Harrods returns to £84.9m profit after Al Fayed compensation payouts

Harrods has returned to profitability, reporting a pre-tax profit of £84.9 million for the year ending January 31, 2026. This follows a pre-tax loss of approximately £34 million to £36.5 million in the previous year, which was driven by difficult market conditions and £62.5 million in compensation payouts to victims of abuse by former owner Mohamed Al Fayed.

Turnover for the latest financial year rose by 1.2 per cent to approximately £1.1 billion. Despite a slight decrease in operating profit before exceptional items to £172.3 million, the company noted that the results demonstrate stabilization and modest growth. The retailer cited increased costs related to employee pay rises and higher employer national insurance contributions as factors impacting the bottom line.

The department store continues to invest in its Knightsbridge location, including the redevelopment of womenswear spaces and the renovation of The Georgian restaurant. Harrods remains cautiously optimistic, navigating a global slowdown in high-end retail spending through strong international tourism and high-net-worth customer loyalty.