Annual profits up 20.6% at Debenhams

A good performance in the year to August 28 2010 has seen Debenhams increase sales, margins, trading profits and market share.

Annual profits up 20.6% at Debenhams

Gross transaction value for the period grew 9.6% to £2,564.3m, although like-for-like sales were flat.

Gross margin for the year was 70 basis points higher than last year, the gain driven by stronger own-bought sales versus concessions, careful stock control and markdown management – which offset supply chain inflation.

The department store chain also saw profitability move ahead during the year, with pre-tax profit up 20.6% to £151.0m, compared with £125.2m in 2009.

Debenhams opened six new stores during 2010, of which three were department stores in Newcastle-upon-Tyne, Carmarthen and Bury, Greater Manchester. The retailer is also investing in a store refit programme, and refurbishments now completed in Manchester, Glasgow and Swindon have resulted in strong sales and an uplift in margins.

The multi-channel business also continued to grow strongly in 2010, with Debenhams Direct sales up 88.4% to £103.8m in the year. The retailer says that weekly visits have now reached around 1.6m.

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