Victoria Beckham brand posts first operating profit, £7.3m, after 2008 launch
Revenue at Victoria Beckham Holdings rose 15 per cent to £129.8m and operating profit reached £7.3m, against an operating loss of £1.6m a year earlier. Accumulated losses before the turn exceeded £66m.
Victoria Beckham Holdings has reported an operating profit for the first time since the label launched in 2008.
Operating profit was £7.3 million in the year to the end of December, against an operating loss of £1.6 million the year before.
Pre-tax profit was £3.38 million, compared with a pre-tax loss of £4.85 million.
Revenue rose 15 per cent to £129.8 million. That is the fifth consecutive year of double-digit revenue growth.
The company said the improvement came from "disciplined cost control, stronger direct-to-consumer trading and an expanding international wholesale presence".
The scale of what preceded it matters more than the profit line. The business had accumulated more than £66 million of losses, funded in part by cash injections from David Beckham's personal fortune.
Accounts covering 2024 showed a £6.9 million injection from the Beckhams and the private equity firm Neo Investment Partners. Of that, £3 million went to working capital at the fashion label and £3.9 million to building inventory at Victoria Beckham Beauty.
Where the money had been going was set out last year in a Netflix documentary. It described a culture in which staff were reluctant to tell Beckham no, and overheads that ran unchecked.
David Belhassen, the investor who founded Neo, audited the business. The documentary's examples include £70,000 a year on office plants and a further £15,000 a year paid to an external contractor to water them. Beckham acknowledged indulgences from her entertainment career, including flying office chairs across the world.
The management structure changed as the cost base did. Sybille Darricarrère Lunel joined from Christian Dior Couture last July as chief executive of the fashion business, based in London.
Lauren Edelman was promoted from global chief marketing officer to chief executive of the beauty business last January, based in New York. Beauty launched in 2019 and is reported to generate about two-thirds of group revenue.
The result lands in a weak market. Burberry is cutting up to 1,700 jobs after a downturn pushed it to a £66 million pre-tax loss, while Charlotte Tilbury reported a £21 million pre-tax profit on sales of £539 million in its own year to the end of December.
For a founder building a premium brand, the arithmetic is the story. Seventeen years, more than £66 million of losses and outside private equity money went in before the first operating profit came out, and the thing that turned it was an audit of overheads rather than a bigger top line.
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