Debenhams falls on search for ‘options’
Chairman Ian Cheshire this morning described suggestions the board was actively driving a company voluntary arrangement (CVA) with KPMG “is simply not true.”
However, analysts are concerned at the outcome of the talks. The company has made three profit warnings so far this year.
AJ Bell investment director Russ Mould said: “The market is clearly taking seriously widespread reports that department store Debenhams has called in administrators KMPG to consider its options.
“The company has already warned on profit three times in 2018 and announced plans for a series of job cuts.
“The struggles at Debenhams follow the collapse of rival House of Fraser into administration over the summer and another thing both have in common is a material presence on the shareholder register for Mike Ashley’s Sports Direct.
“Speculation that he might launch a bid for Debenhams after capturing House of Fraser in August is likely to follow.”
JD Sports reported a 3% rise in like-for-like sales in the UK, in the six months to 4 August. Pre-tax profits jumped 19% to almost £122m.
JD Sports is confident that it can deliver annual profits that will meet market expectations.
Earlier this month, rival Footasylum warned that the second half of the year would be challenging. Its shares more than halved in value.
On Monday Primark showed it was not all doom and gloom on the High Street. It is expected to raise like-for-like sales in the UK by 1.5% for its financial year, which ends on 15 September.
The retail chain owned by Associated British Foods (ABF), which earns two-thirds of its profits outside the UK. It said that due to currency moves it expects extra costs of £20m.
However, ABF said its full year trading outlook remains unchanged.
Aston Martin Lagonda yesterday confirmed its plans to float on the London Stock Exchange and has named former Royal Bank of Scotland director Penny Hughes as its chairman. She will also chair the car maker’s nomination committee.
The new new non-executive directors include former InterContinental Hotels Group chief executive Richard Solomons and former William Hill and Mothercare board member Imelda Walsh.
It says it will more than double production in the medium term from 6,200 cars a year to 14,000.
The pound rose more than 0.77% against the dollar after the EU’s chief negotiator said a Brexit deal was possible within eight weeks “if we are realistic”.
Japan’s economy grew faster than thought between April and June. Revised data showed the economy grew an annualised 3%, well above an eariier reading of 1.9% and the fastest expansion since the first quarter of 2016.