By Staff writer
Qatar-owned department store will reveal $1.76 billion of sales in annual results next week
Qatar-owned Harrods is to announce record sales and profits for the seventh year in a row next week, according to the Times newspaper.
The world famous department store, owned by Qatar Holding, will report £1.44 billion ($1.76 billion) of total sales in the year to January 30 2016 in its latest annual results to be filed at the UK’s Companies House next week.
The latest sales figures are up 4 percent from the previous year, said the Times, while pre-tax profits have risen from £141.5 million ($173.1 million) to £168 million ($205.5 million).
Operating profit is up 40 percent to £178.1 million (217.9 million) – and that is despite a heavy investment in capital expenditure, the newspaper said.
The accounts, seen in advance by the Times, also reveal that a dividend of £100.1 million ($122.4 million) has been paid to Qatar Holding, slightly down from £103 million in 2015.
Qatar Holding bought Harrods from Mohamed Al Fayed for a reported £1.5 billion ($1.8 billion) in 2010. Since then, the Qataris have pumped more than £400 million ($489.4 million) of capital investment into the store including building new boutiques and a footwear ‘emporium’, and installing 4G throughout the store.
John Edgar, chief financial officer at Harrods, said: “If you cast your mind way back to this time last year, the world’s luxury market was in a very different place.
“We had a currency which is almost opposite to where it is today and there had been some changes in China that impacted everybody adversely in the luxury market. So for us to grow our sales by 4 percent was a good result.”
Edgar also told the Times that Harrods’ Qatari owners were “like any other private equity-type owner”.
“This is not a trophy asset for them. All the capital investment that we have comes from this business. We give them money and any money we spend on capital expenditure we also generate ourselves. It all comes from the cashflow in the business.
“We don’t get a cheque from Qatar,” he said.
However, he said management may choose to give Qatar “more or less” in the future – “depending on what we decide we can do with the cash”.
The store has continued growing despite pressures on the luxury sector in recent years, attracting more than 15 million shoppers each year because of its wide range of goods and high quality customer experience, Edgar added.
The wider business includes an online retail division, airport concessions and a property business, but the Knightsbridge store “will always be the main show in town”, he said.For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.