Tory Burch, a well-known fashion brand, has recently announced a loss in its UK and German operations as a result of the ongoing pandemic. The company, which has a total of four stores in the UK and two in Germany, experienced an after-tax loss of £654,250 for the fiscal year ending in January. This sharp decline is in stark contrast to the small profit of nearly £42,000 that the company had managed to secure the year prior.
Despite the challenges faced, Tory Burch remains dedicated to the British and German markets with the support of its American parent company. The company reported a 3.32% rise in sales, reaching £24.9 million. However, the cost of sales also saw a notable increase, jumping from £7.9 million to £9 million, primarily due to currency exchange issues. The negative impact of currency fluctuations totaled £229,000 in the latest financial year, a significant difference from the positive impact of £45,000 the year before.
While the gross profit did experience a slight decrease to £15.9 million from £16.1 million in the previous year, the operating profit saw an uptick from £65,000 to £608,000. However, Tory Burch does not anticipate higher sales in the upcoming year as its operations continue to be impacted by the pandemic. The temporary closure of stores as a response to the health crisis has had a significant effect on the company’s performance in the first half of the year.
Tory Burch has established full-price stores in key locations in the UK, such as Regent Street, New Bond Street, Westfield London, and an outlet in Bicester Village. In Germany, the brand operates a full-price store in Munich and another location in Outletcity Metzingen. With downtown stores facing difficulties due to reduced tourist traffic and remote work arrangements for office employees, foot traffic to Tory Burch stores has notably dwindled.
As Tory Burch continues to navigate through another round of lockdowns, it is challenging to accurately determine the final impact on this year’s figures, especially with the impending conclusion of the Brexit transition period. Despite the hurdles encountered in the UK and German markets, Tory Burch remains steadfast and fully committed to its business operations in these regions. It is expected that the brand will adapt to the shifting retail landscape and emerge stronger from these unprecedented circumstances.
For more information on Tory Burch and its latest updates, visit the official website here: Tory Burch Official Website.
To read more about the impact of the pandemic on the fashion industry, check out this insightful article: Fashion Industry Impact of Coronavirus.
