House of Fraser to halve debt

Baugur-backed department store group House of Fraser expects to halve its debt burden by the end of this year. The retailer was taken over by a consortium, whose members include Scotland's richest man Sir Tom Hunter, for £351.4m last year. HoF chairman Don McCarthy, who is also a Baugur board director, said the group's sales performance had been better than its five-year plan anticipated, and that he expects to 'be well ahead' by the end of the current financial year.

He expects debt levels to come down from six times earnings to around three-and-a-half times. In its last year as a public company, HoF made profits of £27.3m on sales of £700m.

www.houseoffraser.com
23 July 2007

House of Fraser to launch smaller chains

Department store chain House of Fraser is planning to launch a national chain of small stores on the high street. The plan could prove a major blow to Debenhams. One of the growth strategies outlined when Debenhams' private equity owners Texas Pacific Group, CVC and Merrill Lynch Global refloated it last year was the potential to expand the high street spin-off, Desire by Debenhams.

Downsizing enables the retailer to open shops in catchments that would not support a full-blown department store. Debenhams has opened seven Desire stores, which sell women's clothing and accessories, and has another two in the pipeline. Sources close to HoF said the plan was at the 'drawing-board stage' but it was actively scouting small store locations.

www.houseoffraser.co.uk
2 April 2007

HoF prepares designer kids chain

House of Fraser intends to open its first chain of designer concessions for children. It is currently in talks with childrenswear licensee, Children Worldwide Fashion, which already supplies designer labels for children to over 200 British store. CWF is planning to debut new collections by Escada, Chloé and Missoni in the fall. “We are opening Children Worldwide Fashion concessions in four stores for autumn 2007,” Allan Winstanley, director of menswear and childrenswear for House of Fraser, told Vogue. The news was confirmed by a spokeswoman for the department store group. The company is hoping to open more concessions going forward, but nothing has been confirmed yet, she said.

CWF is already supplies House of Fraser with brands such as Timberland, Elle, DKNY and Burberry. “Brands are House of Fraser's main point of difference from standalone high street shops, and we feel that the new CWF concessions will stamp a strong brand identity into our childrenswear,” Winstanley said.

www.houseoffraser.co.uk
1 March 2007

House of Fraser bounces back

Department store group House of Fraser has reported a strong trading performance over the Christmas period. During the four weeks to 30 December, the firm saw a 7.3% rise in same-store sales compared with a year earlier.

House of Fraser, which has 60 stores across the UK, also said its profit margins were in line with expectations. The company was acquired by a consortium led by Icelandic investment group Baugur for £351.4m ($686m) in August last year. "These strong figures show that House of Fraser remains the customer's number one choice for designer brands," said House of Fraser in a statement to the BBC. Baugur now owns a number of UK High Street names, including the Iceland supermarkets, jeweller Mappin & Webb, and toy store Hamleys.

www.houseoffraser.co.uk
5 January 2007

HoF infuriates suppliers

House of Fraser has angered its suppliers by announcing that it will take ninety days to pay them. The department store group added that it its demanding a 5 percent discount on goods paid for before 1 January. According to media reports, the group has enraged its suppliers. This is said to be the most hostile action taken against suppliers by a British retailer. One wholesale supplier to the chain, Ted Baker, was “hopping mad”, according to a report by the Scotsman. When contacted for a reaction, Ted Baker declined to comment. House of Fraser officials were unable to comment at press time.

House of Fraser was recently taken private by the acquisitive Icelandic retail group Baugur, Scottish entrepreneur Sir Tom Hunter and HBOS.

www.houseoffraser.co.uk
5 December 2006

House of Fraser revamp starts with logo

House of Fraser, since its takeover, is modernising its department store offer in a move to win back customer loyalty. Regarded as a major move, the Group, which was recently taken over by Baugur investment group, is proposing to drop its stag logo as part of a drive to modernise the company's image. The logo reportedly dates back to early twentieth century when the emblem was introduced to represent the Scottish Fraser family. Hugh Fraser, the son of a Dunbartonshire farmer, co-founded the company in 1849.

The Group's decision is part of a plan revamp the House of Fraser brand which in recent seasons has been uninspirational to customers, wants to be known as “house of fashion, fragrance, footwear and fun”. Executive Chairman Don McCarthy, who owns a stake in the company, said the group was already experimenting with new designs for the front of its Oxford Street store. “We need to add excitement to the store image to reflect the exciting plans we have for inside the store,” said McCarthy.

