Kurt Geiger profits rise as it feeds shoe 'addiction'
Monday 11 October 2010
Premium footwear retailer Kurt Geiger, which currently sells 10 pairs of shoes every minute, lifted underlying profits by a fifth in 2009, and expects to do even better this year.
The brand, sported by celebrities including Katy Perry and Claudia Winkleman, also revealed that women's clogs and shearling boots are the top sellers so far in 2010, and that shoppers in London spend on average £230 per designer shoe, compared to £180 for those outside the capital.
A rapid store opening programme and a trebling of internet sales helped Kurt Geiger to deliver turnover up by 17 per cent to £162m for the year to 30 January 2010, while like-for-like sales on stores open one year rose 8 per cent. Earnings before interest, tax, depreciation and amortisation (ebitda) rose by 21.2 per cent to £14.7m.
Neil Clifford, Kurt Geiger's chief executive, said: "These financial results demonstrate the continued success of our proven model for department store shoe retailing on an international level as well as our strategy to invest and expand in our own brand stores."
He also revealed that so far this year like-for-like sales and ebitda in the six months since the end of January are "growing ahead" of 2009.
Mr Clifford said: "In the face of a challenging economic backdrop, Kurt Geiger has performed very strongly and in 2010 we have expanded our headcount and rolled out new stores across the UK with more in the pipeline for the second half of 2010."
Kurt Geiger was sold to the private equity firm Graphite Capital in early 2008, in a deal reported to worth £95m.
The company is to open four new UK stores before Christmas in the City of London's One New Change shopping centre, Notting Hill, Manchester and Newcastle. It did not provide a pre-tax profit figure.
The brand opened 12 stand-alone stores last year, including in Dubai, bringing its total worldwide to 63, and is in discussions to expand into every major fashion market globally. Kurt Geiger has a total of 112 concessions. The retailer is also considering opening a further 40 UK stores over the next five years.
Kurt Geiger, which also sells men's shoes, has added a further 49 concessions in department stores, such as the recently launched "shoe boudoir" concept in Debenhams. In the process, the group created 275 new jobs.
While clogs and shearlings are currently leading the way, Kurt Geiger said there was still "ongoing demand" for high heels. The retailer said that each additional centimetre on the heel costs 20 per cent more, adding that in 2009 there had been record demand for 120mm platforms.
Rebecca Farrar Hockley, the buying and creative director of Kurt Geiger, waxed lyrical about how premium shoe retailers are the new "sweet shops" for women and that the average female has between 30 and 50 pairs of shoes.
She said: "There is no doubt that statement shoes are the latest addiction. Today's shoes transform how you look and feel with high heels giving women an instant lift. The best shoe retailers are to women today what sweet shops have always been to children."
She added: "Celebrity culture is playing its part and a popular personality wearing the best statement shoe in the media translates into immediate sales."
Over the year to 30 January, Kurt Geiger's online sales trebled. Of those, customers bought more than 10 per cent in the middle of the night.
The range of men's footwear remains modest, but the company said women purchase 56 per cent of men's shoes.
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