Harrods swung to loss last year as turnover halved

Harrods swung to a loss last year and saw its turnover halve as the pandemic took its toll on the business.

In the year to January 30 2021, turnover at the iconic British department store chain fell 50.7 percent to 429.5 million pounds as store closures during government-imposed lockdowns led to a large reduction in sales activity.

Its gross transaction value including VAT fell 50.1 percent to 1.1 billion pounds during the year.

Harrods swings to full-year loss

The company posted a loss after tax of 57.3 million pounds compared to a profit of 191.4 million pounds a year earlier, while its operating loss came in at 66.4 million pounds compared to a profit of 203.3 million pounds in 2020.

Harrods said it saw a reduction in capital expenditure during the pandemic to 44.7 million pounds compared to 114.1 million pounds a year earlier.

As well as the uncertainty surrounding the pandemic, Harrods warned that Brexit could impact the business.

“It is anticipated that the predominant impact of Brexit on Harrods Limited revolves around the removal of the Retail Export Scheme that came into effect on January 1 2021,” the company said.

But it added that “it is not possible at this time to quantify the impact on future trade as a result of the loss of this benefit to overseas customers, given international travel has still not returned to pre-Covid levels”.

Describing its current position, the company said it had 60 million pounds in cash and 200 million pounds available in a committed undrawn revolving credit facility.