House of Fraser underperforms all of its department-store peers. In order to turn the business round, McCarthy hopes to win back customers in its core 35-plus age group by improving the mix of clothing concessions in-store. House of Fraser, which has 61 stores across the UK, is also planning to open 10 smaller outlets of about 75,000 sq ft each in city centres over the next five years. Stores are being planned at the new White City shopping centre in west London, High Wycombe, Belfast and Bristol.

www.houseoffraser.co.uk
21 November 2006

House of Fraser will see revamp under new owner

Baugur, the group that owns House of Fraser, has stated it wants to ‘shake up' the boring high street. The group this week officially took over the department store group and is set on spending a formidable sum to bring House of Fraser back into the foreground. In recent years, the HoF has lagged behind stores such as Selfridges and John Lewis, who's fashion offering was deemed dull and uninspiring.

John King was named chief executive of House of Fraser on Wednesday as expected, and the group was taken over in a £351m (€523.4m) deal by Baugur-led consortium Highland Acquisitions. The sale is Baugur's biggest acquisition in the UK, and turnover for its companies is estimated at £10bn.

As was reported in The Times on Thursday, Baugur's head Asgeir Johannesson stated the group will take two years to turn around the store chain. As part of the overhaul, Johannesson said he planned to ditch the bulk of House of Fraser's 14 brands, including Rackhams, Binns and Army & Navy, and introduce new names to inject some originality into Britain's "boring" high streets... "What is boring about the British high street is the duplication," he told the newspaper.?"High street stores are the same and those same store brands are in the department stores. We have the opportunity to bring in exciting brands and spice it up a bit."

Johannesson said Jenners, the Scottish chain bought by House of Fraser last year, would be the only regional name retained in the long run. He also pledged to spend "tens of millions" on modernising the stores. John King joins House of Fraser from Matalan since and is due to start early next year, replacing John Coleman, who stepped down from his 10-year post after completion of the takeover. King will work alongside executive chairman Don McCarthy, who set up the Shoe Studio Group in 1991. He replaces Michael Wemms.

www.houseoffraser.co.uk
9 November 2006

King to head up HoF

John King has been named chief executive of House of Fraser, which was acquired by a Baugur-led consortium for £351 million. King, boss of discount chain Matalan, will replace John Coleman early next year. Having joined Matalan in 2003, King has more than 20 years' experience in retail and manufacturing. Coleman is thought be receiving a golden hand shake of at least £515,572 on top of a payout of £1.17 million from long term investment plan shares. Furthermore, he will also receive up to £4.7 million from shares he already owns. The group has also appointed Don McCarthy as executive chairman, replacing Michael Wemms. He will join from the Shoe Studio Group, which he founded in 1991.

Icelandic retail group Baugur is extremely active in the British fashion market. Its takeover of House of Fraser is its biggest in the UK to date. It also owns fashion chains Whistles and Karen Millen, coffee and tea specialist Whittard of Chelsea, royal jeweller Mappin & Webb, and food retailers Iceland and Booker.

www.baugurgroup.com
9 November 2006

House of Fraser sees sales growth

Total sales at House of Fraser grew by 7.6% against the previous year, reflecting the incremental sales from Beatties, Jenners and newly opened stores, partly offset by the closure of Regent Street and Kensington. On a like for like basis, sales declined by 2.5 per cent on the same period in the previous year.

John Coleman, Chief Executive of House of Fraser, said 'Despite a tough period of trading we have continued to achieve a great deal across the business - bringing in new and exciting brands and ranges across all our stores, relaunching our private label Linea, integrating Jenners and Beatties and continuing our programme of low cost refurbishments.

This has been a busy period for the Company, culminating in the recent offer from Highland. It is testament to our employees that they have strengthened the overall customer proposition and business model despite the distractions of the offer process and this is reflected in our good current trading figures. I would like to thank them all for their hard work and continued support.'

www.houseoffraser.co.uk
26 September 2006

Baugur makes bid for HoF

Icelandic group Baugur has made a bid of £351 million for House of Fraser. The bid values to the British 61-store chain at £1.48. House of Fraser has agreed to be taken over by the consortium led by Baugur, which includes HBOS, entrepreneur Sir Tom Hunter, Karen Millen founder Kevin Stanford and Icelandic investor FL Group. The transaction signifies the end of a three years battle by Baugur to acquire the chain. Pending shareholder approval the deal will come into effect on 8 November. “We believe the proposed price represents good value for House of Fraser shareholders, particularly in the context of a challenging trading environment,” said Jon Asgeir Johannesson, president and chief executive of Baugur Group, in a statement. The FT quotes analyst Richard Ratner of Seymour Pierce as saying that the offer is “not over-generous by should be accepted”. “For those that are hesitant, they should reflect upon the fact that, every year, the market has started with a forecast for House of Fraser which – and this is no adverse comment on the management – has invariably come back during the course of the year.” House of Fraser said Baugur would review the chain's product mix and space allocation and would concentrate on opening new stores and refurbishing existing stores.

www.baugur.is
30 August 2006

Baugur seeks new finance for HoF takeover

Baugur, the Icelandic retail investment group, is close to securing a refinancing of its Julian Graves health food chain in a deal that could see it recoup much of the £21.5m it spent buying Whittard of Chelsea, the specialist tea retailer. The refinancing comes after Baugur secured a recommendation for its £350m takeover offer for House of Fraser, the department store chain.

