REG - Frasers Group PLC - Final Results
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RNS Number : 3903R Frasers Group PLC 17 July 2025
17 July 2025
FRASERS GROUP PLC ("Frasers Group", "the Group", or "the Company")
Full year results for the 52 weeks ended 27 April 2025 ("FY25")
Building a broader platform for multi-year, sustainable profitable growth
Michael Murray, Chief Executive of Frasers Group:
"I'm pleased with our performance this year, despite the headwinds caused by
last year's Budget. We remain fully committed to our Elevation Strategy, which
drove another record year of profitable growth and further delivery of our key
priorities. We continued our strategy of confidently investing for the future,
unlocking multiple opportunities for sustainable medium- to long-term growth.
We accelerated our international expansion, announcing partnerships in
Australia, Asia and EMEA, to further build Sports Direct into a truly
worldwide proposition. Our relationships with the world's best global brands,
including Nike, adidas and HUGO BOSS, are the strongest they have ever been,
and our ambitious growth plans are now strengthening and scaling these
partnerships even further. We captured over £125m of synergies through
strategic acquisition integrations and cost-savings, and continued to invest
in real estate opportunities that deliver great value for the Group. Frasers
Plus is going from strength-to-strength and is on track to meet its long-term
ambitions. Delivering on all of these priorities demonstrates disciplined
execution business-wide, but there is still more important work to be done.
For FY26 so far, we are seeing positive momentum across the Group, including
strong performance at Sports Direct - and we have big ambitions to continue to
raise the bar. We are working hard to mitigate the £50m-plus of extra costs
caused by last year's Budget, and we are currently expecting FY26 APBT in the
range £550m-600m*. Looking further forward, we remain confident in our
strategy and our plans to deliver multi-year, sustainable profitable growth.
Thank you to our teams for their continued hard work and dedication."
* Excluding the results of XXL ASA which was acquired by the Group on 27 June
2025.
Headlines
· Continued strategic progress against key priorities:
1. Focus on underlying profitable growth
· APBT ((2)) of £560.2.m (+2.8%). Another year of record
profitable growth, with H2 APBT up 8.3%.
· Group and retail gross margin % up 150bps and 170bps year-on-year
respectively, driven by improved product and retail mix which is expected to
be sustainable.
· Delivered £127.2m of underlying cost-savings and synergy
benefits, largely from recent investments in warehouse automation and
acquisitions.
· Another period of sales growth in Sports Direct UK. UK Sports
profit from trading up £7.4m (1.6%) to £475.8m.
· Premium Lifestyle's profit from trading up £20.2m (14.7%) to
£157.4m, driven by integration and other cost benefits offsetting the
continuing challenges in the luxury market.
· Disposed of the non-core, low profit margin Game Spain business
for €25m.
2. Elevation Strategy, best brands and international expansion
· A breakthrough year for Sports Direct's international ambitions,
with new or extended strategic partnerships and acquisitions announced
worldwide, building a broader platform for global growth.
· Driving even stronger relationships with the biggest global
brands, including with strategic brand partners Nike, Adidas, HUGO BOSS. After
period end, Michael Murray was appointed to the HUGO BOSS supervisory board.
· Further UK property investments at attractive yields to satisfy
our occupational demand, with new shopping centres and retail park
acquisitions including Doncaster's Frenchgate, Exeter's Princesshay,
Maidstone's Fremlin Walk, and Affinity outlets.
· Continue to invest in UK luxury and premium retail, further
consolidating a market that is showing early signs of becoming less
challenging. Added 12 new stores and over 400k sq. ft, including FLANNELS
Leeds and FRASERS/Sports Direct Sheffield.
3. Acquisition integrations and automation synergies
· £127.2m of underlying cost savings and synergies offset the
planned reductions in low margin sales at Studio and Game, and the impact of
right-sizing JD Sports Fashion Premium Brands and SportMaster in Denmark.
· Increased warehouse efficiency, driven by automation and
rationalisation of our warehouse estate, enabled a £224.7m
(15.0%) reduction in gross inventory year-on-year, at the top end of our
5-15% target range (excluding the impact of the disposal of Game Spain).
