Department store chain Debenhams (LON:DEB) has warned that trading in May and early June has been below plan as the company struggled in key markets and its rivals increased discounts. As a result of this, management have cut their guidance on full year pre-tax profits from c. £50 million to £35-40 million and announced that they would be cutting the planned level of FY2019 capital expenditure.
The company said that they would be improving their digital services in a bid to mitigate market conditions, as well as reworking their in-store experience and revitalising their designer offerings.
CEO Sergio Burcher said that “it is well-documented that these are exceptionally difficult times in UK retail, and our trading performance in this quarter reflects that. We don’t see these conditions changing in the near future and, because it is our priority to maintain a robust balance sheet, we are making very careful choices about how we deploy capital“.
Shares in Debenhams were 18.05p at 12:45 BST, down by 7.91%.