Shares in Debenhams plummeted more than 17 per cent at the open after it emerged the retailer has brought in advisers in an effort to turn the business around.

The department store has issued three profit warnings this year, and announced a series of job cuts, while its share price has tumbled by two thirds since January.

Debenhams has appointed advisers from KPMG to look at options for the future of the business, which could include a potential company voluntary arrangement, and possible store closures, which would put jobs at risk.

The chain is also said to be looking into selling its Scandinavian business, Magasins du Nord, as part of a strategic review of non-core assets it announced in June.

In a statement released on Monday afternoon, Debenhams said its results out in October would fall in line with expectations, with net debt of around £320m.

The company said it had continued to strengthen its financial position, and added that the early weeks of the new season “have shown more positive trends and any sustained upturn would result in a rebound in our profit performance”.

Debenhams chief executive Sergio Bucher said: “The market environment remains challenging and underlying trends deteriorated through the summer months. Nevertheless the product and format improvements we have tested are gaining traction and we are ready to scale up some of our strategic activity ahead of peak.

“Having put in place a leaner operational structure and strong leadership team, and taken action to strengthen our financial position, we are well equipped to navigate these market conditions and take advantage of any trading opportunities that emerge."

The retailer’s chairman, Sir Ian Cheshire, said: “As we stated in June, the board continues to work with its advisers on longer term options, which include strengthening our balance sheet and reviewing non-core assets. This activity is in order to maximise value for shareholders and protect other stakeholders, including our employees.

Debenhams’ decision to appoint advisers comes amid a downturn on the British high street, with a number of household names facing severe financial difficulties.

AJ Bell’s investment director, Russ Mould, said the market is “clearly taking seriously” the reports that KPMG has been appointed to advise Debenhams.

He noted: “The struggles at Debenhams follow the collapse of rival House of Fraser into administration over the summer and another thing both have in common is a material presence on the shareholder register for Mike Ashley’s Sports Direct.

“Speculation that he might launch a bid for Debenhams after capturing House of Fraser in August is likely to follow.”