The retailer, known as "Harvey Nicks" to generations of fashion-conscious shoppers, currently operates its flagship store in London's Knightsbridge and a second outlet in Leeds.

Flagship London store

Another UK shop opens in Edinburgh in 2002 and the fourth, in Manchester, is due to be open the following year.

Harvey Nichols says it is taking 65,000 square feet of space in a building in the West Shambles area of the city.

It says it is also exploring the possibility of opening smaller stores in other British cities.

Overseas, it recently opened a shop in Riyadh, Saudi Arabia.

Results

Chief executive Joseph Wan said: "Harvey Nichols is delighted at the prospect of a store within the redevelopment of the city centre in Manchester.

"The development ... is an important part of the expansion of Harvey Nichols and will further confirm the company's reputation as the premier luxury goods retailer in the UK."

Publishing its results, Harvey Nichols said pre-tax profits to the 12 months ending 1 April were �14.7m, compared with �13.8m the previous year.

Turnover was �131.5m, up from �130.7m. Total dividend is 7.4 pence per share - up from 6.9p a year ago.

The firm said its sales maintained the same level as the previous year on a like-for-like basis, but in the first 10 weeks of the current year were up 3.1%.

Its upmarket London restaurant in the Oxo Tower saw growth of more than 10%, but the Prism restaurant, which opened in London in 1999, did less well, bearing some �200,000 in opening costs.