Harrods bounces again after pandemic hit as large spenders return to London | Harrods

Earnings at Harrods rose nearly 10-fold final yr as big-spending vacationers returned to London after the pandemic.

The Knightsbridge division retailer, which is owned by the funding arm of Qatar’s sovereign wealth fund, noticed earnings hit £171.6m and gross sales elevated 52% to £994m within the yr to January 2023, based on accounts filed at Firms Home.

Harrods Group (Holding), which additionally operates a division serving non-public jets and sells items to malls abroad, mentioned its restoration had come because it was in a position to open for the complete yr, after closing for 10 weeks due to pandemic lockdowns within the yr to January 2022.

The retailer mentioned it had “a robust restoration in commerce because the influence of the Covid-19 pandemic subsided and each native and abroad prospects returned”.

Tim Parker, the chief monetary officer at Harrods, mentioned final yr was one in every of “restoration and progress”.

“In the beginning of 2022, with many worldwide journey restrictions nonetheless in place, there was a subdued return of the worldwide tourism commerce that’s so necessary to the UK,” he mentioned.

Parker mentioned gross sales had been pushed partly by “ongoing funding in our bodily and digital property”.

The division retailer has fared nicely whereas rivals corresponding to Harvey Nichols, John Lewis, Fenwick and Home of Fraser have struggled, Debenhams has disappeared from the excessive road and Beales has only a handful of shops.

The retailer plans to introduce new womenswear and furnishings rooms and broaden its non-public buying service in 2023.

Its managing director, Michael Ward, was paid £2.3m, the identical as a yr earlier than, and the corporate took on nearly 400 additional workers, largely in gross sales and distribution, as commerce bounced again.

The group, which was purchased by Qatar Holding in 2010 for an estimated £1.5bn, didn’t pay out a dividend to its house owners for the third yr in a row because it repaid greater than £220m of loans and monetary leases.

A spokesperson for the retailer mentioned: “Harrods continued to outperform the broader market as a result of our longstanding relationships with each manufacturers and constant prospects, fuelled by a dedication to creating progressive and distinctive choices.

“We stay targeted on driving future progress through the curation of unique merchandise and experiences that may solely be present in Harrods.”

The retailer minimize about 700 jobs in 2020 when its magnificence companies and cafes had been pressured to remained closed amid social distancing measures.

It made a lack of £68m within the yr to January 2021, hit by restrictions linked to the Covid-19 outbreak, however returned to revenue in 2022 as restrictions eased.

The corporate mentioned that in December final yr it had prolonged a £500m borrowing facility for 5 years to 2027 and secured additional lending of as much as £200m for 3 years.