Debenhams Dials Back on Clothing Sales to Defy U.K. Retail Gloomby
Surprise revenue growth driven by sales in homeware, beauty
Shares surge as much as 18% in biggest jump since 2009
For some U.K. retailers, selling clothing is going out of fashion.
Department-store chain Debenhams Plc reported an unexpected rise in Christmas-period revenue, besting results from rivals Marks & Spencer Group Plc and Next Plc and sending its shares up by as much as 18 percent. Departing Chief Executive Officer Michael Sharp attributed the result to a reduced dependency on clothing sales, which have been hurt by Britons’ growing tendency to spend their disposable income on their homes.
The London-based retailer’s “very strong” quarter demonstrates the breadth of its product offer, James Collins, an analyst at Stifel, said in a note. About 55 percent of the company’s sales came outside of fashion, in categories such as homewares and beauty, up from about 52 percent a year ago, he said.