Debenhams hikes earnings outlook and decides to keep PrettyLittleThing

The owner of Boohoo and Debenhams has upped its annual earnings outlook and scrapped plans to sell off the PrettyLittleThing brand as turnaround efforts pay off.

The Debenhams Group, which was renamed last year from Boohoo, said it now expects underlying earnings of £50 million for the year to February 28, up from previous guidance for around £45 million and higher than then £41.6 million reported in 2024-25.

It said: “This is a result of the continued momentum in our Debenhams brand, a discernible improvement in the performance of our youth brands and accelerated progress on our transformation plan.

“All our brands continue to trade profitably.”

The group added it was “particularly pleased” with the revival plan at PrettyLittleThing and its improvement in profitability.

“Given the success we are seeing with the turnaround, the momentum it is building and the substantial opportunity ahead as a fashion-led marketplace, the brand will be retained,” it said.

But it said it would continue to look at selling other “non-core” parts of the business to reduce debts over the coming year.

Chief executive Dan Finley is leading a major turnaround after losses and flagging sales.

In August last year, the business said it was considering the sale of its PrettyLittleThing brand as part of the overhaul, having already secured around £50 million in annual savings and cut its staff headcount by 30% to help transform operations.

The group narrowed losses in its first half, reporting a pre-tax loss on continuing operations of £2.5 million for the six months to August 31, shrinking from a £130 million loss a year earlier.

It said the improvement in performance has been driven by the online Debenhams brand, which saw gross merchandise value and earnings grow over the half-year.

But group revenues fell by 23% to £296.9 million over the half-year.