Jump to content
DOSBODS
  • Welcome to DOSBODS

     

    DOSBODS is free of any advertising.

    Ads are annoying, and - increasingly - advertising companies limit free speech online. DOSBODS Forums are completely free to use. Please create a free account to be able to access all the features of the DOSBODS community. It only takes 20 seconds!

     

IGNORED

Debenhams:Death spiral?


sancho panza

Recommended Posts

sancho panza

Decl:no position

June 25th

http://www.proactiveinvestors.co.uk/companies/news/199482/rbc-cuts-target-for-debenhams-following-third-profit-warning-199482.html

'Canadian bank RBC has cut its target price for department store chain Debenhams PLC (LON:DEB) to 19p from 25p following the company’s third profit warning in six months.

Analysts slashed their pre-tax profit (PBT) forecasts for the firm by 25%-30%, saying they didn’t expect much improvement in sales for the remainder of the current financial year.

 

Debenhams was facing easier comparisons as from May but we think it has continued to suffer from having a sub-optimal clothing and home offer and from being overly reliant on promotional activity to drive footfall and online spend” the bank said.

They added: “Debenhams has stated that it would only breach its fixed charge covenant if PBT falls below £20mn, but on c.£3bn of Gross Transaction Value (GTV) we estimate “this means Debs is only one poor Christmas away from a breach.”

Despite the bleak outlook, the bank also highlighted several options for the company to strengthen its balance sheet, including its plan to cut capital expenditure for the 2019 financial year to £75mln-£90mln from £140mln in 2018 in addition to a strategic review of its non-core assets, a small printing business in south-west England and Danish department store chain Magasin.

RBC said Magasin was Debenhams' most profitable business and has a growing multi-channel capability which could be of interest to buyers in a potential sale that could be a “potential positive catalyst for the shares”.

Debenhams issued its third profit warning on 19 June, pointing to “exceptionally difficult times in UK retail”.

The retailer, which first warned on profits in January and again in April, said trading in May and early June fell short of expectations due to increased competitor discounting and weakness in key markets.

In mid-morning trading Monday, Debenhams shares were down 1% at 17p.'

https://www.investing.com/equities/debenhams-balance-sheet

Worht noting Assets/Liabilities:£2.2bn vs £1.32bn but that assets includes £990mn of 'intangibles' and £640 mn of property and plant ie stores I presume.

 

 

image.png.47a2b0890282c0adb3a81701ec6ccfe1.png

Link to comment
Share on other sites

  • Replies 168
  • Created
  • Last Reply

When I was in Copenhagen last year - Magasin was a nice store (I visited 2 there), full of nice products and clothes with staff interested in helping you. @SNACR would either love it or hate it...

In fact it's absolutely everything Debenham's isn't

Link to comment
Share on other sites

Debenhams seems to have been in a death spiral for years. I've two stores relatively close to me, Guildford and Crawley. Guildford, clearly they have invested money, Crawley looks like a TK Max - maybe they will get rid of some of the stores rather than go completely bust - I prefer Debenhams to M & S so would be miffed if they completely disappeared.

Link to comment
Share on other sites

10 hours ago, Dipsy said:

Debenhams seems to have been in a death spiral for years. I've two stores relatively close to me, Guildford and Crawley. Guildford, clearly they have invested money, Crawley looks like a TK Max - maybe they will get rid of some of the stores rather than go completely bust - I prefer Debenhams to M & S so would be miffed if they completely disappeared.

Well, since it was refloated by the PE company, all the assets stripped out and replaced with debt

Link to comment
Share on other sites

  • 3 months later...

Closing 50 stores

I was in my local one last weekend looking for a pair of jeans in the menswear dept. I take it that a 34 inch waist is quite popular as all I could find is one in the style I liked that was too long in the leg (I need a regular leg size)

I went to their 'Red Herring' section. Bough a fair quantity of the clothes in the past 20 years. Looked under the sign for 'Boot cut' jeans but there were only slim or skinny fit jeans so that doesn't tie in well. They were stacked inside a box like shelf on the wall so sorting through 'em was a pain.

Left empty handed.

Before Debenhams I went to Peacocks but their jeans tended to be for millenials or Gen Z with matchstick legs. I never knew that 'ultra skinny' jeans were a thing now. O.o

Looks like online retailers it is, then. 9_9

Link to comment
Share on other sites

Bedrag Justesen

BBC News At One 25/10/2018

Maureen Hinton, Retail Expert, Global Data.

