Skip to main content
BoF Logo

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.

Harrods Bounces Back After Pandemic Hit as Big Spenders Return to London

Harrods | Source: Shutterstock
Profits at Harrods rose almost tenfold last year. (Shutterstock)

Profits at Harrods rose almost tenfold last year as big-spending tourists returned to London after the pandemic.

The Knightsbridge department store, which is owned by the investment arm of Qatar’s sovereign wealth fund, saw profits hit £171.6 million ($217.9 million) and sales increased 52 percent to £994 million in the year to January 2023, according to accounts filed at Companies House.

Harrods Group (Holding), which also operates a division serving private jets and sells goods to department stores overseas, said its recovery had come as it was able to open for the full year, after closing for 10 weeks because of pandemic lockdowns in the year to January 2022.

The retailer said it had “a strong recovery in trade as the impact of the Covid-19 pandemic subsided, and both local and overseas customers returned”.

ADVERTISEMENT

Tim Parker, the chief financial officer at Harrods, said last year was one of “recovery and growth”.

“At the beginning of 2022, with many international travel restrictions still in place, there was a subdued return of the global tourism trade that is so important to the UK,” he said.

Parker said sales had been driven partly by “ongoing investment in our physical and digital estate”.

The department store has fared well while rivals such as Harvey Nichols, John Lewis, Fenwick and House of Fraser have struggled, Debenhams has disappeared from the high street, and Beales has just a handful of stores.

The retailer plans to introduce new womenswear and furniture rooms and expand its private shopping service in 2023.

Its managing director, Michael Ward, was paid £2.3 million, the same as a year before, and the company took on almost 400 extra staff, mostly in sales and distribution, as trade bounced back.

The group, which was bought by Qatar Holding in 2010 for an estimated £1.5 billion, did not pay out a dividend to its owners for the third year in a row as it repaid more than £220 million of loans and financial leases.

A spokesperson for the retailer said: “Harrods continued to outperform the wider market due to our longstanding relationships with both brands and loyal customers, fuelled by a commitment to creating innovative and exceptional offerings.

ADVERTISEMENT

“We remain focused on driving future growth via the curation of exclusive products and experiences that can only be found in Harrods.”

The retailer cut about 700 jobs in 2020 when its beauty services and cafes were forced to remain closed amid social distancing measures.

It made a loss of £68 million in the year to January 2021, hit by restrictions linked to the Covid-19 outbreak, but returned to profit in 2022 as restrictions eased.

The company said that in December last year, it had extended a £500 million borrowing facility for five years to 2027 and secured further lending of up to £200 million for three years.

By Sarah Butler

Learn more:

Harrods to Open First Private China Club Catering to Ultra-Rich

Iconic London department store Harrods will open a new private members club in Shanghai, the first of its kind outside the UK, in a bid to tap resilient demand from ultra-wealthy Chinese amid a slowing recovery in consumption.

In This Article
Topics
Organisations

© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions

More from Retail
Analysis and advice from the front lines of the retail transformation.

Promising Signs for Macy’s Turnaround

Sales fell in the retailer’s first quarter, but were up at 50 stores where new ideas are being tested. CEO Tony Spring tells BoF he’s just getting started.


How Creative Direction at Pandora Is Evolving

Central to global jewellery brand Pandora’s growth strategy is a creative process that leverages customer behaviour and more sustainable innovation. BoF hears from creative directors Francesco Terzo and A. Filippo Ficarelli to understand their ambitions.


view more

Subscribe to the BoF Daily Digest

The essential daily round-up of fashion news, analysis, and breaking news alerts.

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.
CONNECT WITH US ON
The Business of Beauty Global Forum
© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions, Privacy Policy, Cookie Policy and Accessibility Statement.
The Business of Beauty Global Forum