The country's No. 2 department store group Debenhams said on Monday it would meet its profit expectations and that a Femme Fatale look in women's fashion was helping to revive trading after a sluggish early summer.

There was no real fashion trend in the summer at the young end (of the market), Chief Executive Rob Templeman told Reuters. But there's definitely more trend merchandise out there now.

We think black and red and hound's tooth (fabric) what we're calling Femme Fatale will be quite big, he said in a telephone interview. We're certainly seeing that in our designer products at the moment.

Debenhams, which returned to the stock market in May after 2 1/2 years in private equity hands, said in a trading update like for like sales rose 0.5 percent in the 52 weeks to September 2.

This compared with a 1.7 percent rise after 32 weeks.

The firm said profit before tax and one off items for the period would meet its expectations, but did not give a figure.

Analysts are looking for a number of around 165 million pounds.

Retailers are generally struggling as debt laden shoppers cut back on spending amid rising interest rates and utility bills, and clothes shops were hit particularly hard by a hot July.

Rival Next said last week it expected like for like sales to fall between 2 percent and 5 percent in its fiscal second half, after a 7.5 percent drop in the first half.


Debenhams, like Next, said there were signs of an improvement in trading, and also said its gross margin a measure of profitability had continued to rise.

But Evolution Securities analyst Nick Bubb was not won over.

It's a cheap stock that looks like it's going to stay cheap, he said.

Debenhams shares returned to the stock market at 195 pence apiece, at the bottom of an indicative range of 195p to 250p, and have underperformed in the retail sector <.FTASX5370> by 7 percent since then.

Investors are concerned the firm is losing ground to bigger rival Marks & Spencer and that its private equity owners have left little value in the business.

Private equity groups Texas Pacific, CVC and Merrill Lynch retained a 43 percent stake at the flotation.

At 07:50 GMT, Debenhams shares were down 1 percent at 190p, valuing the firm at about 1.6 billion pounds. The stock trades at about 13.8 times forecast earnings, compared with Marks & Spencer on 16.7, according to Reuters Estimates.

Templeman said Debenhams, which has 131 department stores and five smaller Desire shops, expected to open three department stores and at least 10 Desire stores this financial year.