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Harvey Nichols results decline as luxury backdrop stays weak

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Harvey Nichols has filed its accounts for the year to March 2024 and they show that it was a tough year for the business, underlining the reasons behind its CEO change mid-year.

Photo: Sandra Halliday

When we say Harvey Nichols, it’s actually a variety of UK-registered companies that make up the luxury retail business. They include Broad Gain (UK) Limited, which operates the seven retail stores, one in Ireland, four international stores and the global webstore, as well as a standalone London restaurant. 

And the figures didn’t look good. Revenue for the 52 weeks fell to £204.87 million from £216.64 million. The gross margin also dipped to 44.1% from 45.4% with gross profit falling to £90.4 million from £98.4 million and the operating loss widening to £27.4 million from £15.4 million. It all meant that the loss after tax for the period jumped to £34 million from £21 million.

The company said that the 5% sales fall came at the same time as trade was impacted by weak consumer confidence as a result of the cost of living crisis and the highest interest rates in 15 years. The loss of tax-free shopping in the UK also continued to dent sales from tourists.

During the year it was undertaking a restructuring to reduce its costs, but this also resulted in one-off restructuring costs.

Harvey Nichols

The company had also been loss-making in the previous year but its loss last time was smaller than in the year before and its revenue managed to rise 13% as it said trade was beginning to return to pre-pandemic levels.

Looking also at the results for other individual companies that make up the overall business, it also filed for Harvey Nichols and Company Ltd, which is of particular interest because it operates the Knightsbridge, London, flagship store.

Its turnover fell to just over £78 million from £79.7 million and despite much smaller capital investment in the latest year, the loss after tax widened to £12.9 million from £4 million. As well as the aforementioned reasons for the parent company’s losses, the company also said that included in the number was an impairment of an intercompany debtor of £7.6 million in relation to a loan to Harvey Nichols (Beauty Bazaar) Limited. A decision was made to impaired the value of the loan as Beauty Bazaar has entered into an agreement with its landlord to surrender the lease on the Liverpool store. We reported last month that the company was planning to close that store.

The results for the business known as Harvey Nichols Group are less interesting as this is a holding company, but Harvey Nichols.com Limited is significant as its principal activity is running the webstore.

Again, turnover fell, this time to £48.8 million from £54.7 million and the company made an operating loss of £10.1 million, wider than the £6.3 million of the previous year. The company didn’t give any specific explanation for the 10.7% turnover drop although we assume that the reasons given above were relevant here as well.

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END. plans packed year of events for 20th anniversary

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END. promised it would be going big on its 20th anniversary celebrations and judging by the fashion retailer’s itinerary of events it’s actually huge.

With three events already under its belt in the January-March period, there are over 20 in the pipeline for the rest of the year involving a programme of curated events, pop-ups, activations, collaborations and partnerships “crafted hand-in-hand with brand partners who have journeyed with END. over the last 20 years”.

Participants include a host of big brands including A Bathing Ape, Adidas, Aries, CP Company, Crocs, Needles, Puma, Salomon, Stone Island, Umbro, Universal Works, Y-3, “and many more”.

It’s all in recognition of a brand that has grown from an independent in Newcastle to an international name with flagship locations in Newcastle, Glasgow, Manchester, London, and Milan, “defining its position as a trailblazer bridging the gap between luxury and streetwear, balancing exclusivity with accessibility with its signature curation of the world’s biggest brands to the most sought-after emerging labels all under one roof”.

The 20th anniversary will also honour the brand’s North East roots and the best of British subculture “focusing on narratives deeply connected to the retailer’s heritage, customers and cultural influences, touching on nostalgic themes from the coast to the corner shop and nightlife to the classic British pub”.

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Coats Group announces ‘strategic exit from US Yarns’

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Global threads manufacturing giant Coats Group is quitting its US Yarns business, resulting the closure of its Performance Materials (PM) facility based in Kings Mountain, North Carolina. 

It comes after a strategic review of the wider Americas yarns business that has already resulted in the closure of the Toluca, Mexico facility in December. The review, which started in Q4 2024, concludes that the Americas Yarns business doesn’t fit with Coats’ future strategy, noting the exit from this non-core operation “will result in a positive annualised impact to both the PM and Group adjusted EBIT margins”. 

The exit process is expected to complete in Q2 and Coats said it anticipates to generate a modest cash inflow, after closure costs, that will “allow management to focus on driving forward and growing other parts of the group’s attractive portfolio.

In 2024, revenues and EBIT for US Yarns was $68 million and $3 million, respectively.

Last month, Coats delivered a trading statement that highlighted “strong delivery, exciting medium-term targets with compounding cash and earnings growth”.

While the business reported a string of positives for the year ended 31 December (total revenues up 8% to $1.5 billion; apparel and footwear revenues up 13%; EBIT up 16%), it also noted that the PM business continued to drag across all North America end markets while there was also structural softness in North American Yarns.

The writing was perhaps on the wall for the future of its US PM ops in a statement that included that its Americas manufacturing footprint had been “right-sized” in Q4 with the closure of the Toluca site “to align to structural softness in North American Yarns [that will] drive immediate margin improvement”.

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Poland’s top fashion retailer LPP aims to double revenue by 2027

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Reuters

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April 3, 2025

Poland’s biggest fashion retailer aims to double its revenue to 40 billion zlotys ($10.56 billion) by 2027, driven by the rapid expansion of budget brand Sinsay and its omnichannel strategy, it said on Thursday.

Reuters

“In three years we assume the company will be twice as big,” CEO Marek Piechocki said during a press conference.

Under LPP‘s new three year strategy through 2027, Sinsay is set to account for 75% of the group’s total sales, it said.

The Gdansk-based retailer aims to expand its store network to around 7,500 outlets by the end of 2027, with Sinsay stores making up around 6,000 of those, and to increase e-commerce sales to 10 billion zlotys in the same period.

“As in previous years, the company intends to consistently pursue its policy of sharing the profit generated with its shareholders,” LPP said, indicating plans to maintain its dividend payouts.
The management recommended a dividend of 660 zlotys per share to be paid for the 2024 financial year.

The company also aims to double its core earnings (EBITDA) by 2027, compared to last year’s 3.67 billion zlotys, while keeping its debt levels safe, it said.

LPP’s revenue rose by 20% to 20.19 billion zlotys in 2024.

 

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