Luxury jeweller Boodles has seen a resurgence in sales after a significant decline caused by the pandemic. However, the brand is worried about the impact of the latest Covid restrictions in Britain on its performance during the holiday season. Despite the difficulties, Boodles, which has been in business for 223 years and is family-owned, has managed to maintain profitability unlike many other companies that suffered losses during the first year of the pandemic.
In their recent financial accounts, Boodles reported a decrease in turnover from £74 million to £49.5 million compared to the previous year. Gross profit also dropped from £35.9 million to £23.9 million, and operating profit declined from £7.2 million to £5.3 million. Profit after tax narrowed from £5.2 million to £4.2 million. These declines in sales and profit can be attributed to the enforced closure of stores and the absence of social events where customers could wear Boodles’ products. The brand’s stores were shut for six months out of the year due to lockdowns, although some business was conducted remotely or at customers’ homes during this time.
Boodles recognized the significant decrease in administrative expenses last year and highlighted the £1.4 million savings resulting from the cancellation of business rates. The company also utilized the furlough scheme during the initial lockdown in 2020, although less frequently in subsequent lockdowns. Since the end of the reporting period and the easing of the final full lockdown in May, the business has seen a strong rebound in sales.
Alongside the challenges posed by the pandemic, Boodles has also prioritized its sustainability efforts over the past year. The company described this period as a “turning point” in its sustainability approach and became an early signatory to the Walpole Sustainability Manifesto in April 2020.
Boodles’ sales have been boosted by pent-up demand and travel restrictions, which have shifted sales towards domestic customers rather than international tourists. While transaction numbers have been steadily increasing, the brand is concerned about footfall in light of the new Omicron variant. With most of its stores situated in central London, any decrease in consumer activity in the capital could have a significant impact on Boodles’ performance. Reports have already indicated a drop in foot traffic in the financial district, where one of Boodles’ stores at the Royal Exchange operates. The brand also has other London locations, including Bond Street, Sloane Street, Harrods, and The Savoy hotel. Moreover, Boodles has stores in city centers outside of London, including Dublin, Leeds, Manchester, Liverpool, and Chester, which might also be affected by reduced foot traffic.
Michael Wainwright, managing director of Boodles, expressed hope that the company will not face any setbacks in the crucial weeks leading up to Christmas due to the newly implemented Covid restrictions. Ultimately, Boodles remains cautiously optimistic about its future performance, despite the potential challenges posed by the pandemic and changing consumer behavior.
Useful links:
– Report on luxury jeweller Boodles’ sustainability efforts: boodles.com/sustainability
– Information about Boodles store locations and products: boodles.com
