Victoria Beckham’s fashion label needs cash injection to survive after £5.9m loss

·2-min read
Victoria Beckham - Victor Boyko/Getty Images for Dior
Victoria Beckham - Victor Boyko/Getty Images for Dior

Victoria and David Beckham will have to pump more cash into her fashion label to keep it afloat after it lost almost £6m.

The Victoria Beckham label has now suffered nine years in the red since it was founded in 2008, newly filed accounts confirm.

Auditors for the fashion business – which makes clothes worn by the likes of Gwyneth Paltrow and the Duchess of Sussex – warned over the brand’s future for the third year running as it struggles to turn a profit.

BDO said the company was facing a "material uncertainty" that cast doubt on its ability to continue as a going concern.

A source close to the company said David and Victoria Beckham, who are both shareholders of the brand, were willing to support the company. Fellow investor Neo Investment Partners, a private equity company, is also understood to be supportive.

Directors wrote in accounts for Victoria Beckham Holdings: "Despite having no formal confirmation of this continued support, the directors have the reasonable expectation that any support will be provided from the shareholders".

Shareholders loaned the company £600,000 last year, according to accounts.

Losses at the former Spice Girls star's company came in at £5.9m in 2021, compared to £8.6m the year earlier.

The business returned to sales growth during the year, with revenues rising 14pc to £41m.

Directors said the results showed a significant improvement from a year earlier, when pandemic lockdowns held back sales in its wholesale business and at its flagship store in London.

Victoria Beckham chief executive Marie Leblanc said the company had been boosted by strong sales of beauty products.

He said: "We have entered a new chapter for the business and our energy is focused on accelerating growth and taking the brand to its full potential."

Separate company filings for DB Ventures, a vehicle that manages David Beckham’s sponsorship deals, show it paid its highest paid director a total of £2.1m last year. It is thought the highest paid director is Mr Beckham.

The disclosure comes after recent intense scrutiny of Mr Beckham's role as an ambassador for the Qatar World Cup. The former Manchester United footballer was criticised for taking money from the country given its poor human rights record and stance on LGBTQ+ rights.

The Qatar deal is not included in the latest figures, which cover 2021. They are expected to be included in the 2022 accounts.

The Beckhams received £6.3m in 2021 from a holding company that pays dividends to the couple, filings show. The awards equate to just over £17,000 a day between them.