Harvey Nichols' profits plunge

Upscale department store group Harvey Nichols on Friday became the latest victim of the luxury  downturn, saying it expects annual profits to plunge 40% to £10m ($14.6m) and sales to dip around 5%.

Joseph Wan, chief executive, said sales had gone into "free fall" since October.

"A lot of wealth has evaporated and cannot be replaced overnight," he told Retail Week magazine. "The total consumption pool has shrunk since last year. We must adapt," Wan added.

The group, which operates seven stores across the UK as well as Dublin, Riyadh, Istanbul and Dubai, said it is to refocus its efforts on better stock management and appealing to London-bound tourists keen to take advantage of the falling pound via a new marketing campaign launching this week, stated WGSN.

It said it had seen a "significant increase in spending by international shoppers contributing to stronger retail sales in London compared to elsewhere in the UK". In particular there was a big rise in "affluent Chinese" - who were up 84% since last year - and shoppers from Arab countries, Russia and Brazil.

Source: WGSN