Although talks with lenders on the new finance package have yet to reach a conclusion, a deal is expected soon. Gunnar Sigurdsson, the managing director of Baugur's UK business, said: "The Whittard of Chelsea deal was structured through Julian Graves, a company we bought in 2003. It was Julian Graves that bought it.

"There will be a refinancing of Julian Graves, but it's not clear that there will be a lot of cash to come out of that for shareholders. It remains to be seen." Baugur refinanced Iceland , the frozen food retailer, this year. That deal allowed the company to recoup the acquisition finance it put up to fund the £160m deal. The Icelandic group's takeover of House of Fraser will be part-financed by a sale and leaseback deal on the House of Fraser headquarters, close to Victoria station in London . The deal is estimated to be worth between £30m and £35m.

Some House of Fraser shareholders have warned that they will reject the deal. The rebellion is being led by Robin Geffen, the chief investment officer of Neptune Investment Management, which holds almost 4 per cent of the company's shares. Geffen said: "This is not a fair valuation at all. This is a bid from a rich boys' club that has been formed to get hold of assets that are owned by the small shareholders at half price.

"House of Fraser will make £31m in profits this year. That values the bid at just over 10 times earnings. It's an insult." He added: "They're getting together to drain all the cash out of an overcapitalised business. It's just like CVC did with Debenhams - Baugur will vomit this back to the stock exchange in three years' time with all the goodies having been ripped out." According to Neptune 's analysis, the Baugur consortium could potentially extract 80p a share through sale and leaseback deals, and a further 125p a share by using the company's dividends to refinance the business. Geffen claims that the consortium could be in a position to withdraw 205p a share in cash from the business within just three months. "We're going to fight to the death on this one," he said.

www.baugur.is
29 August 2006

Baugur formalizes House of Fraser offer

House of Fraser received a formal offer from Baugur and associates last night for 148p a share. The board said that it intends to recommend the offer at 148p a share, which would be structured as “scheme of arrangement” bid. Shareholders will vote on the deal at an extraordinary meeting set for October 3. HoF also issued a trading update, reporting that LFLs fell by 1.6% in the 29 weeks to mid-August. This represents a modest improvement on the -2.4% reported for the first 19 weeks to early June.

Baugur already holds a 9.5% stake in House of Fraser. The offer by the consortium - which includes the Icelandic investment group FL, footwear entrepreneur Don McCarthy, TBH Trading, and Karen Millen's founder, Kevin Stanford - is being made via Highland Acquisitions.

www.houseoffraser.co.uk
25 August 2006

House of Fraser bid target

House of Fraser has been a bid target since 1996, when John Col eman took the job of chief executive. City editor Glynn Davis is keen to remark he has done a decent job of keeping the business ticking along and fending off various bidders during his tenure (which is an achievement in itself) but also says it must have been frustrating to know what that the only real way of taking the company forward was to use it as a major consolidator in the sector. Although this has happened to some extent with the purchase of Beatties, HoF has still remained a target from even bigger predators.

The latest approach from Baugur looks increasingly likely to give Col eman something akin to ‘closure' on his time at HoF with the company playing its final part in the sector's continued consolidation. With the news that HBOS intends to take an equity stake in HoF (as part of Baugur's £350 million approach) the buy-out of the department store group now looks closer than ever.

It certainly seems to make a good fit for the Icelandic operator as its intention to showcase its other retail businesses through concessions in HoF stores makes great sense. It is just such synergies that are an increasing requirement for any private equity-type deals in the retail sector because take-out prices have climbed to the point whereby it is difficult to get the numbers to stack up without them.

24 July 2006

HoF underlying sales continue to fall

House of Fraser has predicted a tough year ahead as it reported a further drop in underlying sales. As a result of weak consumer spending, the department store said like-for-like sales for the 19 weeks ended 10 June dropped 2.4 percent. Last year that decline was 1.3 percent.
Total sales, however, rose 8.8 percent thanks to new store openings and added businesses from the recently acquired Jenners and Beatties. Gross margins were also up thanks to less promotional activity.
“In March we said that we anticipated that the trading environment would remain difficult for the first half of 2006 and that we expected to experience further cost pressures,” said chief executive John Coleman. “This remains our view.”
Some analysts believe that the buyout offer from Baugur is promising for the company’s stock, but others are more reticent. Analysts from Merrill Lynch cautioned that HoF’s weak trading and sluggish real estate portfolio made for an unattractive leveraged deal, possibly leading Baugur to try to lower the price, wrote the FT.

www.houseoffraser.co.uk
15 June 2006

House of Fraser takeover draws closer

House of Fraser, the owner of Edinburgh department store Jenners, is expected to be in Icelandic hands by mid-August. HoF , which bought Jenners just over a year ago, is understood to have informally approved a £350m takeover approach from Icelandic investors Baugur. Baugur will complete due diligence and return with a final decision within the next few weeks.

