Tuesday, 21 October 2008

Debenham's shows the outlook for retail


Debenham's gave a retail update this morning, its sales are down 0.9% although it says it is gaining market share (its competitors are M&S, Next and John Lewis). Its debt burden, built by the financial wizardy of Private Equity ownership, is £994 million, down nearly £200 million from last year. The current management team are up for a near £50 million windfall between them from the re-float of the company after the Private Equity ownership.

But to do this it has had to cut its dividend to 0.5 pence per share (still not too bad with the shares now at 33p, less useful if you had bought them when it floated at £2 a share).

The story here though is of a company is pure stasis. It has too much debt to invest in any new products, stores or technology and it faces a tough consumer market in a receession. Yet good management may see it through, but this won't be the driver of the UK's way out of a recession.

It is a fragile company despite its size and history and as such it reflects much of the UK retail market. The share prices of this industry are under-pressure and it looks like it will stay that way with results like this.

11 comments:

Houdini said...

I foresee Philip Green having some problems...

sammy said...

I've often thought that many of our retailers weren't particularly good - in terms of what they offer, the store experience, the customer service experience, pricing... I try to avoid Debenhams these days, which has felt like a low-rent department store for years already... Where is the UK equivalent of Nordstrom in the USA? Even Sears?
And we have Woolworths... Argos... House of Fraser stores have felt stuck in a timewarp for about 10-20 years...
There are better shops in France even - Galleries Lafayette, for example. You feel like you're in for a shopping experience and not brushing dust off the shelves which your grandparents left there.
What are the success stories? Top Shop? Primark? Where is the quality?

Anyhow - I guess what I'm saying is that if UK stores start to struggle, it's because they were only being held aloft by a high tide which helped everyone.

CityUnslicker said...

Houdini - yep same fall in sales there for mr Green.

CityUnslicker said...

Sammy - People get what they deserve. The Uk retail market is full of people wanting lots of cheap goods, less keen on the quality. It is also mainly aimed at young women/girls with disposable income to spend in the shops. So the retail experience on offer has been designed to match

Hence topshop, primark etc. I think the market has done well to follow the wishes of its customers.

Debs is very much the mid-range leader, hence your comments about low rent etc being broadly right in comparison to John Lewis etc.

sammy said...

yeah, well I agree that cheap'n'nasty shops serve *their* customers - I'm not anti-market - but there are plenty of us who are not served by the market, who are happy for an excuse not to spend money and to use internet retailers because shopping environments are horrible in this country...

I guess what provoked this is, you mentioned at end of post that Debs will have no money to spend on stores, technology etc. - my point is that they didn't do anything to attract customers even before they were leveraged to the hilt!
Even during the good times, shops in England have been shabby. Town centres are shabby in most towns places (I've done a lot of travelling around country last couple of years). This is despite a retail and spending boom.

Bill Quango MP said...

House of Fraser stores have felt stuck in a timewarp for about 10-20 years... Sammy? Bit harsh.
Flagship anchor stores in every shopping centre they are in.

CityUnslicker said...

Sammy - well, look at what ASOS is doing to the fashion market. You are quite correct.

I feel some of this is driven by our historically high rents though. more money spent on acquiring and owning property, less to spend on fit out etc.

Houdini said...

The rents issue is a good observation CU. A friend of mine owned his premises in Chester, up on the rows, and they were and had been for decades one of the most exclusive ladies outfitters in the UK. The rates killed them and they shrunk and shrunk until the disappeared.

Same for almost everywhere else. The likes of Philip Green, now whining about the banks, have stripped the real quality from stores and are part of the problem.

But that is progress where the chav in their millions with massive tax credit money, as opposed to the middle class in their thousands taxed to the hilt, make the agenda.

M&S will ultimately survive though and have shown that quality, broadly, will survive as a unique selling point.

CityUnslicker said...

