Links of London suffered a net loss of more than £20m in 2017 as the business struggled to overcome challenging market conditions, its latest set of financial results have revealed.
Accounts for the 12 months to 31 December 2017, approved by the board of directors in March but only made public via Companies House this week, show that operating losses increased from £10.5m to £12.9m year-on-year.
Although the company managed to increase its gross margin from 58.3% to 59%, the addition of exceptional administrative expenses worth £7m meant that it ended the year reporting an overall loss of £20.6m, almost triple the £7m loss that it racked up the year before.
The deficit capped a disappointing year for the jewellery business after sales plunged by £6m year-on-year to £42.9m, with the company citing store closures and more challenging market conditions for the fall.
The 12% decline in turnover came as Links of London closed six doors as part of a real estate optimisation plan.
Just one standalone store was opened during the period – in Swindon – as well as a Folli Follie pop-up store in the Oxford Street branch of Selfridges.
However, five stores were given full refurbishments, including Westfield White City, Kingston-upon-Thames, Leeds, Gunwharf Quays and Ashford, according to the report.
In their review of the business, the directors said that investments had been made in new technology, including the relaunch of The Links of London website on a new platform.
Six separate collections were also launched during the year, while the company entered into a multi-year strategic partnership that saw it become an official licensee of jewellery to Ascot and Royal Ascot.
Looking ahead to future developments, the report stated that the company expects the commercial and economic environment to remain challenging, but it is confident that it has the brand strength, operational plan and parental support to deliver its agreed business plan.
It vowed to continue with store refurbishments and launch new product ranges, along with “extensive 360 degree marketing campaigns” to keep the brand at the forefront of customers’ minds.
Links of London has been approached to comment on the report.