Debenhams Group (LSE:DEBS) has outlined plans to raise approximately £35 million through an equity placing aimed at bolstering liquidity and reshaping its balance sheet. Directors have indicated their intention to subscribe for shares at 20 pence each. The company is also in detailed discussions with its lending syndicate regarding covenant revisions tied to the capital raise, with a goal of reducing its net debt-to-Adjusted EBITDA ratio to about 2x in FY27 and to below 1x by the end of that financial year.
Management reaffirmed its expectation of delivering £50 million in Adjusted EBITDA for FY26, followed by double-digit growth in FY27. Trading trends show improving gross merchandise value, while cost-saving measures continue to take effect. The group stated that all of its brands are now profitable on an Adjusted EBITDA basis. As part of its transformation, Debenhams is accelerating a shift toward an asset-light structure, trimming lease commitments, capital expenditure and interest costs. Additional deleveraging options under review include intellectual property licensing, supply-chain collaborations and potential disposals of non-core assets to improve cash flow and financial flexibility.
Despite strategic progress, the company’s outlook remains constrained by its financial history and valuation pressures. While recent share price action indicates some near-term positive momentum, overbought signals suggest caution. Corporate initiatives offer potential upside, but balance sheet repair and sustained profitability remain critical to restoring investor confidence.
More about Debenhams Group
Debenhams Group, trading as boohoo group plc, is a UK-based online retail platform specialising in fashion, home and beauty. The business operates digital brands including Debenhams, boohoo, PLT, MAN and Karen Millen, and is transitioning toward a marketplace-led, asset-light model designed to enhance scalability and capital efficiency.
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