Harvey Nichols has reported a loss for its last financial year on flat sales due to a refurbishment program at its London flagship in Knightsbridge.

The Harvey Nichols loss reached £6.7 million before tax in the year to April 1, a significant turnaround from a  £3 million profit the previous year. Turnover was flat at £194 million.

But the company said its refurbishment program caused “considerable disruption” to trading with large parts of the ground floor closed to shoppers during reconstruction and restricted use of elevators, escalators and store entrances while the building works continued.  

CEO Stacey Cartwright described the year as “challenging” but assured shareholders the worst disruption due to the construction was now behind it.

Sales in the since reopened, refurbished areas have improved markedly, especially in the beauty category which was posting growth ahead of the overall market.  

From spring next year, the renovation focus will turn to the flagship’s first floor, which will be home to womenswear from international designers, shoes and contemporary collections.  

Harvey Nichols has seven stores in the UK and will next year open in Doha. It also operates a store in Hong Kong under a licensing agreement.