DEBENHAMS chief executive Michael Sharp became the latest retail boss yesterday to call on the government to overhaul the way in which it determines business rates, describing the current system as “outdated”.
“It is clear that the current calculation is archaic and does not fit for the modern consumer world of today,” Sharp said. However, he warned the tax was unlikely to be reformed soon because of the income it generates for the indebted government.
Despite rising rates, the retailer is pushing ahead with its expansion and plans to launch 16 stores over the next four years. Sharp said there were still many key shopping areas in the UK where it does not have a presence like Cribbs Causeway shopping centre near Bristol and Bluewater in Kent.
His comments came as the company reported a 2.7 per cent decline in full-year pre-tax profits to £154m, dented by costs from the revamp of its Oxford Street flagship and the closure of its Romanian franchises earlier this year.
Sales rose 2.5 per cent to £2.78bn, with like-for-like sales up two per cent.
Sharp said it was a year of two halves, with profits dented by the cold snap in the Spring before recovering thanks to the heatwave in the second half.
Debenhams is revamping its 156 store estate to boost sales and tackle declining footfall. It has opened more restaurants, increased space dedicated to click and collect and introduced tough screen monitors, with sales up six per cent at refurbished stores.