On Friday, HoF said that "discussions are continuing relating to a potential cash offer of 148p a share". But analysts cautioned against such a high offer for the firm. Richard Ratner, head of equity research at Seymour Pierce, said: "We have been expecting an offer to emerge at this level since Baugur bought a 9.5% stake in a dawn raid in April. "Baugur is serious, without a doubt. But there is a lengthy due diligence process and in the meantime plenty of water can flow under the bridge.

"Having said that, we think a deal will go ahead about mid-August." Baugur is believed to have already made contact with Bank of Scotland about co-financing the deal with an Icelandic bank. It is not yet sure whether Scottish entrepreneur Sir Tom Hunter will come in and partner Baugur. Baugur and Hunter have teamed up on a variety of deals, including Hunter's £445m takeover of Wyevale Garden Centres.

Last night a spokesman for West Coast Capital, Hunter's investment vehicle, said the two had not made contact with regards to the HoF bid but there was an informal arrangement to discuss any deals. He said: "If Baugur do proceed, we have an arrangement where we can speak to them with regards to coming in." In December 2002, Hunter tabled an unsuccessful 85p-a-share offer for HoF with Baugur's support. The Icelandic group is known for its acquisitive nature. It has already snapped up a string of brands from women's fashion to children's toys.

12 June 2006

House of Fraser accepts Baugur bid

Talks of bids for House of Fraser were confirmed today as the high street department store accepted an indicative £356m offer from Icelandic retail investor Baugur. The decision means Baugur now has access to House of Fraser's confidential financial information. The Icelandic investor, whose past British investments include Hamleys and Whittards of Chelsea, has now begun a process of due diligence. That is likely to take the best part of six weeks, and, if all goes to plan, a firm offer could be on the table by mid-August.

Baugur's interest in House of Fraser, which is being advised by Dresdner Kleinwort Wasserstein, first emerged in April when it carried out a 'dawn raid' on the company's shares, buying 9.5pc of the equity. The highest price Baugur is believed to have paid is 130p-a-share. The Icelandic investor then approached House of Fraser to say it was interested in the possibility of making an offer. On May 2, House of Fraser admitted it had received a 'very preliminary approach' from an unnamed third party. Baugur's interest came six weeks after talks between House of Fraser and private equity house Apax Partners ended. Baugur, led by chief executive Jon Asgeir Johannesson, is leading the charge for the department store retailer, but is thought to be doing so on behalf of a wider consortium.

9 June 2006

Baugur in talks with House of Fraser

Baugur, the Icelandic investment group, confirmed last week that it was in talks with House of Fraser about making a cash offer for the department store group. Shares in House of Fraser rose more that 5 per cent yesterday in anticipation of an offer. Baugur said it was "in discussions with the board”. “Discussions are at an early stage and there can be no certainty that an offer would be forthcoming", Baugur said in a statement last night.

30 May 2006

Bid speculation at House of Fraser

Takeover speculation surrounding House of Fraser has heightened after the High Street group confirmed it had received an approach from a potential buyer. House of Fraser described the interest by an unnamed suitor as "preliminary", but one which could eventually lead to a full takeover offer. Newspaper reports have linked Icelandic investor Baugur with a possible takeover of the department store chain. Separate takeover talks involving House of Fraser collapsed earlier this year.

In March, the company unveiled a small rise in annual profits, although it said sales - excluding new store openings - had fallen by nearly 4%. House of Fraser has been at the centre of a number of takeover approaches in recent years, including one by Scottish businessman Tom Hunter, although no deal has successfully been sealed. In a statement, the firm said: "The board of House of Fraser notes recent press speculation and confirms that the company has had a very preliminary approach that may or may not lead to an offering being made for the company."

The Times on Monday reported that Baugur, which is run by Icelandic entrepreneur Jon Asgeir Johannesson, was believed to be behind the latest takeover approach. The acquisitive Icelandic firm - which has invested heavily in a number prominent UK retailers including Hamleys toy stores and Woolworths - snapped up 10% of House of Fraser shares last month. Shares in House of Fraser closed up almost 1% at 119 pence on the London Stock Exchange on Friday.

Baugur in possible HoF approach

House of Fraser said this weekend that it had received a “very preliminary approach”. The department store group added that this offer might possibly lead to a takeover offer. The FT reports that the offer is thought to come Icelandic group Baugur. The acquisitive group bought a 9.5 percent stake in House of Fraser in early April, but has refused to comment on this. If Baugur is indeed the bidder, it will be the second time it has shown interest in the chain. In 2003 it bought a 21 percent stake in House of Fraser before selling it a year later.

