Debenhams’ alarming rent bill

Long-term leases to hinder uncertain turnaround of struggling department store

Future aggregate minimum payments under ‘non-cancellable’ operating leases amount to more than £4.5bn at Debenhams (DEB), according to the ailing department store operator’s 2017 annual report and accounts. The fact the hard-pressed British brand is locked into very long-term leases will hinder CEO Sergio Bucher’s attempts to turn round Debenhams. Disappointing Christmas sales and a return to heavy discounts lay behind a severe profit warning (4 Jan), which has prompted brokerage Liberum Capital to downgrade its full year pre-tax profit estimate by 35% to £52.1m.

‹ Previous2018-01-11Next ›

Important information:

These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell Youinvest.

Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.

Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.

The Shares team
Disclaimer

The value of your investments can go down as well as up and you may get back less than you originally invested. We don't offer advice, so it's important you understand the risks, if you're unsure please consult a suitably qualified financial adviser. Tax treatment depends on your individual circumstances and rules may change. Past performance is not a guide to future performance and some investments need to be held for the long term.