British fashion giant Stella McCartney swings to £11m loss
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British fashion label Stella McCartney swung to an £11m pre-tax loss in 2018 as the fashion house’s costs skyrocketed.
Expenses incurred by the eponymous owner Stella McCartney’s decision to buy out luxury giant Kering’s 50 per cent stake in her company, along with flat-lining sales at £42.6m pushed the brand into the red.
The disappointing results come a year after the label recorded a profit of £9.1m.
Stella McCartney’s annual financial report identified a 67 per cent increase in administrative expenses from £29m in 2017 to £49m.
The company has said the decision taken by McCartney, the daughter of former Beatle Sir Paul McCartney, to become the sole owner of her brand, “marked the beginning of a two-year long transition process which will be completed in March 2020”.
McCartney co-founded her fashion label in 2001 alongside Kering, which owns luxury brands such as Gucci, Yves Saint Laurent and Balenciaga.
Having parted ways with the luxury goods conglomerate in March 2018, Stella McCartney signed a deal with one of Kering’s rivals LVMH in a move to “accelerate its worldwide development in terms of business and strategy,” according to a statement by LVMH.
McCartney, a committed vegetarian who does not use leather or fur in her designs, “will remain faithful to its long-lasting commitment to sustainable and ethical luxury fashion.”