Harrods delivered record sales and an uplift in pre-tax profits last year, despite Britain going through one of the worst recessions in living memory.
The iconic department store, whose flagship branch is in Knightsbridge, west London, attributed the buoyant performance to "sustained investment" and the introduction of new brands and boutiques. However, it will have also benefited from the weak pound, which led to a surge in the numbers of wealthy overseas shoppers visiting London. A spokeswoman for Harrods said: "Trading still remains solid in the first half of 2009."
Harrods said its pre-tax profits before exceptional items for the year to 31 January were £56.2m – an increase of 1 per cent from the £55.4m it achieved the year before, according to accounts filed at Companies House yesterday. During the year, the retailer, which also has shops at Heathrow and Gatwick airports, saw its sales rise by 9 per cent to a record £751.7m. The spokeswoman added: "Set against the tumultuous events of 2008 this is a very strong performance."
The figures from Harrods contrast with those of its Knightsbridge rival Harvey Nichols. Earlier this year, the trade magazine Retail Week reported that Harvey Nichols expected bottom line profits to fall by 40 per cent to £10m for the year to 31 March.
However, Harrods has been managing its costs carefully over the past 18 months. After paying a dividend of £50.8m in 2008, it did not pay one for the year to 31 January 2009. The retailer said: "With the very volatile economy and trading conditions, the group has continued to adopt a cautious approach to managing costs and to conserving liquidity."
Harrods' total pre-tax profit for the year was £50.3m, after exceptional items of £5.9m, which included work on its historic terracotta facade, onerous lease provision and the disposal of other fixed assets.