Kurt Geiger Says International Expansion, ‘Flourishing’ Handbag Sales Are Driving Strong Results
Amid speculation about a potential sale of Kurt Geiger, the company is touting strong financial results as it gears up to celebrate its 60th anniversary next month.
The UK-based footwear and accessories brand said net sales were up 31 percent to 329.5 million British pounds ($400.3 million based on current exchange) in the 12 months ended Jan. 18, 2023. Kurt Geiger also saw a 49 percent increase in EBITDA to 30 million pounds ($36.4 million) in the period.
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The company noted in its earnings report that growth is due to the brand’s international success, its “flourishing” handbag business and a commitment to philanthropy through the Kindness Foundation.
Kurt Geiger has been a fixture in the footwear industry since 1963, when it opened its first boutique on Bond Street in London. Fast forward to today, and the business now has over 80 standalone shops across the UK and over 2,000 employees. In addition to the namesake brand, it operates shoe departments in Harrods, Selfridge and Liberty.
Over the last year, Kurt Geiger has opened 12 new branded stores in the UK. And a new phase of expansion was heralded last month when the company opened a new 2,916-sq.-ft. store on London’s Oxford Street. At the time of the opening, the company said it marked the first step in a major retail rollout that will see it open nine stores in North America in the coming year.
This month, Kurt Geiger has opened three stores in Mexico with its local partner El Palacio de Hierro, and next year the brand will move across the border to the U.S., its largest market globally, where it plans to open six standalone stores.
As previously reported, Kurt Geiger is expected to open a 1,500-sq.-ft. store at Aventura Mall in Miami in April. This will be followed by a second standalone unit in Florida, three in southern California, and one in New York.
This plan comes as Kurt Geiger’s international expansion strategy seems to be working – leading to “significant increases” in both sales and brand recognition, the company noted in its earnings report. This can be seen in the company’s wholesale division, which reported net sales up 62 percent year-over-year to 70.1 million pounds ($85.2 million).
The company added that in the last four years it has become one of the fastest-growing accessories brand in department stores across the U.S. including Bloomingdale’s, Nordstrom, and Dillard’s. This year alone, U.S. online sales have experienced a 171 percent year-on-year growth, the company noted.
Kurt Geiger CEO Neil Clifford said in a statement that the company’s most recent financial results are “outstanding” and a “testament to the hard work, dedication, and innovation” of the entire Kurt Geiger family.
“I am extremely proud of the exceptional growth we have achieved internationally this year, especially in North America, as we are now recognized as a truly global accessible luxury accessories brand,” Clifford said. “We firmly believe in bricks and mortar as the cornerstone of our omnichannel retail offering and following successful store openings across the UK and now North America, we will continue to open more stores in the U.S. and across Europe in 2024.”
As for its handbag business, Kurt Geiger said it saw a 72 percent increase in net sales over the prior year to a record 91.6 million pounds ($111.3 million). The company noted that the category has been a “huge driver of growth” across all markets, especially in the U.S. where handbags are now its best-selling category, and in the UK where the category represents 50 percent of sales.
Looking at the company’s philanthropy arm, Kurt Geiger said it has successfully raised over 720,000 pounds ($875,000) through its Kindness Foundation to support a number of charity partners across both the UK and the US that support young people aged 13-25, providing practical career support and opportunities in creative industries.
To date, the Kindness Foundation has created over 150 mentoring opportunities and work placements, 90 hours of employee volunteering, and has reached 282,671 young people, the company noted.
Following a successful first year, the Kindness Foundation has created an innovative certified education program of its own, Business By Design, a learning initiative designed to serve young people aged 18-20, particularly those from underrepresented backgrounds, to give them the best possible chance to succeed.
“Since the Kindness Foundation began in 2022, our hope was that, beyond offering grants and supporting other incredible organizations, we could deliver something even more meaningful directly to young people,” Clifford added.
These latest results come weeks after reports earlier this month that the private equity parent company of Kurt Geiger, Cinven, is in talks with advisers at Bank of America to explore a possible auction of the brand.
According to reports, a sale process is expected to begin in the coming months, with interest anticipated from luxury goods groups and other buyout firms, Sky News reported earlier this week. Some reports have the deal valued at 400 million British pounds ($486 million based on current exchange rate).
Kurt Geiger was acquired by Cinven in 2015 as part of a deal that valued the company at $372 million. The company’s recent expansion was helped by a new $190 million funding package provided by Blazehill Capital and Wells Fargo Capital Finance UK to refinance its existing debt in June.
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