Beatties owner hit by 'volatile' trading on the high street

Earnings – a measure of profit before tax – to fell to £1.1 million from £9.2m a year ago, partly due to an expected £3.9m drop in in financial services income.

Sales figures for the six months of £573.5 million were flat on last year, although on a like-for-like basis sales were up 0.9%

Chief executive Nigel Oddy said: "We have, like many of our peers, experienced an extremely volatile trading environment since the final quarter of fiscal year 2016, and we expect this uncertain economic situation to remain for some time.

"Despite these challenging market conditions, we are pleased to have delivered like-for-like sales growth, improved cash and gross margin and increased gross profit in the first half. This is a real credit to our business and our teams."

House of Fraser has also struck a new deal with toy store Hamleys, which is taking concessions in six stores in time for Christmas. The chain has also refurbished five of its estate of 59 UK stores, which include branches in Telford, Shrewsbury and Birmingham.

New concessions are being launched for brands such as Charlotte Tilbury, All Saints, Monsoon, and Mulberry and the company, owned by Chinese group Sanpower, is on track to open its first store in China, in Nanjing, later this year.

The company employs 6,000 House of Fraser staff and another 11,500 work at the various in-store concessions.

House of Fraser's executive chairman, Frank Slevin, added: "The UK retail sector is facing significant change in structural dynamics as consumers shopping habits and delivery expectations continue to evolve

"Whilst we are still at the very early stages of our international expansion plans, we are pleased to be opening our first Chinese store in Nanjing. The store will clearly demonstrate the unique status that House of Fraser can achieve in the market and will be a standout platform for our concession and brand partners."

Since the half year, HoF has witnessed "further challenging trading conditions and low consumer confidence" across the retail sector. With the disruption from revamp work at five stores, House of Fraser's sales in the last eight weeks has fallen by two per cent on last year.

But it is gearing up for the "all important" Black Friday and Christmas trading period, which typically delivers around 85 per cent of the chain's profit.