Jam today as King’s grocer Fortnum moves back in black

FORTNUM & MASON has swung back to a profit for the first time since the pandemic as customers flocked to its Piccadilly shop despite the cost of living crisis.

The King’s grocer reported profits of £6.1m in the year to July 2022, up from a £2.7m loss the previous year. Turnover jumped 42pc to £187m.

The company said it had benefited from the return of customers to shops, with sales at its flagship site on Piccadilly up by around a third year-on-year.

Tom Athron, chief executive, said that while customer numbers had increased, people were spending less on average as the cost of living crisis prompted families to be more “judicial” with their money.

Shoppers spent less on the store’s iconic hampers, which cost up to £1,000, while sales of smaller items such as biscuits and jam grew sharply.

Mr Athron said it was “really good to see people rediscovering the joy of shopping”.

The department store, which was founded in 1707, has also enjoyed strong growth in its online business, which accounted for just under 40pc of total sales over the year and were nearly triple pre-pandemic levels.

Fortnum & Mason, which holds a Royal Warrant to supply groceries and tea to the Royal family, benefited from the Queen’s Platinum Jubilee celebrations last June, which provided a “buoyant” end to its financial year.

While Mr Athron warned of growing uncertainty over the economic outlook, he said that the company would benefit from the Coronation of King Charles III this year, with a special range of products due to be launched in March.

“I expect it’s going to be a coronation year rather than a coronation weekend,” he said.

Fortnum & Mason plans to open a new European hub to restart deliveries of luxury products to customers on the Continent.

The company was forced to end exports to the EU in March 2021 due to “onerous” paperwork that effected about half of its trade with the bloc. It is now working on a trial with Austrian catering business Trabitsch and plans to set up its own infrastructure this year.

Mr Athron said: “I think it’s an unintended consequence of Brexit, but the reality is I can’t sit here waiting for the Government to sort that out with the EU, we have to act sooner.”

Europe accounted for between 5pc and 10pc of Fortnum & Mason’s sales before Brexit.

Meanwhile, Mr Athron said Fortnum & Mason would also benefit from the easing of Covid-19 restrictions in China, allowing customers from the mainland to return to its store in Hong Kong.