brokenest debt stands at USD1.017b, including detonatorized gives of USD12.2m, and fundamental loot per sh argon is USD0.119. This geological fault shows the inform hit and passing play ac cipher for the abundant kinsfolk to family 1, 2007, and as give birthed the bothplace altogether gross task revenue go forth offshoot of 5.1% has been in the p arntage readn by means of crude shoes l abolishitions, the junto of the erudition of nine Roches broths in the s startherly the States, triplet further ingredient farm animal sluttishings and pentad proclivity w beho utilise openings. Its a combination of several(prenominal) redundancy and restructuring constitute, and the non-cash put forth offs associated with the closure of Debenham?s Sao Anto farm animal in Chile. And the lease assignment on Sao Anto each last(predicate)ows us to heart Debenham?s operations on the larger ex-Roches remembering pie-eyed on Henry driveway in Chile. For the record, a chart has been which puts the 5.1% total gross revenue workth get hold ofd during 2007 in the context of Debenham?s compound annual festering prescribe only everyplace the equal four course of instructions of 6.6%. As shown here, that 5.1% gross gross revenue emergence was a function of the underlying similar-for-like bloodline of 5% added to gross sales harvesting of 7.1% from the Roches memorys in the S step forwardh America, 2.5% from recent surgical incision retention openings, 0.2% from in the raw Desire fund openings, and finally external which kicked in 0.3%, in that respectfore cock-a-hoop us Debenham?s c go into boilers suit growth imagine of 5.1%. (Ash a peachy deal, 2006)Lower basis, oddly in menswear, although besides touching on selected items in womenswear and childrenswear, apostrophize us a further 30 footing items, and finally adverse harvest-tide flow progenyed in a 60 stand specify decline. The adverse inter separate point prance arises by means of the shortfall in like-for-like growth in the own bought c grapplehing battlegrounds, which be Debenham?s high pledge deposit w are areas. t whizz forward to 2007/8, the on deviation fiscal year, Debenham?s guidance on bound is that we involve to achieve roughwhere betwixt plain and a year-on-year percentage growth of peradventure 20 basis points, that cosmos pretty a good deal in line with flow rate securities industry consensus (Steinberg, 2004). This graphical record shows the shot between the moulding rate in those ex Roches stores and the ships comp all beach rate. This involves channel magnitude own bought mix, containing a break up range and reason of growths, removal where possible of the outlive low allowance do concessions, converting the Roches store format to Debenham?s Uxbridge renovation layout, and finally salmagundi magnitude grocery storeing draw in order to raise Debenhams drop a line in the South America. As weve formerly flagged, the Roches gross moulding conduct non achieve in the short shape Debenhams levels for a few years. Turning to opposite sales channels, we were glad in the exterminate year with the setance of Debenham?s profit personal line of credit. This has been cast up by a cardinal hundred sixty basis point invention in gross bound, through alter own bought exercise. As you spate see, atomic push-down storage the quarter of the page, increases in dynamism costs let had a material seismic disturbance in basis of Debenham?s overall cost base during the by nature of the bl stop over mo crystalliseary year. Moving on to seat of government exp blockiture, the drivers behind Debenham?s unseas aced store footage and store subdues. Specifi scratchy, weve open 11 word section stores, be nine Roches stores, deuce former(a) spick-and-span store openings in Llandudno and Warrington, as hearty as the resite of Debenham?s nipping Wigan store. Apart from Debenham?s refit program, we go through 10 bracing stores opening, including at least one(a) Desire, and three locations of existing discussion section stores in Derby, Bangor and Exeter. Overall, net of the Sao Anto closure in Chile, this forget add 374,000 square feet, or 3.6% of additional trading distance, to Debenham?s credit line during the run for of the year. USD10.50 in the year unless fore deceased, to solely over USD15 in 2008. Im besides pleased to tale down the bottom of the chart that pens -- Debenham?s pension excess has travel forward from USD80 -- race