Quiz keeping Debenhams in sights as sales show progress

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Glasgow-headquartered fashion retailer Quiz said it would continue to “work productively” with Debenhams in the wake of the department store chain’s collapse into administration earlier this week.

Quiz operates 108 Debenhams concessions in the UK and 11 in the Republic of Ireland and also sells its products through the Debenhams website. Sales from these activities represented almost a quarter of overall revenues generated by Quiz in the past year.

Issuing a trading update highlighting its latest sales performance, the group said: “We look forward to continuing to work productively with Debenhams going forward.”

Debenhams was placed into administration this week with lenders seizing control of the embattled high street giant, sparking fears of store closures and job losses.

Administrators at FTI Consulting were appointed to the chain and immediately sold the group’s operating companies to a new entity owned by its lenders.

Debenhams has 166 stores, including 16 in Scotland in towns and cities including Edinbrugh, Aberdeen, Dundee, Dunfermline and Glasgow. They will initially continue to trade, although about 50 branches had already been earmarked for closure in the future. The move wiped out the stake held by Sports Direct tycoon Mike Ashley in Debenhams, and those of all other shareholders.

In its update Quiz said group revenue had increased 12 per cent to £130.9 million during the year to 31 March.

Revenues from online surged 34 per cent to £41m, while UK stores and concessions generated revenues of £66.9m, a year-on-year increase of 4 per cent. International sales growth was 8 per cent.

The firm said revenue generated from its own websites jumped 58 per cent during the year, “reflecting the impact of the increased marketing spend undertaken”.

The board continues to anticipate that underlying earnings will amount to some £4.5m for the year.

Last month, Quiz issued its second profit warning this year, almost halving its fullyear earnings expectations. The £4.5m figure flagged was down from the £8.2m forecast by the group in January, when it last warned on sales and profits after disappointing Christmas trading, reducing full-year expectations from the £11.5m estimate made in October.

In its latest trading statement, Quiz told investors: “The board previously noted that it is undertaking a thorough review of all aspects of the business with a view to mitigating the effects of slower-than-anticipated growth during the year.

“We will report the findings from this review when we announce our final results for financial year 2019 on 11 June.”