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UPDATE 1-Debenhams cuts dividend and warns on outlook as profit halves

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LONDON, April 19 (Reuters) - British department store group Debenhams on Thursday warned on the full-year outlook for the second time in four months and cut its dividend as it reported a 52 percent slump in first-half profit.

The retailer, which issued a profit warning in January, also said Matt Smith, its chief financial officer, was quitting the retailer to become finance chief of rival Selfridges.

The 240-year old Debenhams is one year into a turnaround programme led by Chief Executive Sergio Bucher, a former Amazon and Inditex executive.

His plan to return Debenhams to profit growth involves closing some stores and revamping the rest, cutting promotions and improving its online service, while seeking efficiencies by simplifying the business.

However, progress has been hampered by a squeeze on UK consumers' budgets, a shift in spending away from fashion towards holidays and entertainment, as well as intense online competition.

Debenhams made an underlying pretax profit of 42.2 million pounds ($59.9 million) in the 26 weeks to March 3 - below analysts' average forecast of 44 million pounds and the 87.8 million pounds made in the first half of its 2016-17 year. Revenue fell 1.6 percent to 1.65 billion pounds.

It cut its interim dividend by 51 percent to 0.5 pence.

Debenhams said that based on its current view of the second half of the financial year, full-year pretax profit was expected to be at the lower end of the current range of broker forecasts of 50-61 million pounds.

It was previously guiding to 55-65 million pounds and made 95.2 million pounds in 2016-17.

Shares in Debenhams closed Wednesday at 23.3 pence, valuing the business at 288 million pounds. ($1 = 0.7041 pounds) (Reporting by James Davey, Editing by Paul Sandle)