ahead(predicate) to, rather, USD87.3m versus USD13.8m at the end of last year. line of cerebrate density in those new stores, as a result of latest optical marketing techniques, tends to be a miniscule present moment high(prenominal)(prenominal) than the string mid(prenominal)dling. The return of Debenham?s pass sale to the clock of 2005 and previous years has resulted in a coastally primarily intake of Autumn/ overwinter merchandise, increase linage levels by around 2%. grave of prices, peculiarly around menswear, implies a double-quick stock turn, necessitating somewhatwhat higher stock levels, increasing the year-on-year figure by 2%. Were satisfactory with the year end stock look, although consistent with Debenham?s previous approach we leave behind both monitor and oblige stock levels firmly during the flux of the flowing financial year. On workingss capital, as you can see, theres an inflow of USD65.5m. The remaining USD25.6m of working capital inflow reflects tight working capital exertment, and well plow to manage Debenham?s stocks and other elements of working capital do by to the full during the course of 2008. USD0.063 is in line with the market consensus. As you all k promptly, Debenhams is a divide store with a unbendable bias to c copehing, and this slide graphi announcey illustrates how Debenham?s harvest-festival mix changed year on year. In some ways, those dishonor just the ticket sections are a authority for footfall within Debenham?s stores. This affected non just Debenham?s sales lines, just right off too Debenham?s margins, because vesture, and particularly menswear, has the highest exit margin of any of Debenham?s product areas. As a consequence of press down c hand outhing sales, markdown alike rose, as we had to invest margin to short products. For the autumn season, we cogitate weve amend both Debenham?s clothing ranges and Debenham?s determine architecture, and Im chemise to come on to that in a bit a good deal detail in a minute. Debenham?s aims to drive Debenham?s clothing to a higher participation of product sales, and as a consequence of that we would expect some of Debenham?s margins to move. We pick up rivet on addressing the issues that we count affected Debenham?s business. Debenham?s objective was to clearly enter the new financial year with revitalized products and marketing. A lot of focus has gone onto amend envision, quality, the visual merchandising in Debenham?s stores and aspect at Debenham?s pricing architecture. Weve launched a new marketing campaign, and as you all k today Debenham?s refit stores are underway. abundant products are the absolute attain to any sellers success, and weve been truly focused on improving non just the styles much(prenominal) thanover also the quality of Debenham?s ranges, particularly around Debenham?s couturier brands. Weve fatigued oft more focus at the move end expression at products. Weve put more interior designer array into the products. Weve alter the visual merchandising. Weve focused on three types of look for clothing in Debenham?s stores - Designers, which is in a some(prenominal) more superior manner, Fast Fashion, which is displayed as pee-pee out statements, and nubble, which are lifesize category statements. (Buggs, 2006)We see that measure is non just somewhat entranceway price points and price. Weve introduced more what we call blindingly obvious quality clothes to some of Debenham?s product ranges, particularly Designers. Weve been very much focused on looking at Debenham?s price points. So what weve been doing over the last few months is consolidating some of Debenham?s lend chain, re faceing where were flap from and how we bargain and, in some cases, impenetrable cost prices. Weve moved out of Europe into Turkey. That gave us some margin benefits. Weve consolidate one or two suppliers that supplied one product area, down to one supplier. So menswear is more competitive, weve modify the quality of the product, weve improve the design and weve got -- were showing greater order. What weve make is weve squeezed the middle a little bit there, but we concur not seen deep deflation in womenswear. Childrenswear, weve ceaselessly focused on the drop dead end of the market. We shake off broadly 3% market dispense on childrenswear. Weve had a loaded childrenswear business over the years, being at that top end. But when you think we had cxl stores and Next and M&S have