Debenhams’ profits tumble

Debenhams is poised to report a halving of its profits next week after the retailer performed poorly over Christmas and was forced to close stores in March due to extreme weather.

The department store is expected to post halfyear pre-tax profits of just £44million on Thursday, down from £87.8million the year before, according to City analysts.

Consensus estimates also forecast a 2.5% decline in like-for-like sales over the six-month period.

Debenhams issued a profit warning in early January after a disappointing Christmas period, prompting its share price to plunge by 20%.

The retailer has closed two stores since October in a bid to reduce costs associated with rent and business rates, and the company has identified a further 10 across the country that could be shut down in due course.

However, the retailer is tied into long-term leases in many of its stores, meaning it must shed staff to save on costs. In February, 320 staff were made redundant in a shake-up of middlemanagement.

Debenhams is suffering