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Debenhams CFO exits days after profit warning

Debenhams’ chief financial officer Simon Herrick has stepped down with immediate effect, just two days after the department store issued a profit warning.

Herrick, who has been at the business for a little over two years, will formally leave the company on February 7. Neil Kennedy, director of finance, will take on interim responsibilities while a replacement is recruited.   

Debenhams chief executive Michael Sharp said: “On behalf of the board, I would like to thank Simon for his hard work and contribution over the past two years. We wish him well in the future.”

Herrick’s departure comes two days after Debenhams released an interim statement showing like-for-likes had risen a mere 0.1% in the 17 weeks to December 28, with clothing the “weaker” performing category.

Online sales rose 27% for the period, accounting for 15.6% of total sales compared with 12.4% for the same period last year.

The statement said gross margins had declined “due to product category mix and higher markdown”.

The business noted that it had not seen “the anticipated final surge in sales in the last week of the period and as a result we expect the need for additional markdown to clear stock in January and February”. 

Gross margins for the first half are now expected to fall by between 80 and 100 basis points, while profit before tax is expected to drop to £85m from £114.7m in 2013.

Readers' comments (8)

  • Average isn't good enough anymore! Average product sold in below average environment - and continual discounting. Debenhams have been doing the same old thing for years and now realise (hopefully) this means they don't have a loyal customer base. It's always been about short term gains - Rob Templeman's strategy I believe!

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  • Why would anyone shop in Debenhams at full price?
    Just wait until the weekend and they will have a discounting weekend on.
    They have shot them selves in the foot by discounting every week-customers just wait for it.

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  • Debenhams is slowing going down the pan - and its all of their own making.

    Discounting isn't the way forward, but the company is woefully short in having the right people on board to make their stores a success.

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  • First comment spot on, finally the chickens come home to roost on a tired mundane strategy, much like the product and the so called designers at Debenhams, it needs a full change of Management they have all been there way too long and only know one way to trade.

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  • A Co run by 'Financiers...if you can call them that' rather than retailers...funny how Drapers has been slow in spotting this!

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  • Aren't all PE owned retail businesses run by financiers? Oh yes...and none in fashion are working!
    Rob Templeman would not be moved from this strategy..then like Terry Leah, left "just in time". Didn't Drapers give Mr Templeman a lifetime achievement award?

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  • One person taking the can for a whole Management team that continue to flog an outdated strategy that once made a lot of money for private investors at the expense of the Debenhams Brand. Tough market conditions are sighted as the reason, really, take a peak at the results from your peers, Next, John Lewis, HoF, wake up and smell the coffee.

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  • Debenhams-- Deadenhams more like it

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