Sir Philip Green’s retail empire sees profits plunge 79% after BHS closure
Written by News on 08/06/2017
Profits at Sir Philip Green’s retail empire plummeted by 79% last year as it took a hit from the closure of BHS and a tough fashion market.
The company said competition from new fashion retailers and a squeeze on household budgets, with people cutting back on shopping for new clothes, contributed to the poor performance.
Accounts filed at Companies House for Taveta Investments – which owns Topshop, Miss Selfridge and Burton parent firm Arcadia – show pre-tax profits slumped from £172.2m to £36.8m in the year to 27 August 2016.
The figures include a £26.4m exceptional cost relating to BHS and other one-off charges relating to "onerous leases" on the group’s properties, Taveta said.
The BHS department store chain plunged into administration just over a year ago, triggering around 11,000 job losses and leaving 19,000 staff facing shortfalls in their retirement earnings.
In February, Sir Philip, agreed to pay £363m to settle the BHS pension scheme – significantly less than the £571m pension deficit the firm was left with when it went bust in April last year.
Speaking about the latest figures, Taveta said: "The retail industry continues to experience a period of major change as customers become ever more selective and value conscious and advances in technology open up more diverse, fast-changing and complex sales channels.
"Clothing has also become a less important part of the household budget."
The firm also pointed to Brexit for causing economic uncertainty and the collapse in the value of the pound following last year’s vote to leave the European Union.
"The group’s financial performance is below prior year levels including a significant additional charge on its trading results through the deterioration of currency exchange rates.
"The group is looking at initiatives to improve margin to offset the ongoing impact of weaker sterling."
Sir Philip has reportedly brought in management consultants McKinsey & Co to help with online sales.
(c) Sky News 2017: Sir Philip Green’s retail empire sees profits plunge 79% after BHS closure
