Selfridges, despite experiencing a notable increase in sales, reported a significant rise in pre-tax losses.
- The company’s losses grew from £126m to £340m in a year, highlighting financial challenges.
- Sales, on the other hand, jumped by 95%, reaching £1.6bn, driven partly by increased borrowing costs.
- The parent company cut its workforce by 500 jobs, now employing around 7,300 people.
- UK filings revealed Selfridges’ losses widened to nearly £42m amid a drop in property values.
Despite a sharp rise in sales, Selfridges has faced a troubling financial year with its pre-tax losses more than doubling. The company’s latest annual results reveal a growth in pre-tax losses to £340 million for the year ending 3 February, up from £126 million the previous year.
Sales for the retailer, however, soared by 95% to reach £1.6 billion. This increase is partly attributed to a rise in the company’s finance bill, including interest payments on its borrowings. The financial challenges underscore the complexities involved in managing large-scale retail operations.
In response to the financial pressures, the parent company undertook significant cost-cutting measures, including reducing its workforce by 500 positions. It now employs approximately 7,300 workers across the group, which includes the Selfridges, Brown Thomas, and Arnotts brands in Ireland, along with De Bijenkorf in the Netherlands.
Separate UK filings showed that the department store chain’s losses had widened to almost £42 million during the period, an increase from the £39.3 million reported a year earlier. Despite these losses, the group expressed satisfaction with the performance, citing an increase in store visits by over a million in the past year.
Adding to the challenges, the property value of Selfridges has decreased by more than £600 million, with its flagship Oxford Street premises experiencing a significant reduction in valuation. Valuers cut £638.6 million from £3.1 billion in property assets, reflecting a 20.6% drop. This decline highlights the complex dynamics of retail property valuations in a fluctuating market.
Selfridges faces a challenging financial landscape as it balances soaring sales with increased losses and declining property values.
