Harrods returns to profit after compensation

Harrods, the historic London department store, reported a pre-tax profit of £84.9 million for the year ending January 31, rebounding from a £34.3 million loss the previous year. The prior loss was driven by tough trading conditions and £62.5 million in compensation payments to victims of former owner Mohamed Al-Fayed, who has been accused by hundreds of women of sexual abuse during his 25-year ownership. Harrods has paid compensation to over 100 victims, with more than 260 people engaging with its redress scheme. The company also faced two cyber attacks during the year, which it said had limited financial impact. Turnover rose 1.2% to £1.1 billion, supported by spending from international tourists and high-net-worth customers. Finance chief Geoff Weaver expressed cautious optimism despite global macroeconomic and geopolitical uncertainty. In the broader sector, rival Harvey Nichols warned it may need to cease trading within a year unless it secures fresh investment, with an auction process nearing conclusion and Frasers Group and Next reportedly vying to buy the brand.