Matthew Williamson looks for a turnaround after accounts show a £1.6m pre-tax loss in 2012

Matthew Williamson, the fashion designer famous for his friendships with stars including Kate Moss and Sienna Miller, plans to restructure and grow his business this year, after it made £1.6m pre-tax loss in 2012.

The designer’s most recent accounts reveal that the costs of closing its New York shop and the termination of its MW diffusion line - after its partner went into insolvency - hit sales and profits.

The accounts, filed at Companies House this week, revealed that turnover had fallen 10 per cent to £10.2m, and that its pre-tax loss had widened from £142,477 in 2011 to a £1.6m.

But the brand is on the cusp of a turnaround after a new chief executive was drafted in last autumn. Former Nicole Farhi chief executive Niki Scordi has begun cost cutting at the brand to improve its balance sheet. Former chief executive and co-founder Joseph Velosa stepped up to chairman when Ms Scordi joined.

Mr Velosa, who owns a majority stake in the business with former partner Matthew Williamson, said: “2013 has been a year of increased profitability and we fully expect to turn in a clear profit margin for the business when we post our results in a few months from now.”

The company also said it is “encouraged by the group’s position after the recession and the improving market conditions” and added that without the exceptional items the 2012 earnings would have been £140,000.

Ms Scordi, who also previously worked at Browns and luxury giant LVMH, will expand the brand through wholesale accounts in department stores and boutiques globally. The group has stores in London’s Bruton Street and in the Middle East in Dubai and Doha. It also has an outlet store in Bicester Village in Oxfordshire.