" The landlords are negotiating with all retailers at the moment, it appears. 

...and so they are not going to let them go away. They'll have costly leases to get out of, and on top of that, they'll have less money to invest in their stores in the future.

... and that's one of the key things they need to do to survive. "

Wakey, wakey, it's over.

Debenhams won't survive.

Landlords will have empty properties.

Nobody will rent them.

Everything will be devalued, Councils will lose income, a drop in shoppers will have a knock on effect, other shops will shut, everything will be devalued, Councils will lose income, a drop in shoppers will have a knock on effect, other shops will shut. Everything will be devalued....

The High Street is finished.

Link to comment
Share on other sites

Well they can just divide up the old buildings and turn them into flats. The landlord has no other choice if Debenhams closes one of it's stores in their building. I can't see any other retailer going in there. When Woolworths went, Poundland and 99p Stores stepped into many of the vacant spaces. With Dedenhams it's not so clear.

Takers:

Lidls/Aldi - no

Poundland - no

John Lewis - maybe, unlikely.

B&M Bargains - no they like out of town outlets

Wilko - no

Link to comment
Share on other sites

17 hours ago, 201p said:

Well they can just divide up the old buildings and turn them into flats. The landlord has no other choice if Debenhams closes one of it's stores in their building. 

My local Debenhams in Norwich would turn into flats fairly easily. The upper floors have smaller windows. What to do with the ground floor retail space is less obvious. :/ Maybe have that as car parking and the basement as storage sheds. 

A lot of former offices have been turned into bijou living cells so why not shops and stores? 

Link to comment
Share on other sites

On 25/10/2018 at 21:29, 201p said:

Well they can just divide up the old buildings and turn them into flats. The landlord has no other choice if Debenhams closes one of it's stores in their building. I can't see any other retailer going in there. When Woolworths went, Poundland and 99p Stores stepped into many of the vacant spaces. With Dedenhams it's not so clear.

Takers:

Lidls/Aldi - no

Poundland - no

John Lewis - maybe, unlikely.

B&M Bargains - no they like out of town outlets

Wilko - no

The only taker would be John Lewis.The Debs footprint is massive.As was HoF......

Given JL's recent trading update,I don't think they'll be expanding square footage.

Their size might appeal to M&S but they're shutting rather than expanding.

Like you,I can't think of anyone that will fill that footprint.

 

6 hours ago, UmBongo said:

My local Debenhams in Norwich would turn into flats fairly easily. The upper floors have smaller windows. What to do with the ground floor retail space is less obvious. :/ Maybe have that as car parking and the basement as storage sheds. 

A lot of former offices have been turned into bijou living cells so why not shops and stores? 

The LL's could always farm Housing benefit recipients until the fiscal deficit comes home to roost.

Link to comment
Share on other sites

On 26/10/2018 at 13:54, UmBongo said:

A lot of former offices have been turned into bijou living cells 

They've had a real go at doing that with the Bracknell office space glut. I think I can fairly safely say it hasn't worked though. I lived in one for a while but lucky I moved out as it is now boarded up a hell of an eyesore. I used to walk to the pub and go past planning application notices for residential conversion posted outside a few more offices, but a couple of years later they still seem to be empty and unconverted. I don't know the economics of doing the conversion but it is obviously not so easy. Could be because Bracknell already has quite a few proper apartment blocks which look empty.

Link to comment
Share on other sites

4 hours ago, Funn3r said:

They've had a real go at doing that with the Bracknell office space glut. I think I can fairly safely say it hasn't worked though. I lived in one for a while but lucky I moved out as it is now boarded up a hell of an eyesore. I used to walk to the pub and go past planning application notices for residential conversion posted outside a few more offices, but a couple of years later they still seem to be empty and unconverted. I don't know the economics of doing the conversion but it is obviously not so easy. Could be because Bracknell already has quite a few proper apartment blocks which look empty.

I habe an ongoing argument on ToS about the mass dissappearance of jobs fron the m4 corrridor.

In my time in mucknell 20 years ago, the battle of employment v benefits suckers was already being won by single mums.

I heard theyd knocked down converted the 3m buildingwhich is far as mucknell gets to architecture notable features.

Ive managed to avoid going into bracknell for 15 years, when tge last person i knew jacked it in to move to the west country - she was knocked up anf no way on earth was she bringing her kid up there. She was from ascot.