4. Frasers Plus
· Good progress towards our long-term ambitions of delivering
£1bn+ in sales, £600m in credit balances, a greater than 15% yield, and over
2 million active Frasers Plus customers (excluding any third-party
partnerships). The business added 507k new customers in FY25 and Frasers Plus
accounted for 12.2% of UK online sales. Post year-end, the active customer
base has passed one million and penetration has increased to 18.9%.
· Strategic partnerships with THG, Hornby and Marks Electrical
continue to grow. Further partnerships with Super Payments and
eBuyer underway after period-end.
5. Strong balance sheet and cash flow
· The Group's strategy is underpinned by a strong balance sheet
with net assets increasing to £1,988.1m from £1,873.0m at FY24. Net assets
per share increased to £4.41, a three-year CAGR of 18.0%.
· Cash inflow from operating activities before working capital
movements of £800.4m has enabled the Group to continue to invest in
international sports, UK luxury retail, Frasers Plus, our property portfolio
and our strategic partnerships such as HUGO BOSS and Accent Group.
· Net debt excluding securitisation of £847.5m (£320.8m at FY24),
reflecting capital expenditure and strategic investments in FY25, particularly
Accent Group and HUGO BOSS.
· After period-end, we announced that we secured a new £3.0bn Term
Loan and Revolving Credit Facility, replacing the previous £1.65bn
arrangement, with options to extend the term up to five years and increase the
facility by £0.5bn. We wish to thank our banking partners for their
significant support of Frasers Group and our ongoing execution of the
Elevation Strategy.
Outlook
Following an especially weak period after last year's Budget, both UK consumer
confidence and trading conditions improved into 2025, and recent sales trends
have been more encouraging. For FY26, we are mindful of the various macro
headwinds and still expect to incur at least £50m of incremental costs as a
result of last year's Budget, but we are working hard to mitigate those by
taking more costs out, focussing on potential efficiencies through the use of
AI, realising further acquisition synergies, and sustaining a robust gross
margin. We will not compromise on our ambitious plans to build a broader
platform for long-term growth and remain fully committed to sustained
long-term investment in our successful Elevation Strategy and international
expansion. We are currently expecting FY26 APBT in the range £550m-£600m*.
Longer term, we remain excited by the potential across the Group, especially
for Sports Direct after our significant recent step up in international
expansion, and for Frasers Plus, and expect these to contribute to our
ambitious plans for developing and delivering multi-year, sustainable
profitable growth.
* Excluding the results of XXL ASA which was acquired by the Group on 27 June
2025.
FY25 FY24 ((1)) Change
Income statement summary
UK Sports Retail £2,698.1m £2,908.9m (7.2%)
Premium Lifestyle £1,048.2m £1,229.8m (14.8%)
International Retail £1,007.4m £994.6m 1.3%
Retail revenue £4,753.7m £5,133.3m (7.4%)
Property £86.6m £72.7m 19.1%
Financial Services £85.3m £111.0m (23.2%)
Group revenue £4,925.6m £5,317.0m (7.4%)
Retail gross margin 45.6% 43.9% +170 bps
Group gross margin 46.8% 45.3% +150 bps
Retail operating costs (£1,418.9m) (£1,521.1m) 6.7%
Retail profit from trading £747.3m £732.8m 2.0%
Other operating costs (£92.3m) (£73.6m) (25.4%)
Fair value adjustments to investment properties £13.1m £11.5m 13.9%
Gain on disposal of properties £0.6m £3.5m (82.9%)
Group profit from trading £808.9m £829.5m (2.5%)
Depreciation & amortisation (£275.4m) (£284.5m) 3.2%
Impairments net of impairment reversals £9.6m (£21.4m) 144.9%
Share-based payments (£0.8m) (£23.4m) 96.6%
Foreign exchange realised £14.7m £14.4m 2.1%
Operating profit £557.0m £514.6m 8.2%
Reported profit before tax ("PBT") from continuing operations £379.4m £501.0m (24.3%)
Result from discontinued operations £6.3m (£6.5m)
Fair value adjustment to derivative financial instruments £46.8m (£27.6m)
Fair value losses and loss on disposal of equity derivatives £141.6m £68.9m
Foreign exchange realised (£14.7m) (£14.4m)
Share-based payments £0.8m £23.4m
Adjusted profit before tax ("APBT") ((2)) £560.2m £544.8m 2.8%
Reported basic earnings per share ("EPS") 67.5p 86.8p (22.2%)