Earlier this year, private equity group Apax Partners was in “very preliminary” talks with the chain, but these ended in March. House of Fraser was valued at £281 million at the end of last week. In the year ended 28 January 2006 , pre-tax profits dropped to £22.3 million from £58.9 million, due to a turnaround in exceptional items. Underlying profits rose 4.6 percent.

www.houseoffraser.co.uk
1 May 2006

HoF shares surge on “dawn raid” rumours

The sudden exchange of nearly 10 percent of House of Fraser stock had the industry once again speculating about a possible takeover. A “dawn raid” – which involves a rapid move on the market – caused the department store's stock to surge 8.6 percent. The move was said to be to acquire 6 percent of the business.

Private equity firm Apax was thought to be behind the move as it had been the one behind earlier takeover talks, which ended last month. It was thought Apax was backing a management buyout, which valued House of Fraser at about £290 million. The Financial Times reported today that Icelandic investment group Baugur is once again interested in the company and is believed to have bought spent £28 million on 9.5 percent of the stock. It is also thought that 3.7 percent of that stake was bought from London-based hedge fund Blue Crest Capital.

The acquisitive Baugur recently also acquired a 10 percent stake in Woolworths. It is not yet known if the “dawn raid” signals the approach of a takeover bid, although one source told the FT that it was likely that Baugur was taking a strategic stake in the company, taking into account that House of Fraser stocks several clothing brands owned by Baugur. These include brands such as Karen Millen and Whistles.

Baugur also owns brands like Hamleys, Goldsmiths and grocery retailer Iceland . House of Fraser owns 60 stores throughout the UK and a branch in Dublin . The company said like-for-like sales dropped 3.9 percent during the year ended 28 January. However, the rate of decline slowed down to 1.3 percent in the subsequent seven weeks. Annual profit last year increased 4.6 percent to £27.3 million.

www.houseoffraser.co.uk
7 April 2006

House of Fraser to update own label Linea

Linea, House of Fraser's longstanding own label is to get a makeover for autumn/winter 06. Linea, which has been sold in House of Fraser stores since 1997 has begun to look tired and outdated compared to its other brands, and will see a sound investment to freshen its look. HoF Chief Executive John Coleman told Draper's Record: “We'll look at new ways of displaying the brand and there will be a bit of repositioning too. We've got some very loyal House of Fraser customers and this is the ideal time to rebuild our own label and attract them to return to it.”

The department store group has already made changes to its own label supply chain that that have cut lead times. It is believed HoF is further considering another womenswear own label to sit between Linea and its classic range Platinum.

House of Fraser, who closed its Dickens & Jones store on Regent Street this year, saw pre-tax profit more than halved to £22.3 million from £58.9m for the year ended January 29, but last year's results were flattered by a large property sale. Underlying profit was up 4.6% to £27.3m, thanks to better promotions and improved margins. Total sales increased 11.2% to £1.01 billion, boosted by store openings and acquisitions. Like-for-like sales were down 3.9%.

4 April 2006

Good start for HoF

House of Fraser has recorded a sales rise of 15.6 percent in the first seven weeks of this financial year 2006/7. The department store chain said that the year has started off ahead of expectations. Total sales rose thanks to last year's acquisition of Beatties and Edinburgh department store Jenners. Like-for-like sales dipped 1.3 percent during the period, with an overall drop in like-for-like sales in 2005/6 of 3.9 percent. Nevertheless, the company said recent results were better than expected.

“We previously expected trading during the first of 2006 to be difficult, although we are pleased that the first seven weeks have been ahead of our original expectations,” said chief executive John Coleman. Nevertheless, the company warned that it expected the retail market to remain challenging for “at least the first half” of this year. Meanwhile, pre-tax profits dropped to £32.8 million in 2005/6, down from £58.9 million the year before. Underlying pre-tax profits before exceptionals were up 4.6 percent to £27.3 million. Turnover climbed to £709.1 million from £649.6 million.

www.hof.co.uk
27 March 2006

No bid for House of Fraser

Department store House of Fraser's shares have tumbled after it revealed takeover talks had come to nothing. Its stock fell 13% in early morning trading as it also reported that like-for-like sales had fallen 1.4% in the six weeks since 29 January. Private equity firm Apax Partners had been seen as a likely suitor for the store chain, which said last month that it was in "preliminary talks". Analysts had valued the House of Fraser group at about £300m.

The group operates about 60 department stores in the UK and Ireland, after acquiring the Beatties and Jenners chains last year. Including these new stores, House of Fraser's sales were up 16.2% in the six weeks since 29 January. The group reiterated a report given earlier this year that it expected trading conditions to be difficult for at least the first half of 2006 and forecast cost pressures over the next 12 months. The firm made a £3m loss in the first six months of the current financial year, but experienced an improvement in sales in the run-up to Christmas. It has closed a number of stores, including Dickins & Jones in London's Regent Street.

