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House of Fraser sales flat in ‘very challenging environment’

House of Fraser sales were in line with last year at £573.3m for the 26 weeks to July 30, while gross profit inched up £2.5m to £207.2m.

House of Fraser womenswear autumn 16

House of Fraser womenswear autumn 16

House of Fraser womenswear autumn 16

EBITDA fell to £1.1m, due in part to a £3.9m reduction in financial services income.

Online sales increased by 17.8% on a like-for-like basis, ending the period accounting for 20.7% of total sales.

The retailer is adding new brands including AllSaints, Monsoon and Mulberry to its portfolio, as well as six Hamleys concessions.

It will complete five store refurbishments by the end of October, rounding off 12 refurbishments in the past two years. It will also anchor a new shopping centre development at Rushden Lakes in Northamptonshire, which is due to open next summer.

House of Fraser will open its first store in China in Nanjing later this year, with an official opening ceremony scheduled for the end of the year.

“Inspired by our iconic Frasers store in Glasgow, the new store in Nanjing will provide a unique retail experience for the Chinese market, offering a broad range of exciting international and local brands to our customers,” the firm said.

Sales for the first eight weeks to 24 September fell 2% on the same period last year amid volatile trading and disruption from the refurbishments taking place at five stores.

Chief executive Nigel Oddy said he expects the “uncertain economic situation to remain for some time”, but remains confident that the firm is in a strong position to maximise trading in the second half, particularly around the all-important Black Friday and Christmas trading period, when the firm typically delivers around 85% of annual profit.

“The UK retail sector is facing significant change in structural dynamics as consumers shopping habits and delivery expectations continue to evolve,” added executive chairman Frank Slevin. “Under the leadership of our strengthened management team we are, however, highly confident in our ability to navigate these changes and position House of Fraser to deliver on our customers’ demands.”

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