Debenhams mulls PLT sale as pre-tax losses widen

Debenhams revealed it is planning to offload PrettyLittleThing (PLT) after reporting pre-tax losses of £264m for the year to 28 February 2025, up from £164m a year earlier.

The group attributed the loss to a one-off exceptional item linked to strategic decisions, including the closure of its US distribution centre and stock write-offs of £26m.

Gross merchandise value (GMV) before returns also fell 10% year on year to £2.32bn, while revenue declined 17% to £1.21bn from £1.46bn, reflecting the “greater weight of the marketplace model”, where commission income rather than total transaction value is recognised.

However, the Debenhams arm, which includes Dorothy Perkins, Oasis and Warehouse, reported a 34% rise in sales to £654m. In contrast, Karen Millen sales slipped 3% to £157.1m.

Additionally, its adjusted EBITDA was also down 33% to £39.6m from £58.7m in 2024.

As a result, Debenhams Group has embarked on a focused, multi-year Turnaround Strategy designed to restore profitability and unlock value for all shareholders.

Alongside the potential sale of PLT, the group also plans to explore a range of long-term options for its distribution sites in the US and Burnley, to drive further efficiency and ensure our assets align with our stock-lite strategy.

Looking ahead, during H1 FY26, the group continues to see “strong” and “profitable” growth in its Debenhams brand.

All its brands are now trading profitably in terms of Adjusted EBITDA. It is also focused on right-sizing its Youth Brands.

Additionally, Debenhams expects 1H FY26 Adjusted EBITDA for continuing operations to be ahead of 1H FY25.
Dan Finley, group chief executive officer, said: “The business has been through a very challenging period which is reflected in these results. I want to assure shareholders that the business is taking the necessary actions, quickly and decisively, to address the challenges that we face. No stone will be left unturned.

“As outlined in March, we have a clear plan as Debenhams Group to transform the business and a route map to generate sustainable profit growth. Our mission is to become the shopping destination of choice by connecting our community with the brands they love. We are focused on delivering on the huge opportunity ahead for the Debenhams brand. Work is progressing to reposition and right size the Youth Brands, with a laser focus on profitability and cash generation under new management.”

He added: “This will be a multi-year turnaround as was the case with the Debenhams brand. As part of our ongoing business review, we are exploring a potential sale of PLT. We are also assessing long-term options for our US and Burnley distribution sites to enhance efficiency and ensure alignment with our stock-lite strategy.”