A FLEDGLING economic recovery is likely to take time to feed into stronger consumer spending, department store group Debenhams said yesterday, as a hot summer and online growth helped to lift its quarterly sales.
Shares in the 200-year-old firm, which trades from 236 stores across 28 countries, rose as much as 4.4 per cent yesterday after it also said it was winning market share and would meet profit forecasts for its 2012-13 financial year.
Debenhams is modernising stores, including a £25m refurbishment of its flagship on Oxford Street, investing in new products and online sales channels, and expanding its brand internationally as it seeks to counter subdued consumer confidence with market share gains.
“Looking forward, we are confident in our strategy but are not expecting any rapid recovery in consumer sentiment and the marketplace remains highly competitive,” said chief executive Michael Sharp.
Debenhams said sales at stores open over a year rose 1.9 per cent in the 10 weeks to 31 August, its fiscal fourth quarter, as it won share in categories including womenswear and beauty.
That was in line with analysts’ forecasts, compared with a flat outcome in the 16 weeks to 22 June, and took growth for the full financial year to two per cent.
“The summer weather was undoubtedly helpful but we’ve grown market share which demonstrates that in a competitive market place the strategy is delivering,” said Sharp
Online sales were up 46.2 per cent over the year, well ahead of market growth of 14.4 per cent.