Harvey Nichols blames earnings dive on Sars

Published on Tuesday 22 February 2005 13:24

UPMARKET department store group Harvey Nichols said its profits last year had been battered by the shrinking double effect the Iraq war and the Sars virus had on the global travel market.

However, the company, which is owned by Hong Kong-based entrepreneur Dickson Poon, expects business to pick up in the current year. In its latest annual accounts, the company, which has a major outlet in Edinburgh’s fledgling fashion district, Multrees Walk, said pre-tax profits in the 53 weeks to April 3, 2004 more than halved to about 2.4 million, from 5m the year before.

That was despite a slight increase in turnover to 76.1m from 74.2m previously, according to the latest annual accounts that have been filed with Companies House.

A spokeswoman for the group refused to comment on the latest figures. But in an accounts statement, Harvey Nichols’ directors said: "The company faced challenging trading conditions during the period due to the impact of the war in Iraq and Sars.

"Barring any unforeseen circumstances, the directors expect market conditions to gradually improve in the coming year."

The firm, which has its flagship store in London’s Knightsbridge, as well as others in Manchester, Birmingham and Leeds, said it had decided not to issue a dividend in 2004 after paying its shareholders 28.2p per share the previous year.

Harvey Nichols, which earned a place in popular folklore through the television series Absolutely Fabulous, was established in Knightsbridge in 1813 and the existing store was opened in the 1880s. In 1919, Debenhams bought the company and it became part of the Burton Group in 1985.

Then in 1991, Mr Poon’s Hong Kong-based company, Dickson Concepts (International), bought the group, eventually listing it on the London Stock Exchange in 1996. However, it was delisted and taken back into his private ownership in January 2003.

Plans are afoot to add overseas outlets in Hong Kong, Dubai and Dublin in the second half of this year.