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Harvey Nichols Sees Sales Dip, Losses Widen in Year Marred by Closures – WWD

LONDON – Sales fell and losses increased at Harvey Nichols in fiscal year 2021, but the company says it has enough funding and is ready to expand.

Group, which operates eight department stores in the United Kingdom and Ireland; six international units, and London restaurant OXO Tower, said on Monday that in the year ended March 27, 2021, its after-tax losses rose to £38.6 million from £15.5 million in the previous year.

For earnings before interest, tax, depreciation and amortization, the group recorded a loss of £28.1m, compared with a loss of £1.1m a year earlier.

The larger loss reflects continued closures, a “strong” drop in tourist arrivals and store closures that lasted nearly eight of the 12 months during the reporting period, according to accounts filed this week with company, the UK’s official business registry. .

Group revenue fell to £121.3m in the 2021 financial year, from £222.1m in the previous period.

The group notes that it has a “supporting owner” in the Hong Kong-based entrepreneur Dickson Poon, and well funded after securing £66m for the year. It received £26 million from its owners; £35m from a new five-year loan secured in June 2021 and has an overdraft facility of £5m, which Harvey Nichols said is currently unused.

Harvey Nichols

Harvey Nichols welcomed customers back on June 15, emphasizing social distancing.
WWD

Manju Malhotra, Harvey Nichols CEO, said that like most other retailers, the group was significantly impacted by the closures and the sharp drop in tourist arrivals due to travel restrictions. While online activity remains strong, she adds, it’s not enough to offset the impact of physical store closures and reduced downtown traffic.

“In these unprecedented times, we did not stand idly by and focused on managing costs and cash flow during store closures and investing in IT systems and websites to drive our online channel forward. ours. We have expanded the appeal of our portfolio and continue to look at innovative ways to maintain the outstanding service that our customers expect,” she said.

Malhotra noted that there is still “a high degree of uncertainty” about how the pandemic will unfold, “but in the meantime, we have continued to roll out exciting new initiatives in across the business to drive customer loyalty and a great shopping experience. While market conditions remain extremely challenging, we believe we have the right strategy in place to achieve our ambition to deliver sustainable profitable growth over the long term. ”

The company said that since fiscal 2022 began, it has continued to invest in its website and IT systems, as well as a new customer rewards program, which is expected to launch in late January 2022. , offering customers “benefits arranged” and refunds. . The program is intended to match the launch of a trading app in the new year.

The company said it has strengthened its relationships with Farfetch and Ocado in response to online demand during the pandemic and have “raised” its personal shopping offering, including launching a home wardrobe refresh service.

From a sustainability standpoint, the retailer worked with The Restory, a specialized repair service for luxury products, and Kids O’Clock, which resells children’s favorite children’s clothing. Stores are also welcome The cocoon to a store in London that offers a luxury handbag subscription service.

Harvey Nichols has expanded into children’s clothing, which is arguably the fastest growing in the industry. Parts, both in-store and online, have brands including Givenchy, Balmain and Chloe.

https://wwd.com/business-news/financial/harvey-nichols-sales-dip-losses-widen-year-marred-closures-1235023455/ Harvey Nichols Sees Sales Dip, Losses Widen in Year Marred by Closures – WWD

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