º£½ÇÊÓƵ department store chain Selfridges has suffered losses exceeding £400m since its last pre-tax profit, according to recent revelations. The company, which operates º£½ÇÊÓƵ stores in London, Birmingham and Manchester, reached this milestone after reporting a £41.9m loss for the year ending 3 February, 2024.
This follows previous pre-tax losses of £39.3m, £121.5m and £217.2m. The last time the retailer reported a pre-tax profit was in the year ending 1 February, 2020, when it made £34m, as reported by .
The latest accounts filed with Companies House also reveal a drop in revenue from £843.7m to £834.9m in its most recent financial year. A statement approved by the board attributed the loss before tax to the application of the accounting standard IFRS 16 leases.
It explained that the main changes resulting from the adoption of IFRS 16 were an increase in depreciation and finance costs and a decrease in rental expenses. As the company's significant leases are at the beginning of their term, the increases in depreciation and finance costs significantly outweigh the corresponding reduction in rental expenses recognised in the statement of comprehensive income.
However, as the leases approach the end of their terms, these costs will reverse, with no overall impact on profit and loss over the life of the leases. The application of IFRS 16 does not affect the company's cash flows.
Recently published accounts have revealed that Selfridge's parent company, Cambridge Retail Group, recorded a pre-tax loss of £340.3m for the same financial year, a significant increase from the £126.2m loss reported in the previous 12 months. Despite this, the group saw its revenue jump from £804.7m to £1.5bn over the same period.
The Cambridge Retail Group portfolio includes not only Selfridges but also Shel Holdings Europe in the º£½ÇÊÓƵ, Brown Thomas Arnotts in Ireland and de Bijenkorf in the Netherlands.
In a statement, Selfridges expressed satisfaction with their performance: "We are pleased with our performance last year which saw a million more visits to our stores, reflecting how much customers enjoy spending time with us."
They added: "This year we are trading in line with expectations, footfall is up again, and we have seen a strong response to many of our investments, launches and activations including our newly renovated Oxford Street Beauty Hall and Sportopia, our huge celebration of sport over the summer."
The company also highlighted the opening of their largest ever Christmas shop and their excitement about delivering more extraordinary experiences for customers during the festive season with their More the Merrier campaign.
Earlier this year, City AM reported that Selfridges was planning to make around 70 redundancies at its London head office. The company explained that the decision was made in response to "market conditions and the evolving needs of our customers".
Earlier this month, it was also disclosed that Saudi Arabia's Public Investment Fund (PIF) had become a joint owner of the business behind Selfridges.