House of Fraser in bid

Apax is gearing up for £300m plus bid for House of Fraser. House of Fraser said after the market closed on Friday that it had received a ‘preliminary approach' that may or may not lead to an offer for the company. Apax could make an indicative offer as early as next week, although negotiations are at a very early stage.

It is unclear whether House of Fraser's executive team of John Coleman and David Adams are working with the private equity stalkers but this is thought likely by many retail insiders. Permira will decide this week whether to make a renewed bid for HMV. Permira's initial approach was rebuffed earlier this month. It is understood that Permira's business plan does not include the sale of Waterstones, HMV's book chain.

Profits slide at House of Fraser

House of Fraser is close to issuing a profit warning after a sales slump, according to retail insiders. Like for like sales are believed to have been down by double – digit or high single-digit amounts for five of the past seven weeks. A banker close to the group said “How they have not had to issue a profit warning I don't know” A spokesman for HoF said “The company understands its obligations. It has got a trading statement scheduled for January 12. If it needs to do a trading statement earlier it will” Other retailers such as M&S and John Lewis are seeing positive sales growth.

House of Fraser in White City opening

House of Fraser is believed to be in preliminary talks to open a flagship store in the White City shopping centre which is being built a few miles away and is due to open in 2007. The White City development will be the largest shopping centre in greater London and is expected to have an impact on the shopping areas such as Kensington, Bayswater and Brent Cross.

www.houseoffraser.co.uk
22 August 2005

HoF closes Barkers

The 135-year old Barkers store on Kensington High Street is closing its doors, House of Fraser has announced. The British department store chain said that the closure was in response to the changing shopping habits of Londoners. Two months ago it also surrendered the lease on the Dickins & Jones on Regent Street , although apparently for very different reasons than the closure of Barkers. “We closed Dickins & Jones because of a massive rent rise, while the decision to close Barkers was founded purely on shopping trends,” said House of Fraser.

The FT reported that there is talk of House of Fraser being in preliminary discussions to open a flagship store in the new White City shopping centre, which is currently being built not too far from the current Barkers location and will open in 2007. “People wanting designer brands are really heading to Bond Street or Oxford Street or big shopping malls, rather than shopping in Kensington,” said House of Fraser.

The chain said that it had sold the lower ground, ground and first floors of the building to Whole Foods Market, a US food retailer. The top floor would be rented by Asscoiated Newspapers, which currently occupy the upper floors. Barkers' 112 employees are being opportunities at other House of Fraser stores in London or in the south east.

Analysts believe that exit costs related to the sale will result in exceptional losses estimated at around £500,000. Analyst Rhys Williams of Seymour Pierce told the FT: “Whilst Barkers has always been profitable, with the White City shopping centre development opening in two years' time, now looks like a good time to get out of the lease.” Williams also said that the new White City Mall – which will be the largest shopping centre in greater London – is expected to impact the local shopping areas greatly, especially Kensington, Bayswater and Brent Cross.

www.houseoffraser.co.uk
22 August 2005

House of Fraser buys Beattie's

Department store chain House of Fraser has decided to purchase rival James Beattie for GBP 69.4 million in an effort to boost its presence in the UK. In a statement on Tuesday, House of Fraser revealed that it will pay 168 pence per share for Beattie.

Beattie shares rose 10.9 per cent to 162.5 pence in early trading on Tuesday, reaching their highest level in three years. House of Fraser Chief Executive, John Coleman, said: "The addition of the Beattie stores will add 653,000 square feet of profitable retail space, strengthening House of Fraser's nationwide coverage."

www.houseoffraser.co.uk
28 June 2005

House of Fraser sales drop

British department store operator House of Fraser Plc today reported that its like-for-like sales had dropped 3.2 per cent. The decrease is the first in the 19-week period since the start of the financial year. The gross margin rate has also dropped.

In a statement the company said: "Trading conditions in the retail market have continued to be challenging in the early part of this year. Management continue to take further actions in driving margin and cost improvements." House of Fraser is not the first retailer to report disappointing results. Many have suffered as a result of the series of interest rate hikes from November 2003 until last August.

Bank of England Governor Mervyn King said in statement in regional newspaper Bradford Telegraph & Argus this week: "Clearly, there has been a slowdown in the High Street. But sometimes the headlines do tend to overreact to the significance of any one event."

www.houseoffraser.co.uk
16 June 2005

House of Fraser Acquire World Oldest Department Store

Department store House of Fraser have acquired Jenners - the historic Edinburgh store - for £46m. HoF, which last week stated it was in talks with Jenners, said it had reached an agreement to acquire the retail business and retail assets of Jenners for 46.1m. HoF is also taking over Jenners pension scheme and will make a £3.4m contribution.

