The famous Knightsbridge store was snapped up by Qatar Holding, the investment arm of Qatar’s sovereign wealth fund, in 2010 for an estimated £1.5bn. The retailer’s parent group paid the dividend to a Qatari offshore company based in the tax haven of Bermuda. In 2013 the owners drew a dividend of £68.6m.
Operating profits at the store, which is heavily reliant on the wealthy tourists who flock to the capital, increased 13% to £122.9m on record sales of £794m in the year to 1 February. It also paid an internal royalty fee of £35.6m, according to the accounts for the Harrods Limited subsidiary.
At a pre-tax level profits were £140.4m, compared with £664.4m the previous year, a figure boosted by a £541m windfall from the sale of its trademarks.
The seven-storey store attracts more than 15m shoppers a year, and its new owners have not skimped on the investment required to keep them coming back. Some £60m was ploughed into refurbishments in 2013 with plans to invest the same amount in the new financial year.
This month Harrods opened a Salon de Parfum on its 6th floor which promises to stock the “most exclusive and innovative fragrances” for its wealthy clientele.
In recent years Harrods, which first opened its doors in 1849, has opened outlets in Gatwick’s South Terminal and Heathrow’s Terminal 5. Other interests include Air Harrods, which offers VIP helicopter charter, upmarket property arm Harrods Estates, and the exclusive Harrods Bank.
Qatar’s sovereign wealth fund, the Qatar Investment Authority, was founded in 2005 to help the Gulf state strengthen its economy by investing its oil and gas riches in other assets. It also owns stakes in Sainsbury’s, Barclays and Credit Suisse. Its 2010 takeover of Harrods brought to an end 25 years of ownership by controversial entrepreneur Mohamed al-Fayed.
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