Boohoo has changed its name to Debenhams – after reviving the popularity of the 247-year-old department store brand.
The fast-fashion group bought Debenhams out of administration in 2021, dispensing with its bricks and mortar network in a major blow to the High Street and switching to an online operation.
Now, chief executive Dan Finley wants to use the success of the venture as a ‘blueprint’ to transform the ailing fortunes of the wider group, declaring: ‘Debenhams is back.’
However there are no plans for the brand to return to the High Street. Finley said it would be ‘Britain’s online department store’. Shareholders will vote on the rebranding at a meeting later this month.
Since being bought for £55million, Debenhams has become ‘very profitable’ and is ‘growing rapidly’, Boohoo said yesterday.
Debenhams is one of a number of old High Street brands that are owned by Boohoo, with others including Wallis, Burton, Coast, Oasis, Dorothy Perkins and Warehouse.
Fashion show: TV presenter Hannah Cooper-Dommett models for Debenhams which is now owned by fast fashion group Boohoo
Russ Mould, investment director at investment platform AJ Bell, said: ‘The idea of going to a vast department store on the High Street or retail park to buy an array of goods went out of fashion in the modern world, yet the concept is now alive and well online.
‘That’s how Boohoo has managed to resuscitate one of the UK’s best-known shopkeepers.’
However, the group’s so-called youth brands such as Boohoo, Pretty Little Thing and MAN seem to have been harder hit by trends such as the post-pandemic fall on online shopping and competition from cut-price rivals such as Shein.
A trading update yesterday revealed the contrasting fortunes of the two divisions. Overall revenues at the wider group
fell 16 per cent to £1.2billion in the year to February. For the youth brands, sales were down 21 per cent to £947million.
But the old High Street brands of Debenhams and others were up by 10 per cent to £205million. Karen Millen, also owned by the group, saw a 2 per cent decline to £68million.
Boohoo shares fell 4.6 per cent yesterday to 26.08p, adding to losses of 22 per cent over the past year.
Matt Britzman, senior equity analyst at broker Hargreaves Lansdown, said: ‘A name change doesn’t change the fact that sales are falling.’
A review which could see some brands spun off or sold is ongoing – and yesterday’s name change has added to speculation that they will be offloaded.
But retail analyst Nick Bubb suggested that ‘nobody is queuing up to buy the young brands, given the competition from [Chinese online fast-fashion giant] Shein’.
The rebrand comes after a prolonged tussle between the group’s management and its biggest shareholder Mike Ashley, who controls retailer Frasers Group. Ashley last year lost an attempt to win a board seat.
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