Department store operators Harrods, Harvey Nichols and Fenwick have reported resilient trading over the past year, despite the bleak retail landscape.
Harrods had a record year in terms of sales, which rose 9% to £751.7m in the year to January 31, driven by strong demand for international luxury brands. The retailer declined to provide current trading figures but said sales have remained “strong” so far this year.
Gross profit margin remained in line with last year and pre-tax profits were £56.2m against £55.4m the year before.
Harvey Nichols chief executive Joseph Wan revealed the department store group was “in recovery” after profits slumped 40% in the year to March 31. He said: “In the first four months of the current year we have had a good financial recovery. We are exceeding budgets.”
Wan put the success down to a number of counter-recessionary tactics including adopting an aggressive mark-down strategy and focusing on stock replenishment.
He added that the retailer’s Knightsbridge store in London is trading 1% ahead on a like-for-like basis as overseas visitors, particularly Europeans, are attracted by the weakness of the pound.
Like-for-like sales at the group as a whole are running “about flat”.
Wan said he was confident that profits would be ahead of the £10m recorded in the previous year and added: “The economy as a whole will show volatility for the next year or two but the financial situation has stabilised.”
Fenwick, which operates 10 department stores including Bentalls and Williams & Griffin, revealed that net sales, which include concession partners’ sales, grew to £363.4m in the year to January 30, compared with £350.3m the year before. Turnover was £289.9m, up from £283m. Pre-tax profits were £35.6m, down from £41.8m in 2008.
In documents filed at Companies House, Fenwick said the environment will “continue to be competitive” but that it “remains confident in the future of the group”.
➤ Irish department store Arnotts is understood to be in talks to secure its trade credit insurance position. It is unclear whether insurance has been reduced or if it is seeking someone to underwrite it.