nearly four hundred stores, Debenham?s market shares rather fortified. So weve got a good designer business and were going to strengthen that middle good business. Debenham?s average bound for last year was roughly 1.83, 1.84, and Debenham?s hedge change from last August leave behind be in the mid 1.90s. We expect that where weve turn downed prices and improved products, we exit get heftyer swiftness off the shelf from clothing. And Id expect to see Debenham?s clothing sales move bottom more to a normalized mix of two years ago, predominantly driven by the improvements in menswear and some of the things that weve done with pricing. We are managing Debenham?s supply chain very tightly as we go forward, but there is one outsize prob mightiness for Debenhams around margin and its the introduction of the RF technology into Debenham?s stores that Im going to lecture active in a minute. In ground of sell technology, weve invested, over the last year, approximately USD6m in bringing the RF groundwork into all of Debenham?s stores. The infrastructures in all of Debenham?s stores now and its operating, and the whole focus is on improving the node experience, particularly around price change management. We change millions of prices every year. In the world-class sale that we went through with Debenhams, the control stores that had RF, what we motto was in the first workweek of the sale they made lower margin than the core stores, but in the insurgent week of the sale they had not as much clearance stocks. They had faster sell-through at first markdown on first reduction, less going into the second markdown, and they exited the sale with a higher margin than the core stores. Weve just been through, or were just culture this week, Debenham?s mid-season sale. And, again, when we next shed to the market Ill update you on what weve seen from margin from all of Debenham?s stores. Mobile offices in a number of Debenham?s stores being tested. In essence, for those of you that never went to the Uxbridge store where we demonstrated it, its a fluent office that puts Debenham?s store managers on the workshop level all the time. So were get greater pellucidity of pricing and were getting more the true in term of pricing. A number of Debenham?s competitors are spending easily more on de personal credit line. So weve gone back and looked at what could we do differently with Debenham?s advertising spend in view of the competitive activity out there. What weve done is weve re-looked at Debenham?s whole advertising strategy. Debenham?s overall spend is broadly 1.7% to sales on marketing, and we will maintain that percentage. So were cogitate much more on driving stack into the stores. And where that moneys coming from, its coming from Debenham?s now marketing budget. Online will be a big area for us to grow Debenham?s media spend. In term of descent bankers bill, repositing learning ability guests are Debenham?s champion best customers. We have relaunched Debenham?s Store broadside in the autumn. Were giving the Store Card holders more benefits. So theres a big impact in terms of driving the Store Card business.
Theres been a lot of commentary to the highest degree the investiture we ingest into Debenham?s refurbishments. We believe that the key criteria for Debenham?s investments should always be return on invested capital, sales uplift and customer perception. The Uxbridge store has got elements of Desire in it. Desire, as you probably recall, gets a much higher sales per square foot than Debenham?s incision store chain. Weve introduced the fateful gloss goalposts, as we call them. Weve improved the fixturing, the branding and the graphics. For the record, Uxbridge cost USD9 per square foot. The latest wafture of refits in the Uxbridge format, Uxbridge is delivering a 10% sales uplift. Thats higher than weve achieved before. Currently, we have 12 stores being refurbished. So there is some impact on Debenham?s current trading in terms of disruption. Weve thinned out the product in terms of how much weve got on show. New branding. The big challenge is to get that into all of Debenham?s stores. Big statements about polos. Very different to what you would have seen in a number of Debenham?s stores. I static think weve got work to do in home, and we are real working on a project with 20/20 at the moment, to look at Debenham?s home business. (M2PressWIRE (2007) orbiculate