Selfridges reports narrowed losses despite sales slump

Selfridges Retail Limited reported a 7 percent decline in revenue for the 48 weeks ended January 4, 2025, reaching 774.6 million pounds, down from 834.9 million pounds in the previous 53-week period. The upmarket department store chain, which operates four stores in the UK, including its flagship on Oxford Street, and a digital business, attributed the sales slump to several external factors.

These included a reduced number of international visitors shopping in its UK stores, particularly due to the ongoing impact of the loss of tax-free shopping for international shoppers. Retailers have previously noted that this change makes the UK a less attractive destination for wealthy US and Asian tourists seeking luxury goods compared to European cities like Paris and Milan. Other economic conditions, such as inflation, high energy costs, and rising luxury brand prices, further contributed to the decline by undermining consumer confidence to spend on non-essential items.

Operating loss narrows despite revenue drop

Despite the fall in sales, Selfridges managed to narrow its statutory loss before income tax to 15.9 million pounds, a significant improvement from the 41.9 million pounds loss recorded in the prior year. This narrowing of losses, however, means the group has not made a pre-tax profit since 2019.

The company's operating profit actually increased to 42.2 million pounds from 27.7 million pounds in the comparative period. The directors explained that this was due to a strategic focus on more profitable sales, particularly from the digital retail business, combined with effective cost control.

For internal purposes, the Company assesses performance pre-IFRS 16 and reported a profit before income tax of 72.7 million pounds in the 48-week period, which was 16 million pounds higher than the previous year.

New shareholder and future outlook

The most recent results cover the period during which the ownership structure of the Selfridges Group changed. On September 16, 2024, the minority shareholder, SIGNA Retail GmbH, signed an agreement to transfer its stake to the Public Investment Fund ("PIF") of Saudi Arabia. Following the transaction's completion in December 2024, the PIF, Saudi Arabia's sovereign wealth fund, became the minority shareholder with a 40 percent stake in the indirect parent company, while Harng Central Department Store Limited ("Central Group") retained its majority shareholding and is considered the ultimate parent and controlling party.

Looking ahead, the company plans to drive future growth through continued investment in its four UK retail stores and digital channels, focused on the vision of knowing one million more customers, increasing annual customer visits by two per customer, and encouraging each customer to make one more sustainable choice.

Selfridges, which was founded by Harry Gordon Selfridge in 1909 and is known for its creative displays and status as a tourist attraction, is now gearing up for the crucial festive trading season. This year’s Christmas shop windows will feature a Disney theme as part of a tie-up with the entertainment company.