LONDON (ShareCast) - (Sharecast News) - Fast fashion retailer Boohoo Group has changed its name to Debenhams, it confirmed on Tuesday, as it overhauls its business model amid ongoing "tough" trading.
AIM-listed Boohoo said Debenhams, which it bought out of administration in 2021, was now growing "rapidly".

It continued: "The business model is stock-lite and capital-lite. It is very profitable and highly cash-generative.

"The group sees significant growth opportunities for Debenhams, with a medium-term ambition to create a multi-billion pound GMV (gross merchandise value) business with a target of around 20% EBITDA margin on a net sales basis."

As a result, Boohoo will now adopt a similar marketplace approach across the business, including changing the company name with immediate effect.

It has also replaced chief financial officer Stephen Morana with Debenhams' finance boss Phil Ellis.

Boohoo said: "The Debenhams marketplace-led business model, proprietary technology and lean operating model will be extended across the group. This is critical to the turnaround of the youth brands and will help accelerate value creation in Karen Millen."

Group revenues in the year to February 2025 slid 16% to £1.2bn, with revenues from its core youth brands - PrettyLittleThing, Boohoo and Man - falling to £947.3m from £1.2bn. In contrast, Debenhams saw revenues rise to £204.6m from £186m.

GMV was down 10% year-on-year, at £2.3bn.

Boohoo acknowledged that recent trading had been "tough" for the youth brands.

The retailer has endured a difficult period post pandemic. Sales have slid, hit hard by growing competition, while returns and costs have mounted. Under-fire co-founder Mahmud Kamani stepped down as chair in November, and John Lyttle resigned as chief executive.

It has also faced a boardroom battle with Mike Ashley's Frasers Group, one of its main shareholders. The retail tycoon, who believes the business has been "mismanaged", sought to be installed as Lyttle's replacement, but Boohoo appointed Debenhams head Dan Finley instead.

Further attempts by Ashley to be appointed to the board have also been rebuffed.

Speaking on Tuesday, Finley said: "The successful turnaround of Debenhams is our blueprint for the wider turnaround of the group.

"The turnaround of our youth brands is underway and will take time. I have inherited significant challenges. I can see their future potential as they evolve into fashion-led marketplaces and adopt a leaner operating model.

"This is a defining moment in our journey, reflective of our new strategy, new leadership and new beginnings."

As at 0900 GMT, shares in Boohoo were up 1% at 27.63p.

Katie Cousins, analyst at Shore Capital, said: "The group has seen a number of downgrades and misses of late, and against a challenging UK consumer backdrop, we believe visibility for Boohoo is low.

"Focusing on the more profitable and cash generative division is sensible in our view."

However, Cousins reiterated Shore's 'sell' rating, due to "our low confidence and persistent competition against the group's main operating divisions".

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