House of Fraser and Debenhams latest retailers to face struggles

24 April 2018 - Janet Bird

house of fraser

House of Fraser and Debenhams are the latest major high street names to find themselves struggling in a year that has already seen a number of high profile retailers collapse.

House of Fraser has called in auditors KPMG to advise on a restructuring strategy in a bid to restore its ailing fortunes.

Meanwhile, Debenhams has announced a pre-tax plunge in profits of 84 percent in the half year to March 3 after a disappointing Christmas season and a further hit to sales when the so-called 'Beast from the East' forced 100 stores to close temporarily in March due to adverse weather.

Despite the huge drop in profits, Debenham's Chief Executive Sergio Bucher said he was hugely encouraged by progress in efforts to transform the department store.

Both House of Fraser and Debenhams have been struggling for some time to cope with challenging market conditions.

House of Fraser is reportedly considering a company voluntary agreement (CVA), an agreement with creditors which allows companies to offload their underperforming stores and reduce rents in a bid to avoid entering administration.

Credit insurers cut ties with the retailer in February, refusing to insure its suppliers amid concerns it could collapse.

If it does enter into a CVA, some of the retailer's 6,000 employees and 11,500 concessions staff would be likely to lose their jobs.

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