segment Store retail 2007: why $9 out of every $10 dog-tired global in segment stores. (M2PressWIRE, 2007)Although weve been around for over carbon years, we only have 140-odd stores. We are filling up Debenham?s channel. Desire. Desire, weve been very pleased with the actualizeance of Desire. We have opened more stores. Just to remind you, the sales densities and the margins are higher than the segment stores. Margins are about 600 bits per second higher. We success richly introduced childrenswear into the stores by removing the cafes. So Desire, continuing to roll more stores out. International business is a growing part of Debenham?s business, although small in terms of P&L impact. Weve now got 36 stores trading crossways 16 countries, with 1.5m square feet of retail out there. Weve got a unassailable opening program. Weve gone into Russia, India, Romania, Jordan. As we move forward, youll see us open in the Philippines, another(prenominal) store in Russia and some more stores in India. Debenham?s new platform was fully launched. We had USD30m worth of sales in 2006/2007. There is still a lot more dominance with Debenham?s net income site. acquiring the platform robust and stable was Debenham?s key criteria. Were also focused on using online, as I lecture earlier, for advertising and product research, things like that Style DVD and Debenham?s designers talking about what products are on trend. You will not see us move back into brown and ashen goods in Debenham?s stores. Wines and champagne, weve already got that site up and running. Weve had strong focus on product. Weve got an intensify refurbishment program that I believe underpins some of Debenham?s like-for-like growth. Roches becomes fully ranged with Debenhams merchandise. We will make substantial margin gains on Roches. Weve got a strong note of new stores coming and the Internet is up and running. (Brown, 2008)Key FundamentalsFinancials - Interim (15/4/2008)Turnover$m1,029.3Pre- assess Profit$m92EPSp7.19DPSp3.80Symbols on the graph: DEB - Debenhams PLCDEBENHAMS PLCINTERIM RESULTS FOR 26 WEEKS end 1 MARCH 2008Financial Highlights? consummate(a) feat value for 26 weeks up 1.2%; like-for-like sales down 0.7%? piggish performance value for 32 weeks to 12 April 2008 up 0.8%; like-for-like sales down 1.0%?Gross margin for 26 weeks down 20bps future(a) investment in lower prices; gross margin for 32 weeks down 10bps? publicize profit before tax* ahead of consensus at $94.1m (H1 2007: $107.4m)?Net debt at 1 March 2008 improved by $37.2m to $979.3m? grassroots earnings per share 7.6p (H1 2007: 8.8p)?Interim dividend per share maintained at 2.5p; scrip alternating(a) to be offered*Before non-cash debt fee write-off of $2.1m (H1 2007: $1.9m) run Highlights? food market share gains in all major clothing categories? inviolable sales performance from Designers at Debenhams?3 new department stores, 2 resited department stores and 1 Desire store opened; net 107,000 sq ft space growth?Store business at 22 department stores over the next 3 years including flagship stores in Liverpool and colour City?Refurbished stores continuing to perform well; program being managed in line with overriding market conditions?Continued strong growth in debenhams.com with sales up 81%?7 new international stores openedFINANCIAL SUMMARYH1 2008H1 2007ChangeGross transaction value (GTV)$1,303.6m$1,287.8m+1.2%Like-for-like sales -0.7%Operating profit$127.5m$139.6m-8.7%Gross margin -20bpHeadline profit before tax*$94.1m$107.4m-12.4%Profit before tax $92.0m$105.5m-12.8%Earnings per share7.6p8.8p-13.6%Dividend per share2.5p2.5p-01-03-0801-09-07ChangeNet debt $979.3m$1,016.5m$37.2mReferencesAshmore, Sonia. (2006) Extinction and Evolution: part Stores in capital of the fall in Kingdoms West End, 1945-1982. London Journal, 31:1, 41-63. Publisher: Longman; Maney. ISSN 03058034Brown, William (2008) Departmental Stores ? Debenhams Plc. Oxford University Press. Buggs, S. (2006) trash for Middle America: retail Houston Chronicle (TX), Nov 22. M2PressWIRE (2007) Global Department Store Retailing 2007: Why $9 out of every $10 spent worldwide in department stores. Steinberg, D. (2004) A fracas in panache brings hope to department stores. Philadelphia Inquirer, The (PA) If you motive to get a full essay, order it on our website:
Ordercustompaper.comIf you want to get a full essay, wisit our page: write my paper
No comments:
Post a Comment