 

The answer on tge stalled resi conversions is LHA.

Tower blicks re expensive to convert.

Only worth doing if rih owners are buying i.e london.

Makes no sense in mucknell or bstoke - just bennie housing.

Link to comment
Share on other sites

  • 3 months later...

I went in there last year for a black tie. It was £12 I think.

I reckon a few quid went to the Sultan of Brunei in ground rent. I paid £1 to rent a car space and at the till I was asked if I wanted to rent some money via a store card. 

Rentier scum. Good riddance.

 

 

Link to comment
Share on other sites

Quote

The retailer will announce it has secured a lifeline from lenders, while a debt for equity swap remains under consideration, sources told the Sunday Telegraph.

The revelation comes amid reports the department store is planning to launch a company voluntary arrangement (CVA) with administrators KPMG.

The CVA, which has been used by other major retailers including Homebase and New Look, would enable the company to close stores and negotiate rent reductions.

The proposed arrangement could be brought in before the firm’s next rent payment in March and will lead to up to 20 store closures this year, according to the Sunday Times.

Shares in Debenhams have slumped in recent months as declining sales and hefty rent bills eat away at profits. The retailer has earmarked as many as 90 of its high street stores for closure, putting 10,000 jobs at risk.

Sports Direct billionaire Mike Ashley, who holds a 30 per cent stake in Debenhams, has also been making waves at the company as he eyes a possible takeover.

Seems that either Ashley buys it, or it goes titties up by summer. I can't see Debenhams being around at Xmas 2019 sadly. Their website on the other hand seems to be reasonably popular still, don't know about the set-up there or if it's run by someone else / where orders are fulfilled etc.

Link to comment
Share on other sites

16 hours ago, spunko said:

Seems that either Ashley buys it, or it goes titties up by summer. I can't see Debenhams being around at Xmas 2019 sadly. Their website on the other hand seems to be reasonably popular still, don't know about the set-up there or if it's run by someone else / where orders are fulfilled etc.

Asley does bu stuff.

He takes over the leases on a short, rolling leases. Takes the stcok at a discount. Then shoves the building from of his shit and sees what money they make.

 

Link to comment
Share on other sites

sleepwello'nights
On ‎25‎/‎10‎/‎2018 at 14:50, Bedrag Justesen said:

 

Debenhams won't survive.

Landlords will have empty properties.

Nobody will rent them.

Everything will be devalued, Councils will lose income, a drop in shoppers will have a knock on effect, other shops will shut, everything will be devalued, Councils will lose income, a drop in shoppers will have a knock on effect, other shops will shut. Everything will be devalued....

The High Street is finished.

My guess is that local councils will increase the rates on out of town shopping centres. To recoup the extra cost the landlords will introduce car parking charges. Then as shoppers are driven online then taxes for online retail will increase. 

The shopper won't get the benefit of any savings!

Link to comment
Share on other sites

Bedrag Justesen
44 minutes ago, sleepwello'nights said:

Then as shoppers are driven online then taxes for online retail will increase. 

Our local council meetings are streamed online.

A local sales tax on Amazon purchases, and other online transactions has been suggested.

It was asked how they could collect it. 

Apparently it should be levied nationally but distributed locally. A straight replacement for Business Rates.

One councillor agreed it could work. He had been on holiday to Florida and seen something similar there.

The majority were more in favour of replacing lost income by raising Council Tax.

I believe annual Council Tax could rise to £10k and few of them would see anything wrong.

Cardiff University are studying Council Tax at the moment. At least someone realises it can't be increased every year.

It's already far too high.

Link to comment
Share on other sites

5 minutes ago, sancho panza said:

It's more banks rolling loans than a fresh injection of cash from what I can see.Kicking the can etc

The big date is 25th March.  If they don't go bust then, then they've got until June.

Link to comment
Share on other sites

Clueless BBC

https://www.bbc.co.uk/news/business-47205668

Debenhams has secured a cash injection of £40m to buy it extra time as it battles to secure a longer term deal with lenders.

The struggling department store chain called it a "first step" towards a sustainable future.

https://www.ft.com/content/5df4ea06-2e94-11e9-8744-e7016697f225

Its a 40m credit line - thats debt, not cash.

 

 

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.

  • Recently Browsing   0 members

    • No registered users viewing this page.

×
×
  • Create New...