NI Debenhams shops at risk from closure

Plan to axe 50 outlets in UK unveiled by retailer

DEBENHAMS has unveiled plans to axe up to 50 high street shops, putting five stores across Northern Ireland at risk.

The retailer employs 27,000 staff across the UK and Ireland, with its NI flagship store in Belfast’s CastleCourt complemented by outlets in Craigavon, Newry, Ballymena and Londonderry.

The retailer’s announcement yesterday is the latest blow to Northern Ireland’s retail industry, and comes after it was revealed last month that the store chain had called in auditors to consider closures and insolvency.

The closure plans, to be implemented over the next three to five years, were revealed on Thursday alongside a dire set of financial figures. Up to 4,000 jobs UK-wide are to be affected.

Debenhams took a £491.5m loss in the year to September 1 after being stung by exceptional write-downs of £512.4m, primarily relating to store and lease provisions, IT costs and impairment charges.

The loss compares to a £59m profit in 2017. A Debenhams spokesperson said: “We have identified up to 50 stores, accounting for under 15% of total sales, which are currently profitable, but where we do not see a long term future, we intend to exit over the next three to five years.

“This is an ongoing five-year programme and we are not disclosing a list of these stores.”

Sales for the year also slipped 1.8% to £2.9bn while like-for-like revenue fell 2.3%.

As part of the shake-up, De- benhams will look to take £130m of costs out of the business, including suspending the dividend.

Debenhams Chief Executive, Sergio Bucher, said: “It has been a tough year for retail in 2018 and our performance reflects that. We are taking decisive steps to strengthen Debenhams in a market that remains volatile and challenging.

“We are taking tough decisions on stores where financial performance is likely to deteriorate over time.”

Mr Bucher insisted: “Debenhams remains a strong and trusted brand with 19 million customers shopping with us over the past year. With a strengthened balance sheet, we will focus investment behind our strategic priorities and ensure that Debenhams has a sustainable and profitable future.”

To compound matters, Debenhams is also the subject of takeover talk, with speculation building that billionaire Newcastle United owner Mike Ashley is set to merge it with his newly-acquired House of Fraser.

Mr Ashley owns just under 30% of Debenhams, close to the threshold at which he must launch an official takeover bid.

Woes at Debenhams come as a number of retailers on the Belfast high street continue to suffer in the wake of the catastrophic fire at the Bank Buildings, which housed Primark.

Belfast City Council’s economic development team has estimated that the city will lose between £1m and £3m per month in the short-term as a result of the fire.

Around 300 businesses have been impacted and 22 organisations within a cordon around the site have had to close as a result, including 14 retailers. Businesses outside it have seen sales levels drop by between 20% and 70%.

According to the team’s statistics, CastleCourt has experienced a drop of almost 50% in footfall in September compared to the same period last year.