Theo Fennell sparkles

Listen to this article

00:00
00:00

Theo Fennell, jeweller to the celebrities, named former Burberry Group executive Pamela Harper as its new chief executive on Thursday as it experienced a 29 per cent rise in pre-tax profits driven by international sales.

The upmarket jeweller – whose customers include footballer David Beckham, his wife Victoria, singer Sir Elton John and actress Elizabeth Hurley – said international expansion following openings in Kazakhstan and Bahrain helped its results to sparkle.

Pre-tax profit rose from £336,226 to £434,286 in the six months to September 30, on sales up from £10.94m to £12.81m.

Focus will now be on the important Christmas period following recent indications that consumer confidence has reached its lowest level in four years, leading to a reluctance to splash out on big purchases.

Fennell is already showing signs that it is affected by nervous consumers. While second-half sales are still ahead of the previous year’s performance, the company said they are at more modest growth levels compared with the first half.

The group announced its intention to extend its international presence at its trading update in October and said it hoped the mini-concession in Kazakhstan would tap into the country’s burgeoning natural resources wealth. Pieces there have been selling for between £1,000 and £20,000.

Fennell already operates out of Moscow, Dublin, Dubai and the Maldives and many of its sales in London are to wealthy visitors from Russia, the Middle East and the US. Prices range from £100 for a simple key ring to £250,000 for some of its designer pieces.

Richard Northcott, chairman, said Ms Harper’s appointment was in line with the group’s strategy to establish a management team who will be able to take the company to the next stage of its international development.

“Ms Harper...was instrumental in the turnaround of the Burberry brand,” he said. “She joins us with a wealth of relevant experience and is the ideal person to develop Theo Fennell into a major luxury brand.”

Ms Harper has 28 years luxury goods experience, including nine years as a former executive at Burberry and as chief executive of Lambert Howarth. She replaces managing director Barbara Snoad who decided to stand down after six years in December to pursue new interests.

Andrew Wade, analyst at Seymour Pierce, said: “This is a real coup for the business - Pamela has an impressive CV, having played a major role in the turnaround at Burberry and with experience as MD at Escada UK and Hermes. We believe this appointment could mark a step-change in the establishment of Theo Fennell as an international marque.”

Fennell, whose shares are listed on London’s Aim junior market, held its first jewellery exhibition, Show Off, at London’s Royal Academy of Arts in September. A number of one-off items were designed for the show, together with new collections, which will now be distributed through the group’s international businesses.

Other new concessions for the group during the half year include a ”unique boutique” in the newly opened ”Room of Wonder” in Selfridges, London.

Mr Wade pointed out that the share price has fallen back from a peak of 164p in January to just 71p, representing a p/e ratio of just 11 times, falling to 9.5 times next year.

“We believe this is far too cheap for a developing luxury brand with plenty of scope for growth and see the current weakness as an excellent opportunity to pick up stock,” he said.

Earnings per share rose from 1.41p to 1.59p.

The shares rose 5p, or 6.8 per cent, to 78p in early trading.

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't copy articles from FT.com and redistribute by email or post to the web.