Victoria Beckham halves losses as it cuts costs and boosts DTC sales
Losses at Victoria Beckham's fashion and beauty business have been halved as it moved to cut costs and boost its direct to consumer business, its latest accounts reveal.
Victoria Beckham Holdings reported a 2020 pre-tax loss to £8.7 million, down from £16.6 million in the previous year. However, the company's sales during the pandemic were impacted by store closures, which impacted its Mayfair flagship, resulting in a 6% decrease in group sales to £36.1 million.
The company credited this reduction in losses to improved management on spending in areas including fabrics, freight and IT contracts and acknowledged that Victoria Beckham Beauty helped its sales performance during this period. Beckham first launched her fashion label in 2008 and later founded Victoria Beckham Beauty in 2019.
As part of a restructuring of the business Beckham has merged her two fashion brands Victoria Beckham and Victoria, Victoria Beckham (VVB) with the aim of bringing overall pricing down.
During the period the business received £9.2m of loans in 2020 to settle a debt with HSBC and its accountant BDO said the business would require further funds from shareholders, who include David and Victoria Beckman, Neo Investment Partners and entertainment mogul Simon Fuller, to keep the business afloat. However it noted that while no formal arrangement had yet to be confirmed "the directors have the reasonable expectation that any support will be provided from the shareholders and have accordingly prepared the financial statement on a going concern basis".