Sales were up 1.3 per cent for the year to the end of August, with like for likes down 0.9 per cent.
As expected, the company halved the dividend to shareholders. Trading has worsened since the year end, with like for likes down 4.2 per cent.
Debenhams admitted that its level of debt "appears to be negatively impacting valuations of the company."
To reduce it, the company is to target up to£15 million in cost reductions and reduce capital expenditure by£40 million in 2009. It will also reduce options in stores by a further 13 per cent.
Chief executive Rob Templeman said he was pleased with the growth in sales and that Debenhams market share had increased by 0.3 per cent. He said the outlook remained tough: "We will remain focused on managing the business tightly in light of difficult and uncertain market conditions," he said.