Debenhams (LON:DEB) has issued another profit warning as sales continue to slow.
The retailer warned that its previously released profit projections “were no longer valid”.
Back in January, the retailer said in its Christmas trading update that it was “on track to deliver current year profits in line with market expectations”.
However, Debenhams has now withdrawn this outlook, citing financing costs as well as an uncertain trading environment.
Sergio Bucher, the chief executive of Debenhams, said: “We are making good progress with our stakeholder discussions to put the business on a firm footing for the future.
“We still expect that this process will lead to around 50 stores closing in the medium term.”
He continued:
“Our priority is to secure the best outcome for the business and all our stakeholders, whilst minimising the number of store closures and job losses. To do this, as we have said before, we will need the support of both landlords and local authorities to address our rents, rates and lease commitments. I would like to thank our staff – and all our stakeholders – for their continued support through this period, as we work to deliver a sustainable future for the company.”
Debenhams is one of many high street retailers which have been struggling as of late. Last year, House of Fraser narrowly avoided falling into administration after an eleventh hour rescue deal by Mike Ashley’s Sports Direct.
Meanwhile, high street music and film retailer HMV was recently bought out of administration by Canadian businessman Doug Putman, after racking up heavy profit losses.
Shares in Debenhams are currently trading -6.83% as of 10:26AM (GMT).
