Michael Kors UK turnover declines amid store closures and e-commerce shift

London-based Michael Kors (UK) Limited has reported a decrease in turnover for the fiscal year ended March 29, 2025, as the luxury retailer pivots toward a leaner brick and mortar footprint and enhanced e-commerce operations.

The company, a subsidiary of the British Virgin Islands-incorporated Capri Holdings, saw turnover fall to 59.99 million pounds (80.03 million dollars), down from 70.85 million pounds in the previous year.

Strategic store closures and impairment charges

The decline in revenue is primarily attributed to the closure of several underperforming stores during the period. The company initiated the closure of three locations this fiscal year, with two additional closures planned for the following year. Specific sites set for permanent closure include Belfast, Glasgow, and London’s Old Bond Street.

These structural changes resulted in an impairment charge of 0.77 million pounds related to tangible assets, a significant increase from the zero charge recorded in 2024. Additionally, an impairment of 2.38 million pounds was recognized regarding the company’s investment in Michael Kors (Luxembourg) Retail Sarl.

Operating profit for the year decreased by 48 percent to 2.59 million pounds. Despite the dip in overall earnings, the gross profit margin improved to 38.65 percent from 32.55 percent. Management attributed this gain to supply chain optimization and business-wide savings.

Macroeconomic headwinds and future outlook

The directors noted that consumer demand was impacted by the increased cost of living and geopolitical tensions, specifically the ongoing conflicts in the Middle East and Ukraine. To counter these challenges, the brand plans to stabilize prices to remain competitive and meet shifting consumer demands.

The company successfully re-opened its flagship store on London’s Regent Street in September 2025 following a relocation. For the fiscal year 2026, the retailer expects sales to remain steady across both its retail and e-commerce channels.

Michael Kors UK operates as a limited risk distributor for the brand under an agreement with Switzerland-based Michael Kors (Switzerland) GmbH. Under this arrangement, commercial risks such as inventory and bad debt are borne by the Swiss entity, while the UK arm focuses on sales and marketing.