High Street Retailer Debenhams Has Announced It Is Closing 50 Stores
Debenhams has announced plans to close 50 stores, putting 4,000 jobs at risk, due to a massive drop in profits.
The high-street department store has said the closures will be spread over a three to five year period, but have not released a list of the stores set to close yet.
As it stands, Debenhams has 166 branches across the UK, with the business previously confirming plans to close 10 stores, but now it's added 40 more to the list.
In the year to 1st September, the department store group lost £491.5m, compared to profits of £59m the year before in 2017.
Boss Sergio Bucher said the company was 'taking tough decisions' on stores which were currently contributing positively to the business but where financial performance was likely to deteriorate over time.
Mr 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."
The Debenhams boss said the company will be looking to take £130 million of costs out of the business, including suspending the dividend (payments made to shareholders) so they can put more profit back in.
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However, he still insisted that Debenhams is a strong brand, saying: "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."
The news comes after rumours suggested Claire's Accessories was planning to close a number of stores.
It was reported that the company was working with a restructuring firm which reportedly would have seen the retailer entering a Company Voluntary Arrangement (CVA) to shed sites and gain rent reductions.
However, CEO Ron Marshall spoke about the rumours and explained that they have no intentions for a CVA.
He explained that the company was in a 'better situation than ever' and that any store closures or openings would be part of their everyday business and not due to financial problems.
Featured Image Credit: PA
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