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Are Guildford and Woking Debenhams at risk of closure?

3 minute read
Are Guildford and Woking Debenhams at risk of closure?

Published at 7:22am 25th October 2018. (Updated at 9:31am 25th October 2018)

Debenhams is to close up to 50 stores, putting thousands of jobs at risk.

It comes after the department store chain booked a mammoth annual loss of £492 million for the 12 months to 1 September.

The cuts are part of moves to clear the decks for a turnaround.

It is not yet known if the Guildford and Woking stores are at risk - or the Walton-on-Thames branch.

In January this year the Farnborough branch closed down as part of a national move to cut back on the chain's high street outlets.

It said the bulk of the loss - the biggest in its 240-year history - was the result of non-cash writedowns totalling £512.4m on things such as store and lease provisions and the cost of IT systems.

They offset underlying profits of just over £33m - as Sky's City editor Mark Kleinman had revealed on Wednesday night.

Debenhams said it was taking "decisive action" to secure its future through an accelerated programme of cost savings to allow for continued investment to boost the appeal of its stores.

The headline measure was a plan to extend its previously announced store closure programme from 10 to a possible 50 sites over the next three to five years.

It means almost a third of its current UK estate will go.

Debenhams said it would also reduce investment in a further 20 stores.

Sources told Sky News the proposals place up to 5,000 jobs at risk among its workforce of 27,000 people.

Chief executive Sergio Bucher said:

"It has been a tough year for retail in 2018 and our performance reflects that.

"We are taking decisive steps to strengthen Debenhams in a market that remains volatile and challenging.

"We are taking tough decisions on stores where financial performance is likely to deteriorate over time.

"Debenhams remains a strong and trusted brand with 19 million customers shopping with us over the past year.

"With a strengthened balance sheet, we will focus investment behind our strategic priorities and ensure that Debenhams has a sustainable and profitable future."

The company's actions are designed to create a sustainable future for the brand after the demise and rescue of House of Fraser bought, incidentally, by Debenhams' biggest shareholder - Mike Ashley's Sports Direct.

The high street, according to the retail sector, is suffering the perfect storm of extra costs from business rates and wage rules while also battling weaker pre-Brexit spending by consumers.

Debenhams' decision also reflected the changing habits of consumers through the growth of online shopping channels and the effects of strong competition which has put additional pressure on margins.

Debenhams Guildford

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