Debenhams issues profit warning as share price slumps

Troubled high street department store Debenhams has issed a profit warning, cutting its forecast from between £35m-£40m to around £33m.

The news comes after shares dropped by as much as 15% at one point. The company had earlier turned to KPMG to provide guidance on a route forward.

Sergio Bucher, chief executive, said: “The market environment remains challenging and underlying trends deteriorated through the summer months. Nevertheless the product and format improvements we have tested are gaining traction and we are ready to scale up some of our strategic activity ahead of peak. Having put in place a leaner operational structure and strong leadership team, and taken action to strengthen our financial position, we are well equipped to navigate these market conditions and take advantage of any trading opportunities that emerge.”

Sir Ian Cheshire, chairman, said: “As we stated in June, the board continues to work with its advisers on longer term options, which include strengthening our balance sheet and reviewing non-core assets. This activity is in order to maximise value for shareholders and protect other stakeholders, including our employees.”