Debenhams Group hails turnaround success as every brand turns profitable

The online fashion and home group posted a 35% year-on-year increase in adjusted EBITDA to £53.3m for the year ended 28 February 2026, while gross margin improved for the first time since 2022 to 51.1%. 

Group chief executive Dan Finley said it has been a “year of decisive action”, where it reset its cost base, including reducing headcount from over 6,000 to 1,500, consolidating its warehouse, replatforming tech and rightsizing stock levels. Finley described the turnaround as “firmly on track”. 

He said: “This has been a year of significant and successful transformation for Debenhams Group. Since my appointment as group chief executive in November 2024, I have been sharply focused on executing our multi-year turnaround strategy – and the progress is clear. We delivered £53.3m of adjusted EBITDA, up 35% year on year following two trading upgrades and turned every brand profitable on the same basis.”

The retailer said all brands under the Debenhams umbrella were now profitable at the adjusted EBITDA level, with Debenhams’ adjusted EBITDA improving from £25m last year to £34.8m, and PrettyLittleThing shifting from a £1m loss to £14m profit.

Group GMV fell 21.6% to £1.82bn during the period, which the retailer attributed to a deliberate shift away from volume towards profitable sales as it transitions to a marketplace model. 

“The rebrand to Debenhams Group in March 2025 marked the defining moment. Our capital-lite, stock-lite, cost-lite, cash-generative marketplace model has now been rolled out across the entire Group. FY26 has been a year of decisive action.”

“We consolidated all warehouse operations into Sheffield, delivering £33m of recurring savings, unified three technology platforms into a single AI-powered stack saving £38m annually, renegotiated over 150 contracts for £35m in savings, refinanced the group and raised £40m through an oversubscribed equity raise, and reduced statutory losses after tax by £218m year on year.”

Finley added that the focus for the group was now on growth, and group GMV for Q1 FY27 was up 0.5% year on year, while May 2026 trading had been “particularly strong” at 8% GMV growth, and June was “continuing to be strong”.

“We continue to guide to double-digit improvement in FY27 adjusted EBITDA underpinned by the continued marketplace transition, with net debt targeted below 1x adjusted EBITDA by year end,” he said.

“With the most significant restructuring phases substantially complete and exceptional costs expected to reduce materially, FY27 is expected to be the year of further future profit growth and sustained free cash flow generation. We have stayed disciplined, delivered results, and laid the foundations for more resilient, profitable and sustainable growth – and the best is yet to come.”