Store group Debenhams says its half-year profits dropped seven per cent but business is on an upward path and clothing sales stronger.

Like-for-like sales, stripping out new store space, were down 3.4 per cent in the autumn but cheered over Christmas, helped by customers snapping up gifts and home and beauty products.

The retailer, which has stores across Sussex, reported that the new year had sparked further buying and January and February saw comparable sales up 1.8 per cent.

Chairman Peter Jarvis said: "Total sales are ahead of last year and are benefiting from the recently-opened stores and stronger clothing sales."

But during the half-year to February 26, pre-tax profits fell from £79.4 million to £73.8 million. And turnover suffered, down to £775.1 million from £785.2 million.

Sales during the year had been hurt by a number of stores being closed for redevelopment. Mr Jarvis said: "We continue to outperform most of our competitors and believe the interim results are a creditable performance given the market circumstances."

Finance director Matthew Roberts said sales of women's clothing had been stronger, while menswear had also been doing well.

Debenhams said during the last six months it had invested in developing its brands and extending product availability through store openings, the internet and home shopping.

It launched a number of designer labels in its stores, including Red Herring and Kickers, and plans to expand its designer lines through all Debenhams stores by Christmas.

Shareholders will be paid an increased interim dividend of 4.2p, up from 4.1p last time.

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