Debenhams sees H1 profit ahead of prior year

"As a result of higher sales and gross margin, EBITDA and profit before tax for the first half are both expected to be higher than last year and in line with market forecasts," the firm said on Tuesday.

Debenhams posted a 0.3 percent rise in sales at stores open over a year for the 26 weeks to February 27 and said it was winning market share.

That outcome compares with analysts' consensus forecast of flat like-for-like sales, according to a company poll, and a rise of 0.1 percent for the 18 weeks to January 2.

Gross transaction value increased 1.7 percent, compared with analysts' consensus forecast of up 1.5 percent.

Debenhams, with nearly 160 stores in Britain and Ireland and more than 50 franchised outlets overseas, is shifting from low margin concessions by devoting more space to own-brand products.

As own-brand products are lower priced than those sold through concessions, sales values are impacted. However, own-brand products are higher margin, so profitability improves.

The firm said its gross margin for the period was "significantly higher" than the previous year.

If forecast year-end net debt within the range of market forecasts.

Shares in Debenhams have nearly doubled over the last year, helped by a 323-million-pounds equity fundraising in June which put an end to worries about its debt.

The firm had been dogged by concerns about its borrowing since returning to the stock market at 195 pence a share in 2006 after two-and-a-half lucrative years in private equity hands.

The stock closed on Monday at 71 pence, valuing the business at 914 million pounds.

(Reporting by James Davey, editing by Mark Potter)