Harrods sales up by 9%, but no dividend for shareholders this year

SALES are up by 9% at London’s most famous luxury goods store despite the recession – yet its owner has decided to renege on any dividend.

Mohamed Al Fayed dismissed his decision not to take a dividend from Harrods as nothing more than sound shopkeeping in uncertain times.

“In the light of the economy and the market, it was just deemed sensible not to pay a dividend this year,” he said.

Mr Al Fayed has never been slow before in drawing down dividends, having banked £30 million (€35m) in 2008 and £48m in 2007.

Sales at the Knightsbridge store reached a record €752m last year.

It’s believed that the store has been helped by the weak pound with plenty of cash- rich customers, especially from the Middle East, taking shopping breaks in the British capital.

Fine jewellery was one of the best performing departments, with sales up 16% on previous years. Sales of handbags and shoes were up 15%.

Harrods is as famous for its interior’s gaudy excess as it is for its hefty price tags. – there’s the kitsch Egyptian room and the shrine to Al Fayed’s son, Dodi, who died in the infamous car crash with Princess Diana in 1997.

About 200 million people visit the store each year – with a quarter of these from overseas and 21% from regions outside London.

Between January and June this year, Chinese visitors spent 150% more in the West End of London than in the same period last year.

This summer, visitors from the Middle East are expected to spend £250m in London stores.