Debenhams Group lifts outlook as turnaround boosts profits and cuts debt

An announcement from boohoo group Plc ( (GB:DEBS) ) is now available.

Debenhams Group reported forecast Adjusted EBITDA of £53 million for the year to 28 February 2026, a 36% increase and comfortably ahead of earlier guidance, driven by a 76% rise in second-half performance. The group said all brands remain profitable on an Adjusted EBITDA basis, with gross merchandise value trends improving for three consecutive quarters and exiting February just 5% below the prior year.

Management highlighted strong progress on its multi-year turnaround, centred on shifting to a stock-lite, capital-lite marketplace model and aggressively cutting costs. Fixed costs have been reduced from £175 million to an exit rate of £119 million, capex has nearly halved, and lease and interest expenses are set to fall further as non-core assets are exited and the business deleverages.

Net debt stood at £90 million at year-end, supported by a £40 million fundraise, bringing leverage to under 2x Adjusted EBITDA and with guidance for net debt to fall below 1x in FY27. The Board expects materially better free cash flow as exceptional costs ease, depreciation drops sharply in line with a smaller asset base, and marketplace growth supports further working capital efficiencies.

Against this backdrop, the Board raised guidance for FY27, now expecting double-digit Adjusted EBITDA growth on the stronger £53 million base. The directors said the reset cost base, completed warehouse consolidation, tech re-platform and strengthened brand management leave the group well placed to return its brands to growth and enhance its competitive position as an asset-light online marketplace operator.

The most recent analyst rating on (GB:DEBS) stock is a Sell with a £16.50 price target. To see the full list of analyst forecasts on boohoo group Plc stock, see the GB:DEBS Stock Forecast page.

Spark’s Take on DEBS Stock

According to Spark, TipRanks’ AI Analyst, DEBS is a Neutral.

The score is driven primarily by weak financial performance (sharp revenue decline, ongoing losses, high leverage, and negative operating cash flow). Technicals are also bearish with the stock below key moving averages, despite oversold readings. Valuation provides limited support due to a negative P/E and no dividend yield data.

To see Spark’s full report on DEBS stock, click here.

More about boohoo group Plc

Debenhams Group, part of boohoo group plc, operates an online platform focused on fashion, home and beauty, serving millions of customers across five shopping destinations: Debenhams, Karen Millen, boohoo, MAN and PrettyLittleThing. The business has evolved from the historic Debenhams department store brand into a portfolio of fashion-led online marketplaces targeting UK and international consumers.

Average Trading Volume: 4,857,412

Technical Sentiment Signal: Strong Sell

Current Market Cap: £261.8M

For a thorough assessment of DEBS stock, go to TipRanks’ Stock Analysis page.