Struggling British department store chain Debenhams (DEB.L) is closing 50 of its underperforming stores, putting around 4,000 jobs at risk, as write-downs in the value of its business led to a record full-year loss of nearly 500 million pounds ($645 million).
Chief Executive Sergio Bucher said he was “taking decisive steps to strengthen Debenhams” in a challenging market.
“We are taking tough decisions on stores where financial performance is likely to deteriorate over time,” he said on Thursday.
Bucher, a former Amazon (AMZN.O) executive, is trying to keep Debenhams relevant to British shoppers who are increasingly buying online and spending less on clothes.
The cuts are deeper than Bucher’s original plan to close 10 stores, downsize others and renegotiate leases and rents on its estate.
Last month, Debenhams denied it was actively planning a major cull of its 166-store UK estate.
“We want to have fewer but better stores, with a better shopping experience,” he told BBC radio.
“We want to grow our online business and we want the whole of the organization to be more profitable.”
Debenhams shares were down 2.4 percent at 8.3 pence in early trading.
The British retailer, which has issued three profit warnings this year, took exceptional charges of 512.4 million pounds relating to leases and goodwill, leading to a statutory loss of 491.5 million pounds, the biggest in its 240-year history.
Underlying pre-tax profit for the year to Sept. 1 slumped 65 percent to 33.2 million pounds, a result that Bucher said reflected “a tough year for retail”.
Debenhams is not the only retailer that has suffered on Britain’s high street.
BHS went bust in 2016, House of Fraser was bought out of administration in August by Mike Ashley’s Sports Direct (SPD.L) and even market leader John Lewis [JLPLC.UL] has warned on profit.
Sports Direct owns just under 30 percent of Debenhams but has ruled out a bid.
Bucher told BBC radio that the number of jobs losses from the store closures over the next three-to-five years had not been quantified.