The luxury department store Harrods generated record sales during its last financial year after benefitting from overseas shoppers returning to London since the end of the pandemic.
Accounts filed in Companies House show the retailer’s revenues rose 8.0% to £898.4m over the 53 weeks to 3 February 2024, with operating profit up 2.8% to £162.9m.
Commenting on the results, a spokesperson for Harrods said: “These results reflect a period of significant growth for the luxury industry in 2023. The current domestic and global economic environment has meant that current trading conditions in the luxury sector are more challenging.
“We remain confident in the fundamentals of the business, and the resilience of the luxury sector, and that the business sustains its longer-term growth and performance objectives.”
Harrods has bounced back after the pandemic forced the closure of its Knightsbridge store during lockdowns. The business is heavily dependent on spending by foreign visitors and the last curbs on travel by Chinese tourists were not lifted until the start of this year.
As with other major names in the luxury retail sector, Harrods has been critical of the last government’s scrapping of VAT-free shopping for overseas tourists in 2021. The group’s Managing Director, Michael Ward, has previously said that cities such as Paris have done “disproportionately well as a consequence of this”.
NAM Implications:
- Given that those that have, now have more…
- …then these results are not surprising.
- The issue remains of dilution following the government’s scrapping of VAT-free shopping for overseas tourists.
- Together with possible vulnerability due to political volatility overseas…
