Kurt Geiger has reported an increase in its operating profit for the financial year, despite the bad debts it accrued as part of the House of Fraser administration.

The upmarket shoe retailer posted operating profit of £27.9m for the year ending January 26 2019, up from £24.6m the previous year, while its operating margin increased to 8.4% compared to 7.6% the previous year.

Group revenues increased by over £10m, to £334.7m, while its overseas wholesale operation grew 100% as it expanded its US business.

Kurt Geiger reported gross profits of £184.1m, up from £176.8m the previous year.

This growth came despite the evident challenges being faced by its concession partners in the UK such as struggling department store chains House of Fraser and Debenhams, and deeper discounting on the high street.

The concession tie-up with House of Fraser stung Kurt Geiger’s bottom line for the year, incurring £4.1m of bad debt.

Lead retail analyst at GlobalData Kate Ormrod said the biggest future avenue of growth for Kurt Geiger lay not in footwear but in handbags and accessories.

She said: “The biggest opportunity for Kurt Geiger remains outside its footwear specialism, with handbags the fastest-growing category in its retail business in 2018/19, growing by 23% in net turnover.

“Its Kensington and Shoreditch styles are proving particularly popular and Instagram-friendly, and with bags a higher-margin product, seizing its growth potential in this category will help drive overall profitability in 2019/20.’’