Debenhams Share Discussion Threads

[this_time_its_different] 18/1/2019 09:09

You know the management don't believe in the company when they asked to be paid in cash. Debs is finished now. There is nothing left to salvage.

[diku] 18/1/2019 08:42

Ask Q!... he got plenty of research on research...

[only who?] 18/1/2019 08:32

2p, or not 2p?

[debsdowner] 18/1/2019 07:51

FT

Says reports on talks with Landlords but I envisage a further obstacle. The company needs 75% approval for a CVA but some of the stores are profitable so any profitable store owners will be reluctant to reduce rents.

UK landlords to be hit with rent cuts from Debenhams stores

British Land and Intu have largest exposure to struggling retailer

"Some of the UK’s biggest listed landlords face rent cuts as Debenhams seek to reduce the burden of a store portfolio that includes leases stretching as far as 2083.British Land and Intu have the largest exposure to the struggling retailer, according to data from Colliers International, although people close to both companies insisted their stores were among Debenhams’ most successful.Other groups with significant exposure include Landsec, Capital & Regional and Hammerson, the data shows.

At least 30 of Debenhams’ 165 stores are owned by listed groups.The department store chain is holding talks with landlords as it attempts to negotiate changes to its portfolio, including at least 50 store closures. But it has not ruled out a company voluntary arrangement, an insolvency deal that would involve rent cuts at some stores and potential further closures.Debenhams declined to comment but a person familiar with its plans said “conversations are taking place with all landlords, and while many of the weakest stores are owned by private landlords, the company is looking for the support of all landlords to address the burden of its onerous leases”.While listed groups generally own Debenhams’ stronger locations — such as its newest store in Intu’s Watford shopping centre — they also hold properties in retail parks and less popular regional centres.Debenhams has lost 90 per cent of its equity value in the past year after a series of profit warnings triggered by weak trading and increased discounting.

Last week Mike Ashley, the founder of Sports Direct, which owns a 29 per cent stake in the department store chain, ejected Debenhams’ two most senior directors from the board, fuelling expectations that he would takeover and restructure the business.

Debenhams is in refinancing talks with lenders but has said its property portfolio is a key burden, after it announced a record loss of £491.5m for the year to September.It is struggling with the legacy of a series of sale-and-leaseback deals made in the early 2000s, when the department store group was owned by private equity.Most of these were 30-year leases, but Debenhams also has even longer leases, which predate that era, including several that stretch to 2076 and one that ends in 2083, people familiar with the portfolio said. The bulk of these, in keeping with norms that prevailed in the sector until recently, include upward-only rent reviews.Among listed landlords, British Land owns eight stores — of which four are available for sale — along with Debenhams’ headquarters building; Intu owns six stores, Landsec five, while Capital & Regional has four, and Hammerson three.Intu already faces the impact of House of Fraser store closures.

The company, a rival to Debenhams that was bought out of administration by Sports Direct last year, is shutting four stores in Intu’s centres after it failed to reach a deal with the landlord on rent cuts.British Land has been seeking to sell four freestanding Debenhams stores, following other disposals including the department store’s Oxford Street branch.Funds run by large UK asset managers are also exposed: Aberdeen Standard Investments, for example, owns seven Debenhams stores, the Colliers data shows.

[debsdowner] 17/1/2019 22:13

News from Buckingham Palace

" Buckingham Palace wishes to confirm that speculation on various bulletin boards that Prince Philip was not breathalysed is simply incorrect. The Prince was not in a hurry to get to a Sale at Debtenhams, the Prince emphatically denied those allegations. The Palace has nothing else to say on the matter."

[fenners66] 17/1/2019 21:51

Debs - well they used the word profits -but that could be interchangeable with losses when they are not giving out their own forecast.

They then refer to the broker forecasts a summary I have posted above from Debs own website.

However since they show the range , have not specified the top middle or bottom and since most companies would identify a range rather than specific forecast - I still reckon they would claim they had not misled the market if they make a £10m Loss.

The other spin of course is what they actually mean by "profit" - which we all know means before everything they do not want to tell you in the headlines that actually leads to things like £500m Losses.

So adjusted or real pre-tax ?

My guess is of course it will be the "adjusted " number that they try to justify when they finally have to publish - (if they get that far) administration takes away that problem....

