Debenhams CFO Resigns After Massive Profit WarningIBTimes UK

As of 1100 GMT, the Debenhams stock price fell by just over 14% to 71.31p after saying that poor festive retail sales would mean it have to cut prices and take a hit on profits.

It has forecast profit before tax for the first half of its fiscal year to be in the region of £85m (€102m, $140.47m), a 26% plunge from last year. Analysts had previously expected a first-half pretax profit of £112m.

Debenhams also added that "the retail section as a whole has been highly competitive with an unprecedented level of promotional activity."


Debenhams' gloomy outlook was exacerbated by its rivals' apparent Christmas trading success.

John Lewis Partnership said on 16 December that it saw a second week of soaring online sales as it enters the festive trading period.

The employee-owned partnership, which operates John Lewis department stores and Waitrose supermarkets, said online sales lifted 22% in the week to 7 December on the year before.

It was the second week in a row that online sales made up a third of overall trade. Total sales lifted 1.8% on the year to £144.5m, despite a sharp real terms decline in wages for UK consumers.

Meanwhile, online retail sales are predicted by accountancy giant Deloitte to hit £5bn over Christmas 2013. Though this is only an eighth of the total £40bn retail sales anticipated over the festive period.