Jenners is the oldest independent department store in the world, having traded from 48 Princes Street, Edinburgh, since 1838. The deal includes the Princes Street store, a long leasehold store at Loch Lomond Shores, and leases of stores at Edinburgh and Glasgow airports. All will continue to operate under the Jenners name.

HoF said the deal further strengthens its position as the UK's leading retailer of designer brands, and complements its existing Scottish stores in Glasgow and Edinburgh. There is also a potential benefit from adding the Jenners storecard into HoF's financial services operation.
Jenners has around 750 employees and in the year to January 30 generated an unaudited gross transaction value of £49.1m and unaudited pre-tax profit of £2.7m. All four branches traded profitably last year and trading in the first six weeks of the current year has been up 2.3 per cent.

John Coleman, chief executive, said: "House of Fraser has a strong Scottish heritage and recognises the landmark position of Jenners and the iconic status that the name has in Scotland. The Princes Street store will be a valuable addition to House of Fraser's existing store portfolio, alongside our existing store in Edinburgh at the opposite end of Princes Street. This transaction represents an exciting opportunity for Jenners' employees in the enlarged group."

Robbie Douglas-Miller, managing director of Jenners, said: "The directors of Jenners believe the benefits of this deal are significant to all parties. The famous name of Jenners goes forward, there are exciting opportunities for the staff of Jenners and Edinburgh continues to have a premier department store operating on Princes Street."

20 March 2005

House of Fraser may acquire Jenners

House of Fraser is in talks to acquire the venerable Scottish department store business Jenners.

HoF said it is in "advanced negotiations" over adding Jenners to its existing chain of department stores, but plans to retain the Jenners brand identity. Along with the flagship Jenners store on Princes Street in Edinburgh, the business includes outlets at Glasgow and Edinburgh airports, and at Loch Lomond Shores.

HoF said all the stores would continue to operate under the Jenners name, and if the deal goes ahead, it plans to operate the Princes Street store alongside the existing House of Fraser store in Edinburgh.

16 March 2005

House of Fraser To Leaseback Stores To Improve Funds

House of Fraser, in a bid to improve its finances and reduce debt, has agreed sale and leaseback deals for its Cirencester and Shrewsbury stores.
The department store group will enter into new 35 year leases on both stores and continue to trade as usual.

After taxes and costs, as well as the 3.1m book value of the stores, the deal will see HoF's with a profit of £10.1m. which will be used to reduce its longstanding debt. The group has now completed a similar deal on its Manchester store, making an exceptional gain of £12.3m. HoF has given further insight of its financial services partnership with Barclaycard, which will see the credit provider take over the store's customer credit accounts.

The cash payments made by Barclays Bank to the group between January 2005 and January 2007 are expected to total around £25m, with an additional performance related payment of around £10m is due in January 2008. The total cash generated from the property transactions and the financial services partnership with Barclaycard will be over £60m by January 2008, with over £30 million received by the end of January 2005, used to reduce debt.

31 December 2004

House Of Fraser Shares On Market

More that one-fifth of shares in House of Fraser are being put up for sale, prompting a new round of City speculation on a takeover of the department store group. Dealers said that investment bank Dresdner Kleinwort Wasserstein is looking to place 49.2m House of Fraser shares on behalf of an unnamed party. The holding amounts to around 21 per cent of the total shares in the business.

Last month it was reported that entrepreneur Tom Hunter, who launched an ultimately unsuccessful takeover attempt for House of Fraser towards the end of 2002, could be selling his 11 per cent stake in the business. House of Fraser has been regularly linked to a merger with rival Allders over recent years. Allders itself is likely to be under new ownership soon as a result of the planned sale of its majority owner, property company Minerva.

13 September 2004

HOF Shares Sold

More that one-fifth of shares in House of Fraser have been sold after entrepreneur Tom Hunter and Icelandic retail group Baugur put their stakes up for sale. Investment bank Dresdner Kleinwort Wasserstein placed 49.2m House of Fraser shares, amounting to around 21 per cent of the total shares in the business.

14 September 2004-09-13

New Stores To Boost Sales At House Of Fraser

UK department store House of Fraser is focusing on margin improvements to deliver growth as the retail sector continues to find sales hard to come by.

HOF, specialising in designer brands, told shareholders in a statement coinciding with the group's annual meeting that in the first 19 weeks of the current financial year, like-for-like gross transaction value was up 0.4 per cent year-on-year. That matches City forecasts of broadly flat sales.

With the gross margin rate up on last year by over 70 points, HOF said the combined figures add up to a like-for-like gross margin improvement of more than 2.5 per cent.

Chief executive John Coleman said: "We are pleased with the current trading performance with continued growth in both sales and gross margin. "The work undertaken to manage costs has continued successfully. This activity, combined with the improvement in the like-for-like gross margin, means that the company is confident of a satisfactory trading outcome for the 26 week period ending July 31.
"The company has a strong new store opening programme and is on schedule to open its Croydon store in September with a further three new stores set to open in 2005."