[debsdowner] 17/1/2019 19:56

fenner

Just looked at WEBFG forecasts and they have 2019 at pre tax of £4 million !

An absolute pittance and if they have been updated the company looks to me like it will end up in loss again as sales on the High Street continuing to decline.

[debsdowner] 17/1/2019 19:48

fenner

Are you sure where you are coming from on the point you raise?

Why I am saying that is a company will normally say its the lower or higher end of the "medium" forecast.

The medium forecast would therefore be £20 million profit!

If one accepts that methodology Moodys saying the company would likely make £20 million less than what was forecasting is a clear profit warning.

What normally happened with a profit warning is they have to miss forecasts by 10%.

[fenners66] 17/1/2019 19:12

To repeat a previous post :-

fenners66 - 10 Jan 2019 - 11:35:12 - 21831 of 22519 Debenhams charts/news - DEB
From the statement -

"Group is currently on track to deliver current year profits in line with market expectations[1], supported by further identified cost savings."

So I looked up [1] - which is referencing their page and it says

Consensus estimates
PBT £m EPS p DPS p PBT range £m No of estimates
FY19.......8.2.........0.5......0.0..........(10)-30................... 11

Read that carefully - "in line with market expectations"

Pointedly it does not say in line with Consensus estimates



Their own figures of market expectations show clearly a range of £-10m (Loss) to £+30m profit


I think they can say that if results lie in that range they have not misled the market........

[warik] 17/1/2019 18:56

I WOULD URGE DEBENHAMS HOLDERS TO STOP POSTING HERE AS THIS THREAD IS FULL OF DEBENHAMS HATERS AND SCUMBAGS AND HAVING NOTHING POSITIVE TO CONTRIBUTE.

WE ARE WASTING OUR TIME AND ENERGY POSTING AND RESPONDING.

IF WE STOP RESPONDING THEY ARE WRITING TO THEMSELVES AND YOU WILL BE TIRED AND GONE.

I HOPE ALL THESE HATERS BURN AND GO TO HELL.

[debsdowner] 17/1/2019 18:27

Guardian:

"After weak sales and pressure on profit margins over Christmas, Moody’s said it expected Debenhams’ underlying profits to fall by up to £20m this year, having previously predicted they would be similar to last year."

[debsdowner] 17/1/2019 18:22

According to Moodys Debtenhams profits are expected to fall £20 million worse than as forecast, so the company presentation was misleading.

So the press saying the company had not come out with a further profit warning when they updated on trading incorrect !

[debsdowner] 17/1/2019 18:14

Breaking news:

Prince Philip been involved in a car crash on the Sandringham estate.

According to one witness, they saw Prince Philip step out the Landrover apologetic, saying that he was in a hurry trying to get to the Debtenhams sale while they still had 70% off.

Apparently there was a bit of an argument when the police arrived one of the officers went to ask Prince Philip to do a breathalyser and the officer was told in clear and colourful language where to go!

The police will probably deny all this as a senior officer told the constable off.

If the papers do pick up on this you can bet your life this will cause a lot of controversy as the Royal Family should be treated like everyone else.

[debsdowner] 17/1/2019 17:58

Management changes at John Lewis and Waitrose which isn't surprising as I expect a significant fall in profits:

[discodave4] 17/1/2019 17:36

Numpty robot threatening people again, complete idiot (fact and proven by his posts).....grow up son.As you know, you need to be careful what you post, say no more.

[debsdowner] 17/1/2019 17:30

Drama at Debtenhams and outlook dismal says MoneyWeek:

The outlook at department store group Debenhams is dismal, while Mike Ashley, who owns 30% of it, has been putting his oar in. Matthew Partridge reports.
“There is a big question mark over the future of the department store as a concept,” says The Independent. But whatever eventually happens to that shopping format, the speed of the decline at Debenhams shows this one has got things “badly wrong”. It was reported this week Debenhams is planning to close a total of 90 stores, which could threaten 10,000 jobs.

