Profits slip at Debenhams

Debenhams: New chief executive after nine years

One of the UK's largest department store groups saw its profits slip in the last year.

Pre-tax profits at Debenhams were £129.6m in the year to the end of September, compared with £138.8m in the previous year.

Total sales did grow 1.4%, and the decline in profits - which was was less than expected - can be attributed to higher advertising costs and store refurbishments.

Debenhams is the UK's third largest department store in terms of sales, behind Marks & Spencer and John Lewis.

High street battle

Many high street retailers have been hit by increased competition.

Competition has been at its most fierce in the clothing market.

Debenhams has sought to reposition its business and now only about 40% of its sales are in the clothing sector.

But its shares have not been able to escape the gloom that dogs most retail stocks. On Monday, shares closed at 177.5 pence, having underperformed the sector by 30% this year.

The group is to pay shareholders a total dividend of 10.7 pence, nearly 3% higher than this time last year.

Terry Green, Debenhams' chief executive for almost nine years, stepped down last month. He then joined BHS.

His resignation saw trading director Belinda Earl take charge at the retailer.

Belinda Earl, a former Harrods employee, joined Debenhams in 1985, rising to trading director in 1997.