"Given the continued improvement in trading and the expected benefits from the new store openings, the company remains positive on its future prospects."

16 June 2004

House Of Fraser Sees Increase In Profits

Department store retailer House of Fraser saw a slight increase in profits after a tough trading year. Total group turnover ell from GBP703.5m in the year to the end of January 2003 to GBP693.6.

House of Fraser saw profit before tax and exceptionals increase by 11 per cent to £27m. The profits increase was driven by £13m in cost savings achieved in the year, with total costs reduced by 2 per cent.

24 March 2004

Sales Flat But Level For House Of Fraser

House of Fraser has reported flat like-for-like sales over the second half of the year, with total sales dipping due to store closures and refurbishments. The department store operator said it had delivered a 'creditable' performance in a tough market, and said that cost savings implemented in the business had kept the business on track for the full year.

In the 23 weeks to January 3, like-for-like sales were up a minimal 0.1 per cent, with total sales down by 1.7 per cent, with comparisons hit by disruption from refurbishments in the current year, as well as store closures last year in last year.

Over the 49 weeks of the year to date, HoF said like-for-like sales are level, with total sales down 2.5 per cent. HoF said margins across the year are slightly ahead of last year, and discounting, particularly pre-Christmas markdowns, has been tightly controlled. Its cost control programme will generate more than £13m in savings this year.

Chief executive John Coleman, said: "The strength of our position as Britain's leading retailer of designer brands has enabled the business to deliver a creditable trading performance in a difficult retail environment. Further, our focus on gross margin and costs means that we are on track to deliver a satisfactory trading outcome for the year.

"As we enter 2004, we look forward to the autumn opening of our largest new store to date, the 140,000 square feet unit anchoring the new Centrale scheme in Croydon and the future store openings in Dublin, Maidstone, Norwich, Belfast and High Wycombe over the following three years."

8 January 2004

House of Fraser Announces Revamp

High Wycombe is to be the next site where UK department store chain House of Fraser is to be part of a major face lift. Continuing to roll out their store portfolio and development programme, House of Fraser has closed the sites where there is underperformance and is looking at new stores in Croydon, Dublin, Norwich and Belfast. House of Fraser chief executive stated: "Our success to date reinforces our confidence in our store strategy and we believe that it will continue to deliver results going forward."

5 November 2003

House of Fraser New House of Luxury

House of Fraser's new store, unveiled earlier this month in the City of London, is geared to the Square Mile's affluent, time-poor customer.

The new store, which over looks London Bridge, focuses on fashion, cosmetics and a limited selection of homeware gift items. The line-up of luxury brands, set against the backdrop of a sophisticated store environment, marks a departure for the department store group. IT is reminiscent of Harvey Nichols' boutique store in Birmingham's Mailbox.

It certainly rings true that people who work in the Square Mile are used to luxurious surroundings, whether it is the hotels they stay in, such as the Great Eastern on Liverpool Street, or in the places where they eat or drink. Due to the restricted space of the former bank building, the emphasis was on keeping the overall effect light, airy, with a subtle sense of luxury.

The store also puts great emphasis on customer service with the possibility of garments and cosmetics to be brought to their workplace if they have limited time to browse. Companies can also organise exclusive shopping evening for their staff.

9 October 2003

House of Fraser Targets City Workers

House of Fraser is launching a high profile marketing-campaign targeted at cash-rich but time-poor City workers to coincide with the opening of its new store in the Square Mile next month.

Advertising will appear in Underground stations around the City of London and on LBC Radio, as well as in The Financial Times and Evening Standard from September 9.

The 43,000sq ft store in the former Guardian Royal Exchange building on King William Street will open from 8am to 7pm on weekdays, with late opening until 8pm on Wednesdays. The store will be closed at weekends. The boutique format, which will sell fashion and cosmetics with an emphasis on top designer brands, will be a "one-off."

HoF is keen to introduce a more aspirational brand mix to its other shops and the city store will further change people's perception as having more of a fashion edge.

3 September 2003

New House of Fraser is Brand Conscious

The new House of Fraser store to be opened in the City of London this September, will have an emphasis on top designer brands, many of which are new to the department store, and will not be sold in other branches.

The 43,000sq ft boutique style store will cover five floors of the former Guardian Royal Exchange building on King William Street.

Designer womenswear buyer Caroline Withey has brought together first time brands such as Paul Smith Pink, Catherine Malandrino, Jean Paul Gaultier, Armani Collezioni and Ollie & Nic.

New menswear labels include Hugo Boss Black, Earl Jean and Versace.

The store, which overlooks London Bridge, is aimed at the City worker and commuter, a more discerning shopper, perhaps, than their profile customer.

24 June 2003