Debenhams closes in on new boss as first-half profits rise

LONDON, April 11 (Reuters) - Debenhams (Other OTC: DBHSF - news) , Britain's second-largest department store group, said it was close to naming a new boss as it beat forecasts with an 5.5 percent rise in first-half profit, putting it on track to meet full-year expectations.

Last October Michael Sharp announced he planned to step down as chief executive at some point in 2016 after five years in the job.

Debenhams said he formally submitted his resignation to the board on Thursday.

He will continue as CEO until his successor is confirmed to ensure a smooth handover.

Debenhams said it made an underlying pretax profit of 93.8 million pounds ($132.5 million) in the six months to Feb. 27.

That was ahead of analysts' average forecast of 91 million pounds and the 88.9 million it made a year earlier.

Sales rose 1.6 percent to 1.63 billion pounds, with sales at stores open over a year up 1.1 percent and its gross margin up 20 basis points.

The better performance reflects less discounting, fewer promotions, a decrease in the proportion of clothing in the overall product mix, and online service improvements.

"Although there is plenty more to do, we are on track to deliver full-year results in line with market expectations," said Sharp.

Analysts' average forecast for 2015-16 pretax profit is 118.2 million pounds, according to Reuters data, up from 113.5 million in 2014-15.

Shares (Berlin: DI6.BE - news) in Debenhams on Wednesday closed at 77.4 pence, valuing the company's stock at 954.4 million pounds.

($1 = 0.7078 pounds) (Reporting by James Davey; editing by Jason Neely)