“There is a big question mark over the future of the department store as a concept,” says The Independent. But whatever eventually happens to that shopping format, the speed of the decline at Debenhams shows this one has got things “badly wrong”. It was reported this week Debenhams is planning to close a total of 90 stores, which could threaten 10,000 jobs.

he embattled chain had already said it will shut around 50 stores over three to five years; it now seems the board thinks these plans don’t go far enough. Thanks to fewer shoppers, a large rent bill and intensifying online competition, the company’s market capitalisation has slumped from £1.7bn at its flotation in 2006 to the present value of £87m today, notes Ben Chapman, also in The Independent.

Such drastic cuts are necessary if Debenhams is to succeed in its “desperate fight for survival” says Sam Chambers in The Sunday Times. This is because the chain’s store occupancy costs were almost ten times its profit last year, a legacy of a “damaging” decision by the previous owners to sell the stores and then rent them back on 30-year leases. One way for Debenhams to implement these store closures without having to pay compensation is through a company voluntary agreement (CVA) which would allow Debenhams to cut rents and shut shops. However, this needs the agreement of landlords, and while some might accept this is a way to ensure they will at least be able to count on some income in future, those “who own many of its poorest-performing stores will be less accommodating.”

Another grenade from Mike Ashley
The situation has been complicated by the fact that last week Mike Ashley “rolled another grenade” into the Debenhams boardroom, says The Observer. He used his near-30% shareholding in the company “to oust the chairman and chief executive from the board at its annual meeting” last week.
Investors and the board were “caught napping” by this unexpected move. Ashley claims he simply wants to recoup “more than £100m” in losses on his investment in the company. But in that case why “pull the rug out from the under the management team”? It appears that “Ashley is trying to win control of the business on the cheap”.
His move could also damage vital negotiations with lenders, say Ashley Armstrong and Ben Marlow in the Sunday Telegraph. Debenhams will need a loan restructuring, which will involve getting creditors to write down their debt in return for shares. However, Mike Ashley is likely “to block any refinancing that would dilute his ­investment”. Such a move “will set the scene for an almighty battle between one of the high street’s most pugnacious characters and some of Wall Street’s most aggressive hedge funds”. The stand-off “would also risk pushing ­Debenhams into insolvency”.

[debsdowner] 17/1/2019 17:03

Two articles which highlight a deteriorating economy on business live. The housing market to slow down and Philips to close down a factory with the loss of 430 jobs blamed on Brexit warnings:

6:05
Philips to close UK plant with 430 jobs

"Electronics giant Philips is closing a plant in Glemsford, Suffolk putting 430 jobs at risk.
The operations will be transferred to the Netherlands.
The factory makes baby feeding products under the Avent brand.
Philips said the closure is part of a plan to reduce the number of plants it operates from 50 to 30.
Last year, the company's chief executive voiced concern about the impact of Brexit on the UK economy."

16:02
Housing market outlook worst 'for 20 years'

"The housing market outlook over the next three months is the worst for 20 years, surveyors say.
A net balance of 28% of Royal Institution of Chartered Surveyors (RICS) members expect sales to fall in the next three months.
It's the most downbeat reading since records started in October 1998 and the pessimism is blamed on the lack of clarity around Brexit.
Lack of supply and affordability also continued to affect the market.
Article share tools"



Comment:

Clarks announced a factory closure yesterday, unemployment has been low but expected to rise this year, those in work will be reluctant to spend or tighten their spending.

The problem with Debtenhams is its a mid market retailer and as such hasn't gotten the brand immge of Selfridges or John Lewis despite claims by the CEO to get rid of dated brands its not happened as yet. Its dated brands overpriced and it probably sells little at full price then has to discount at up to 70% or even more to shift stock.

I would have expected the company to have announced the financial reorganisation and funding by now but the low share price means a rights issue probably out it would have to be discounted at about 1 pence and heavily dilute present shareholders furthermore its pointless without a CVA.


The CVA neds to be done first otherwise any fundraise will not get any takers. The longer the matter takes the worst the situation will be as rent, rates, stock need funding. If the company doesn't hurry up administration could come instead.


However whatever happens there will be little to no value for present shareholders and surprised the share price is not trading between 1 to 2 pence at the moment, 2 pence is to high imo despite two brokers have that as a target price.

[this_time_its_different] 17/1/2019 14:29

RIP jack bogle

[titasiinitramho] 17/1/2019 14:15

his "holiday" is going about as great as your investment in DEBS is going.

Hammering Down another 4% today.


don't forget to do your own research.