2011 performance: KPIs | Debenhams Annual Report and Accounts 2011

Financial key performance indicators

Strategy	2011 performance	KPI
Gross transaction value
Gross transaction value (GTV) is a measure of overall sales in the business and includes both own bought sales and concession sales. The board believes GTV is a good guide to the overall level of activity in the Company.	Debenhams reported a pleasing increase in GTV of 4.5% in 2011 (2.9% on a 52 week basis). It was driven by new UK store space from stores opened in 2010 and 2011 and growth in Magasin and the international franchise stores as well as online sales growth in the UK.	Gross transaction value £m
Like-for-like sales
Like-for-like sales provides a measure of annual sales performance from stores that have been open for one year or more. This metric is therefore an indication of organic sales growth.	Like-for-like sales for the 52 weeks to 27 August 2011 fell by 0.3%. On a VAT inclusive basis, like-for-like sales grew by 1.2%. This was a creditable performance given the bad weather during peak trading which we estimate impacted like-for-like sales by c.1% across the year as a whole.	Like-for-like sales growth %
Headline profit before tax
Headline profit before tax is the board’s principal measure of profitability.	Headline profit before tax grew by 10.0% in 2011 (up 4.4% on a 52 week basis). The main driver of growth was a lower interest charge resulting from the reduction in net debt and a lower interest rate following refinancing of the bank facility which was negotiated in July 2010 and took effect in October 2010.	Headline profit before tax £m
Net debt
Net debt is the KPI used by the board to measure balance sheet strength. Ensuring the Company has an appropriate capital structure to support its strategic aims is clearly vital.	Net debt fell sharply in 2011, ending the year £133.1 million lower than at the start. As well as strong cash generation, net debt benefited from the cancellation of a number of finance leases. Leverage (calculated as net debt divided by EBITDA) at year end stood at 1.4 times.	Net debt £m

Non-financial key performance indicators

Strategy	2011 performance	KPI
Own bought sales mix
The mix of sales between own bought and concessions is an important driver of gross margin. Own bought sales produce a higher margin than concession sales.	Own bought sales increased slightly in 2011 to 80.4% compared with 80.2% in 2010. Improvements in the own bought mix from the store modernisation programme were offset by a better performance from some concessions. Our medium-term target remains 85%.	Own bought sales mix %
Trading space
Trading space is driven by new store openings and expansion of existing stores, usually when they are being modernised. A disciplined approach to capital expenditure ensures strong returns are generated from new space.	Three new stores were opened during the year adding a total of 193,000 sq ft of trading space. The store portfolio at year end comprised 163 stores in the UK and Ireland and 6 in Denmark. We believe we could trade from up to 240 stores across the UK and Ireland.	Trading space m/sq ft
Online sales
The development of Debenhams’ multi-channel business is a key part of the Company’s strategy. Online sales are a good indicator of the performance of Debenhams’ multichannel activities as a whole as the website is the largest of the non-store sales channels.	2011 was another year of strong growth in online sales. Total sales increased by 73.8% on a 53 week basis and like-for-like sales on a 52 week basis grew by 71.9%. We expect to grow online sales to £500 million over the medium-term.	Online sales £m