British online fashion retailer Boohoo announced on Tuesday that it is rebranding itself as Debenhams Group, marking a significant shift in its business strategy. Alongside the rebranding, the company appointed Phil Ellis as its new chief financial officer (CFO).

The decision follows a successful turnaround of the Debenhams brand, which Boohoo acquired out of administration in 2021. Since then, Debenhams has been repositioned as Britain’s leading online department store, driving substantial growth and profitability for the Group.

The company stated, “While we continue to invest in our youth brands in the short term as part of their turnaround, we are increasing our medium-term EBITDA margin guidance for Debenhams to 20 percent. Our medium-term targets for Karen Millen and the youth brands remain unchanged, with double-digit EBITDA margins for Karen Millen and 6 to 8 percent EBITDA margins for the youth brands.”

Phil Ellis appointed as Group CFO

Reflecting the Group’s new strategic direction, Phil Ellis has been appointed as the new Group CFO, replacing Stephen Morana with immediate effect. Ellis previously served as finance director of Debenhams since 2022 and also holds the role of managing director of DebenhamsPay+.

Ellis has worked alongside Group CEO Dan Finley for over six years. Prior to joining Debenhams, he held senior financial roles at JD Sports for six years and spent seven years at The Very Group.

The company believes that Ellis' deep understanding of the Debenhams business and his close working relationship with Finley will accelerate the Group’s transformation into a Debenhams-led business.

Revenue decline despite strong Debenhams performance

Despite the strong performance from Debenhams, the Group's gross merchandise value (GMV) pre-returns declined by 10 percent year-on-year for the current financial year. Revenue for the period stood at 1.2 billion pounds (1.5 billion dollars), representing a 16 percent decline year-on-year.

However, driven by Debenhams turnaround, the company remains optimistic about its overall performance, stating that it expects to report adjusted EBITDA of around 40 million pounds for FY25. The company emphasised that Debenhams is now a fast-growing and highly profitable business under the leadership of Finley. The brand generated a GMV of 654 million pounds and net sales of 205 million pounds, with a 12 percent EBITDA margin.

Debenhams is also home to several Group-owned brands, including Wallis, Burton, MissPap, Coast, Oasis, Dorothy Perkins, and Warehouse. Collectively, these brands have now been turned around and are delivering a 7 percent EBITDA margin.

“We have a clear path to transforming Debenhams into a multi-billion-pound GMV business, with an EBITDA margin of 20 percent on net sales in the medium term,” the company stated.

Youth brands continue to face challenges

Boohoo acknowledged that trading conditions remain tough for its youth brands, including PLT (PrettyLittleThing), Boohoo, and BoohooMan. The Group has been heavily discounting stock to right-size inventory levels and realigning its marketing spend, which has impacted short-term performance.

“While we recognize the turnaround for these brands will take time, we remain confident in their long-term potential,” the company stated. It also noted that operating costs for these brands have been significantly reduced, paving the way for future growth.

The Group highlighted the successful transformation of Karen Millen, another leading brand under its portfolio, into a digital-first, premium global brand. For FY25, the brand is expected to deliver a GMV of 157 million pounds.

Boohoo remains optimistic that its shift to a Debenhams-led business model, coupled with continued brand turnarounds, will position the Group for long-term profitability and growth.