Selfridges Retail has recently disclosed its financial accounts for the fiscal year ending in January, showcasing impressive results. Responsible for managing its quartet of UK-based stores and its online webstore, the company has witnessed a significant surge in revenue during this period.
The revenue has surged to an impressive £843.7 million, marking an exceptional 29% increase compared to the previous year’s £653.4 million. Additionally, Selfridges has achieved an operating profit of £38.9 million over the course of 52 weeks, a substantial improvement from the £38.1 million operating loss recorded in the prior year. This remarkable financial performance can be attributed to robust foot traffic and sales in its brick-and-mortar stores, particularly spotlighting its flagship London store on Oxford Street and the Exchange Square branch in Manchester.
Despite these notable achievements, Selfridges reported a loss before tax of £37.9 million for the fiscal year. Nonetheless, this represents a significant improvement when compared to the previous year’s loss of £121.5 million. The net loss has also seen a substantial reduction, amounting to £38.3 million, marking a noteworthy improvement from the £83.9 million deficit recorded 12 months ago.
It is important to clarify that this loss primarily stems from the application of the accounting standard IFRS 16 ‘Leases.’ Selfridges’ «more significant leases» are still in the early phases of their terms, and as they progress towards completion, certain associated costs are expected to decrease. The application of IFRS 16 had a negative impact of £69.5 million this fiscal year, compared to £52.1 million in the previous year. It’s crucial to note that this had no impact on the company’s cash flows.
In terms of trading performance, Selfridges acknowledges that the persistent effects of the pandemic, particularly the Omicron variant peaking in January 2022, continued to influence its trade and turnover throughout the year. Furthermore, international Covid restrictions impeded the influx of foreign visitors to the UK in 2022, while supply chain disruptions, linked to both the pandemic and Brexit, presented additional challenges.
Nevertheless, Selfridges is clearly demonstrating resilience and substantial sales growth, rendering it an attractive investment for its new owners. In August 2022, the parent company at the time, Whittington Investments, divested its European retail businesses in the UK, Ireland, and the Netherlands to the Central/Signa joint venture.
Since then, Selfridges’ current ownership has remained steadfast in its commitment to the company’s vision of «reinventing retail» and championing sustainability. The company has actively participated in initiatives that have earned it recognition for its forward-thinking approach.
As we await the next annual report, it will be intriguing to observe the full impact of the new ownership on the company’s financial accounts, unless there are any unforeseen updates in the interim.
