Debenhams has reported a 7.3% increase in profit before tax to £113.5m for the year to August 29, breaking a four year cycle of profit decline.
Group like-for-like sales at the department store group were up 2.1% in constant currency. Gross transactional value was up 1.3% to £2.9bn.
Debenhams maintained its group gross margin rate, with a 90 basis points improvement year-on-year.
The business said a “positive sales momentum continued against background of refocused promotional activity.” Own brand full price sell-through increased by 7%, following a reduction of 17 days in the promotional calendar in the financial year - a total reduction since spring 2014 of 42 days.
Five new UK stores will open this autumn including Bradford where Debenhams will be the city’s only department store. Shops in Rugby and Wandsworth have opened this year and the group said they are trading well.
Michael Sharp, chief executive of Debenhams, who announced this morning (October 22) that he was stepping down in 2016, said:
“We have delivered profits in line with market expectations, reflecting further progress against our strategic priorities. We have had an encouraging start to the year, with strong new product launches which have been well received by our customers, and we are in good shape to build on last year’s strong performance over peak trading.
“Consequently, we are increasingly confident in the direction of the business and as a result we will accelerate our new initiatives, such as the roll-out of our successful space optimisation trials and new international growth opportunities.”