Debenhams shares plunge again, market cap hits rock bottom
today Nov 15, 2018
Struggling Debenhams is under even more pressure as its shares continued their downward trajectory on Thursday, falling almost 9% in the first couple of hours after the markets opened, having lost over a fifth of their value on Wednesday.
That may not seem important to some but it means that the biggest (as far as store numbers are concerned) of the UK’s traditional multi-brand department stores, now has a market capitalisation of only around £64 million.
To put that in context, Joules’ market cap is over £220 million, Ted Baker’s is almost £800 million and failed rival House of Fraser, with fewer stores, was purchased in the summer at a ‘knock-down price’ of £90 million.
Debenhams’ shares could be bought for less than 5p each on Thursday. They started the year at 35p each and had been at their all-time high in 2006 when one share cost over £2 shortly after the company was first listed.
The plunge this week came on the back of recent weak results, the problems that are also being seen at competitor House of Fraser, but mainly because of reports that claimed a number of suppliers have stopped working with the retailer.
As we saw earlier with HoF, the last thing a struggling department store needs is spaces on its shelves and rails where in-demand brands used to be.
There are major concerns over Debenhams’ survival prospects and given that it has 165 stores and employs 27,000 people, that’s understandable.
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