Stella McCartney: Fashion brand suffers sales slump amid huge loss
Sales at Stella McCartney’s fashion brand were slashed almost in half as its losses widened by £15m in the year before the designer bought out LVMH, it has been revealed.
Accounts filed almost six months after the Companies House deadline show Stella McCartney Ltd’s turnover was slashed from £40m to £21.9m in 2023.
The accounts also show its pre-tax loss went from £10m to £25m over the same period.
The designer’s company has not made a pre-tax profit since the £9m it reported in 2017.
Since then it has racked up a pre-tax loss of more than £143m.
Its accounts for 2024 are due to be filed with Companies House by the end of September this year.
Stella McCartney agrees LVMH deal
The results come after Stella McCartney bought back LVMH’s 49 per cent stake in her fashion brand, which the luxury giant had held for five years.
City PM reported in January that McCartney will continue to advise LVMH chief Bernard Arnault and the group’s executive team on sustainability issues as global ambassador on sustainability.
LVMH originally acquired the minority stake in 2019, one year after McCartney purchased Kering’s 50 per cent stake in her brand.
Kering and McCartney, who is the daughter of the Beatles’ Paul McCartney, had worked together for 17 years, with Gucci – now a division of Kering – helping to launch the brand in 2001.
LVMH is the largest luxury conglomerate in the world – it owns a huge variety of brands including Givenchy, Celine, Fendi and Dior, as well as champagne brands Dom Pérignon and Krug.
Fashion brand looks to boost sales
A statement signed off by the Stella McCartney Ltd board said: “In 2023 the company, as the entire market, has also faced significant pressure from inflation on materials and salaries, with adverse effects in particular on the cost of goods sold.
“This external factor has been mitigated by the review of selling prices and increase where relevant vs competition but has also being turned into an opportunity to further review ways of working, finding efficiencies, fighting waste, while remaining fair to partners and employees.
“While administrative and back office costs further decreased in 2023, investments were continued to sustain long-term growth, through key events to nourish visibility.”
Stella McCartney Ltd added: “In 2024 and beyond, the company will continue focusing their efforts in implementing product and communication strategy in order to nourish brand desirability and visibility and ultimately develop sales while right-sizing its operating cost base and optimising gross margin.”