DEBENHAMS, the high street department store, yesterday bucked the retail gloom by reporting a strong summer of sales growth, propelled by a 40 per cent annual increase in online sales.
The group increased like-for-like sales excluding value added tax by 3.7 per cent between 24 June and 1 September this year, helping boost annual sales growth overall by 1.6 per cent in the 12 months to 1 September.
Online sales grew 40 per cent in the year leading up to 1 August, well ahead of the online sales market, which grew 13 per cent in the same period, according to Kantar data.
The business said profit before tax for the year is expected to be ahead of last year’s figure of £157.7m but its gross margins would be 30 basis points lower than last year.
Shares in Debenhams have risen 67 per cent over the last year compared to a 16 per cent gain for the wider FTSE 250.
Chief executive Michael Sharp said: “To deliver like-for-like sales growth in these extremely challenging market conditions is highly creditable.”
Debenhams’ performance is in sharp contrast to rival Next, which gave a more gloomy outlook for the retail space after a 0.2 per cent annual increase in revenues excluding VAT for Next Retail up to July 2012.
Debenhams shares were muted yesterday on the back of the news.