leads Debenhams to expect its EBITDA and pre-tax profit to see an increase on last year's figures.
Like-for-like (lfl) sales for the first half were up 0.3%. However, Debenhams believes the recent closure of concessions to make room for new and expanded own-bought ranges has had a detrimental impact on lfl sales of some 1.5% throughout the current financial year.
Debenhams reported an increase in its home market share, boosted by a higher own-bought mix and its Designers at Debenhams range.
Its multi-channel business, which incorporates its website, in-store ordering, click-and-collect, and international deliveries, saw an 80% increase in sales in the first half.
Debenhams chief executive Rob Templeman said: ""We are pleased with our first half performance which shows continued progress in delivering our strategy. In 2009 we were one of only a handful of retailers to increase sales, margins and profits and we have done so again in the first half of 2010. Against the backdrop of challenging trading conditions, we have delivered profit growth on a consistent basis for the past 18 months."
He added: "In the second half we will continue to focus on our self-help measures. The impact of the disruption we saw in the fourth quarter of last year due to the closure of concessions and the significant space shift will start to dissipate and we expect to benefit from enhanced space productivity in the second half from our new brands. Our strong own bought offer, not least the successful and exclusive Designers at Debenhams brands... will remain our key driver of growth."
The chain has opened four new stores during the 26-week period, including the 128,000 sq ft flagship department store in Eldon Square, Newcastle-upon-Tyne in February.