Stella McCartney losses narrow as company reports 23% revenue uptick (2024)

By Lara Ewen

Dive Brief:

• Stella McCartney Ltd. reported revenue of 40.1 million pounds, or approximately $50.8 million at current exchange rates, for the 12 months ended Dec. 31, 2022, representing an increase of 23% over 2021, according to a Dec. 23, 2023, filing with Companies House in the U.K.
• The company’s loss before taxes for the period was 10 million pounds, compared to 2021’s 32.7 million pound loss. The company said in its current earnings report that this improvement confirmed its “trajectory towards break-even.”
• For 2023, the company said it anticipated that it, along with “the entire market”, would face significant “pressure from inflation on materials and salaries, with adverse effects in particular on the cost of goods sold.” To mitigate that, the company said it would review its selling prices and “increase where relevant vs competition” while also streamlining its “ways of working, finding efficiencies, fighting waste” and “remaining fair to partners and employees.”

Dive insight:

Over the past four years, circ*mstances have changed significantly at the privately-owned British luxury fashion house founded by musician Paul McCartney’s daughter in 2001.

In 2018, Stella McCartney acquired full control of her brand from Kering, and soon after, in 2019, LVMH announced a partnership intended to “to further develop the Stella McCartney House,” per a release posted at the time of the announcement. Building on that agreement, LVMH announced the launch of a Stella skincare line in 2022, and Bernard Arnault, chairman and chief executive of LVMH, was seated next to Paul McCartney at the Stella McCartney October 2022 runway show in Paris.

While the financial terms of the LVMH arrangement were never formally disclosed, LVMH has a 49% stake in Anin Star, the holding company for Stella McCartney Ltd., as well as a 49% stake in the Stella McCartney business. Meanwhile, McCartney is Anin Star’s majority shareholder, and continues to control her fashion line.

The newly ameliorated debt comes in large part from a March 2022 debt release approved by the directors of Anin Star Holding Limited. Loans and accrued interest in the amount of 98.1 million pounds “have been derecognised in exchange for the issuance of shares of the Company,” according to the earnings.

In addition to the debt reduction and its new skincare line, Stella McCartney Ltd. has also leaned into continuing partnerships with brands including Adidas and Yosimoto Nara. As a fully vegetarian brand, Stella McCartney also eschews leather and has worked with alternative fiber companies including Bolt Threads, which plans to go public via SPAC this year.

In November, WWD reported that Amandine Ohayon was named CEO, replacing Gabriele Maggio, who left after a 4-year tenure.

For 2023, the company said it anticipated that it, along with “the entire market”, would face significant “pressure from inflation on materials and salaries, with adverse effects in particular on the cost of goods sold.” To mitigate that, the company said it would review its selling prices and “increase where relevant vs competition” while also streamlining its “ways of working, finding efficiencies, fighting waste” and “remaining fair to partners and employees.”

The company’s loss before taxes for the period was 10 million pounds, compared to 2021’s 32.7 million pound loss. The company said in its current earnings report that this improvement confirmed its “trajectory towards break-even.”

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