Houdini - I am not so sure about M&S, they have made some big mistakes recently and their food offering has been shown to be un-recession proof!

look said...

aaaa片, 免費聊天, 咆哮小老鼠影片分享區, 金瓶梅影片, av女優王國, 78論壇, 女同聊天室, 熟女貼圖, 1069壞朋友論壇gay, 淫蕩少女總部, 日本情色派, 平水相逢, 黑澀會美眉無名, 網路小說免費看, 999東洋成人, 免費視訊聊天, 情色電影分享區, 9k躺伯虎聊天室, 傑克論壇, 日本女星杉本彩寫真, 自拍電影免費下載, a片論壇, 情色短片試看, 素人自拍寫真, 免費成人影音, 彩虹自拍, 小魔女貼影片, 自拍裸體寫真, 禿頭俱樂部, 環球av影音城, 學生色情聊天室, 視訊美女, 辣妹情色圖, 性感卡通美女圖片, 影音, 情色照片 做愛, hilive tv , 忘年之交聊天室, 制服美女, 性感辣妹, ut 女同聊天室, 淫蕩自拍, 處女貼圖貼片區, 聊天ukiss tw, 亞亞成人館, 777成人, 秋瓷炫裸體寫真, 淫蕩天使貼圖, 十八禁成人影音, 禁地論壇, 洪爺淫蕩自拍, 秘書自拍圖片,

做愛的漫畫圖片, 情色電影分享區, 做愛ㄉ影片, 丁字褲美女寫真, 色美眉, 自拍俱樂部首頁, 日本偷自拍圖片, 色情做愛影片, 情色貼圖區, 八國聯軍情色網, 免費線上a片, 淫蕩女孩自拍, 美國a片, 都都成人站, 色情自拍, 本土自拍照片, 熊貓貼圖區, 色情影片, 5278影片網, 脫星寫真圖片, 粉喵聊天室, 金瓶梅18, sex888影片分享區, 1007視訊, 雙贏論壇, 爆爆爽a片免費看, 天堂私服論壇, 情色電影下載, 成人短片, 麗的線上情色小遊戲, 情色動畫免費下載, 日本女優, 小說論壇, 777成人區, showlive影音聊天網, 聊天室尋夢園, 義大利女星寫真集, 韓國a片, 熟女人妻援交, 0204成人, 性感內衣模特兒, 影片, 情色卡通, 85cc免費影城85cc, 本土自拍照片, 成人漫畫區, 18禁, 情人節阿性,

uhfdf said...

情色電影, aio交友愛情館, 言情小說, 愛情小說, 色情A片, 情色論壇, 色情影片, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊美女, 視訊交友, ut聊天室, 視訊聊天, 免費視訊聊天室, a片下載, av片, A漫, av dvd, av成人網, 聊天室, 成人論壇, 本土自拍, 自拍, A片, 愛情公寓, 情色, 舊情人, 情色貼圖, 情色文學, 情色交友, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 色情遊戲, 情色視訊, 情色電影, aio交友愛情館, 色情a片, 一夜情, 辣妹視訊, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊, 視訊美女, 美女視訊, 視訊交友, 視訊聊天, 免費視訊聊天室, 情人視訊網, 影音視訊聊天室, 視訊交友90739, 成人影片, 成人交友,

免費A片, 本土自拍, AV女優, 美女視訊, 情色交友, 免費AV, 色情網站, 辣妹視訊, 美女交友, 色情影片, 成人影片, 成人網站, A片,H漫, 18成人, 成人圖片, 成人漫畫, 情色網, 日本A片, 免費A片下載, 性愛, 成人交友, 嘟嘟成人網, 成人電影, 成人, 成人貼圖, 成人小說, 成人文章, 成人圖片區, 免費成人影片, 成人遊戲, 微風成人, 愛情公寓, 情色, 情色貼圖, 情色文學, 做愛, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 寄情築園小遊戲, 色情遊戲, 情色視訊,