REG - Burberry Group PLC - Annual Financial Report <Origin Href="QuoteRef">BRBY.L</Origin> - Part 2
06/06/2017 10:00
- Part 2: For the preceding part double click ID:nRSF2724Ha
Recruitment is ongoing and talent review and succession
planningprogrammesareinplaceandareregularlyreviewed andupdated.
management. TheGroupwouldseektomitigateanyadverseimpactsonits
UK workforce arising from Brexit. The Group's BrexitSteering
Change in level ofrisk Strategiclink Committee will keep this underreview.
Amendedrisk All keystrategies
Sustained breachesof Trade marks and other intellectualproperty TheGroup'sglobalBrandProtectionteamisresponsiblefor
the Group'sintellectual ('IP') rights are fundamentally important tothe theGroup'sbrandprotectioneffortsglobally,includinginthe
property rightsand Group'sreputation,successandcompetitive digitalenvironment.Whereinfringementsareidentifiedtheseare
unauthorised saleof position. Unauthorised use of these,as addressedthroughamixtureofcriminalandcivillegalactionand
Burberryproducts. wellastheunauthorisedsaleofBurberry negotiatedsettlement.IPrightsaredrivenlargelybynationallaws
productsanddistributionofcounterfeit which afford varying degrees of protection andenforcement
products, damages the Burberrybrand priorities depending on thecountry.
image andprofits.
Change in level ofrisk Strategiclink
No materialchange Product Focus, Productive Space, E-Commerce
Leadership
Chineseconsumer Asignificantproportion oftheGroup's Theglobalreach ofthe Group helps to mitigate relianceon
spendingpatterns salesaretoChineseconsumersglobally. particular consumers. In addition, the Group continuesto
significantlychange Consequently,anychangetoChinese focus on engaging with the Chinese luxury consumer,both
adverselyimpacting consumer tastes or the economic,regulatory, inChinaandwhiletravellingabroad.
the Group'srevenues. social and/or political environment inChina
couldadverselyimpactthisconsumergroup's
disposable income, confidence andtravel,
which couldimpact the Group'srevenue
andprofits.
Change in level ofrisk Strategiclink
No materialchange Product Focus, Productive Space, E-Commerce
Leadership, OperationalExcellence
Volatility inforeign TheGroupoperatesonaglobalbasisand The Group seeks to hedge anticipated foreigncurrency
exchange ratescould earnsrevenues,incurscostsandmakes transactional cash flows using financial instruments. Theseare
have asignificant investments in a number ofcurrencies. mainlyintheGroup'scentralisedsupplychainandwholesale
impact on theGroup's TheGroup'sfinancialresultsarereportedin and Beauty businesses. The Group does not hedgeintra-group
reportedresults. Sterling. The majority of reportedrevenues foreign currency transactions at present. The Group monitorsthe
are earned in non-Sterling currencies,with desirabilityofhedgingthenetassetsofnon-Sterlingsubsidiaries
a significant proportion of costs inSterling. whentranslatedintoSterlingforreportingpurposes,butthe
Therefore,changesinexchangerateswhich Grouphasnotenteredintoanymaterialtransactionsforthis
aredrivenbyanumberoffactors,suchas purposeinthecurrentorpreviousyear.
global economic trends, Brexit orother
developments,canimpacttheGroup's
revenues, margins, profits and cashflows.
Change in level ofrisk Strategiclink
No materialchange All keystrategies
Major incidentssuchas natural catastrophes, global pandemics or terrorist attacks affecting one or more of the Group's key locations could significantly impact itsoperations. Change in level of risk Decreasedrisk A major incident at a key location could significantly impact business operations, with the impact clearly varying depending onthelocationanditsnature.Theimpactofthelossofadistributionhubwouldclearly differ from a global pandemic, but both wouldimpactrevenueandprofits. StrategiclinkAll keystrategies Business continuity plans are in place to mitigate operational risks, but cannot
ensure the uninterrupted operation of the business, particularly in the short term.
The regional spread oftheGroup'skeydistributionhubshelpstomitigatethisrisk.A Group
incident management framework is in place that addresses the reporting and management
of major incidents, and is tested each year using third-party specialists. Tailored
plans have been produced for a number of high-impact
events.Theseplansareregularlyreviewedandupdated.
The Group'soperations Failure to comply with theserequirements The Group monitors and seeks to continuouslyimprove
are subject to abroad couldleavetheGroupopentociviland/or its processes to gain assurance that its licensees,suppliers,
spectrum ofregulatory criminal legal challenge, significantpenalties franchisees,distributorsandagentscomplywiththeGroup's
requirements inthe and reputationaldamage. contractual terms and conditions, its ethical andbusiness
variousjurisdictions policies and relevantlegislation.
in which the Group operates. The pace of changeandthe consistency of application of legislation can vary significantly across these jurisdictions,particularly
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