Department store chain, Debenhams has reported it will be increasing closure plans from 10 to up to 50 under-performing stores over 3-5 years, as it announced preliminary results for the 52 weeks to 1 September 2018.
The group lost £491.5m, against profits of £59m the year before. Like-for-like sales declined 2.3% with constant currency LFL at (2.7%), with the UK market background remaining volatile in the second half of the year.
Despite the closure plans and LFL fall, the group delivered above-market digital growth of 12% supported by improved mobile and customer experience
The company, which currently operates 166 branches, most of which feature cafes or restaurants, also accelerated cost reduction activity with £12m savings achieved, annualising to £20m.
CEO Sergio Bucher commented, 'It has been a tough year for retail in 2018 and our performance reflects that. We are taking decisive steps to strengthen Debenhams in a market that remains volatile and challenging.
'Working with our new CFO Rachel Osborne, and the board, I am determined to maintain rigorous cost and capital discipline and to prioritise investment to achieve profitable growth. At the same time, we are taking tough decisions on stores where financial performance is likely to deteriorate over time.
'Debenhams remains a strong and trusted brand with 19m customers shopping with us over the past year. Our transformation strategy is gaining traction, with positive results from new product and new formats, general acclaim for our store of the future in Watford and digital growth that is outpacing the market.
'With a strengthened balance sheet, we will focus investment behind our strategic priorities and ensure that Debenhams has a sustainable and profitable future.'