House of Fraser has reported flat EBITDA in its first half with like-for-like sales up 5.3% and warned the second half has started slower.

For the first half to July 30, the department store chain reported adjusted EBITDA of £12.2m compared to £13m, which allowed for set up costs associated with the opening of new distribution centre. Gross profits for the half were up 10 basis points.

House of Fraser chief executive John King said the first half performance is “testament to the fact that we are taking the right steps to fulfil our customers’ needs”. He added: “We have experienced a slower start to the second half, however we are encouraged by the pickup in the subsequent weeks.”

Current trading for the seven weeks of the second half started slowly due to the riots in August. Like-for-likes for the first three weeks were down 1%, but in the subsequent four weeks like-for-likes were up 3.9%, giving a combined total like-for-like sales for the first seven weeks up 1.9%.

King said: “There is no doubt that market conditions will remain challenging, and we will remain cautious for the remainder of the year, however we believe that our investments in our multichannel operations and store refurbishments combined with our exclusive house brand offering will continue to deliver growth.”

For the first half, online sales reported growth of 107.1%. House brand sales increased by 32% and net debt reduced to £235.4m from £275.7m.

HoF said four new house brands were introduced this year – Label Lab and Howick Tailored in menswear and Shabby Chic and Kenneth Cole in home, taking its total to 16.

The chain reported a store-wide initiative to improve customer service levels and a new standalone ‘Recognition Reward Card’ scheme.

The group said it remains focused on tightly managing cost base. Costs increased by £5.1m in the period. Approximately £3m of the increase related to the volume increases associated with the multichannel operations and house brands. In the period it opened a second DC.