Fortnum & Mason has reported a strong Christmas trading period after Covid restrictions and store closures caused it to swing to its first full-year loss in 12 years.
In the full year to July 2021, Fortnum’s reported losses before tax of £2.7m, down from a £0.6m profit the previous year, blaming “the impact of temporary store closures, higher supply chain costs and the continued decision to now draw on government’s furlough relief”.
Turnover also fell 6% in the period to £132m off the back of nine months trading with tiered restrictions and lockdowns combined with “sharply lower domestic and international footfall” to its five stores.
However, the retailer hailed a much stronger festive period, reporting a 21% year-on-year increase in sales for the five weeks to December 26, 2021.
Fortnum’s said better stock availability and the addition of 700 seasonal staff contributed to this upturn, particularly around its online sales.
Online sales in December jumped 65% after the government announced working from home guidance amid the spread of the Omicron variant across the UK.
Across the year, the retailer’s online sales grew to be worth 55% of all revenues with the greatest demand being seen in wine, home entertainment, fresh and deli food, and hampers.
The retailer said much of this growth was driven by customers shopping on their mobiles. The retailer was able to add 500,000 new digital customers over the year.
Fortnum & Mason chief executive Tom Athron said: “I have been so impressed with the agility of the Fortnum’s team as we reacted to a first-changing world and in particular the performance of our digital channels. As a direct result, we have expanded the brand’s reach and welcomed many new customers and encouragingly this trend has continued since we reopened our shops and restaurants in the summer of 2021 – we now have a domestic business that has almost doubled in size over the pandemic. Christmas was exceptionally strong as customers put us at the heart of their plans to properly celebrate.
“Looking ahead, the broader outlook remains uncertain and we are seeing the same cost pressures materialise, as others in our market have reported. However, I am confident that 2022 will be an exciting year for Fortnum’s, building on this momentum with continued investment in our Piccadilly flagship as well as our technology capabilities and increased capacity to support the growth in demand, both here and overseas.”
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