Luxury department store Harrods saw strong growth in profits in the final year under Mohammed Al Fayed's management. Mr Fayed and his top directors – who resigned in May following the sale of the group to Qatar’s sovereign wealth fund– pointed to a customer loyalty scheme and refurbishments of the group’s Knightsbridge store as a few of the forces behind a 12 per cent rise in sales and 40 per cent surge in profit.
The £78m ($123m) in pre-tax profits reported for the year to January 31 are two-and-a- half times the £30m Harrods earned in 1985, when Mr Fayed outbid rival businessman Tiny Rowland for the group, prompting a political furore.
When Qatar Holding, a direct investment vehicle for the Gulf state, bought Harrods in May for £1.5bn, Ahmad al-Sayed, the fund’s chief executive, said the move was part of a strategy of adding “prestigious, top-performing businesses” to its portfolio at low points in the economic cycle.
Last year’s results show Qatar took on a group in the midst of a significant investment programme: Harrods put £35.6m into refurbishment of its Knightsbridge store, including the addition of two restaurants, and the opening of a shop and boutique in Heathrow’s Terminal 4.
The review also focused on possible overseas expansion, development of an online offering and extending the sale of Harrods-branded souvenirs for the mass market.