Adjusted basic EPS ((2)) 98.1p 95.8p 2.4%
Balance Sheet summary
Property, plant & equipment £1,097.2m £962.6m 14.0%
Investment property £513.3m £350.5m 46.5%
Long-term financial assets £959.1m £495.4m 93.6%
Inventories (net of provision) £1,128.3m £1,355.3m (16.7%)
Net assets £1,988.1m £1,873.0m 6.1%
Net assets per share £4.41 £4.16 6.1%
Cashflow & capital allocation
Cash inflow from operating activities before working capital £800.4m £834.6m (4.1%)
Net capital expenditure (£399.3m) (£211.3m) (89.0%)
Purchase of listed investments, net of disposal proceeds (£694.0m) (£249.3m) (178.4%)
Purchase of own shares - (£126.4m) 100.0%
Summary of financial performance
· APBT ((2)) increased by 2.8% to £560.2m despite the
non-recurrence of the £25.0m gain on disposal of the Missguided intellectual
property in FY24, an £11.8m loss on disposal of Game Spain, and a £40.1m
reduction in profit from trading in the Financial Services segment, due to our
decision to wind down the Studio Pay receivables portfolio and focus on
Frasers Plus, an approach which reduces revenue and increases impairment
charges in the near-term. A net reversal of property related impairments of
£9.6m has been recorded in the current period (FY24: £21.4m net impairment
including impairments of intangible assets) as a result of our future
forecasts outweighing our previous downside impairment assumptions.
· Reported PBT of £379.4m, a decrease of 24.3%. The Group's
trading performance has been offset by foreign exchange losses (vs. gains in
FY24) and non-cash fair value movements on equity derivatives, primarily
relating to the material decline in the HUGO BOSS share price. Both of these
non-cash adjustments were exacerbated by the market reaction to proposed
tariffs by the US government around the year-end date, impacts which, in the
case of equity markets, have largely reversed since year-end.
· Group:
· Retail revenue decreased by 7.4%. Continued sales growth from
Sports Direct, reflecting the ongoing success of the Elevation Strategy and
strengthening brand relationships, and the acquisition of Twinsport was more
than offset by planned declines in Game UK, Studio Retail, the companies
acquired from JD Sports and SportMaster in Denmark as these previously
unprofitable businesses were right-sized and put on a more sustainable
footing. In addition, the luxury market continued to be challenging although
it is now showing some early signs of improvement.
· Group gross margin % increased to 46.8% from 45.3% due to an
improved mix effect, as the lower margin % businesses reduce as a proportion
of total revenue and the higher margin Sports Direct and FLANNELS businesses
increased their share.
· UK Sports (54.7% of total group revenue):
· Revenue decreased by 7.2%. Continued sales growth from Sports
Direct reflecting the ongoing success of the Elevation Strategy and
strengthening brand relationships, was more than offset by planned declines in
Game UK and Studio Retail.
· Gross profit decreased by £50.8m as a result of the sales
decline but gross margin % increased by +180 bps to 48.2% reflecting the fact
that the higher margin Sports Direct business now makes up a greater
proportion of this segment.
· Operating costs reduced by £58.2m as the benefits of integrating
and right-sizing the lower margin businesses were realised. This contributed
to a £7.4m (1.6%) increase in the segment's profit from trading.
· Premium Lifestyle (21.3% of total group revenue):
· We continue to develop and invest in our unique luxury
proposition, including the recent opening of FLANNELS in Leeds and FRASERS in
Sheffield, and right-sizing the premium businesses such as House of Fraser and
JD Sports acquisitions. Our long-term ambitions for the luxury business remain
unchanged and we have taken this opportunity to consolidate in order to
further strengthen our position.
· Revenue decreased by 14.8% as we continued to optimise our store
portfolio in House of Fraser and in the businesses acquired from JD Sports,
reducing the number of stores from 44 at 28 April 2024 to 29 at 27 April 2025.
· Segment profit from trading increased by £20.2m as a £43.8m
decrease in gross profit, driven by the revenue decline noted above, was more
than offset by a 230bps increase in gross margin % from 37.1% to 39.4% (the
result of an improving mix effect with FLANNELS increasing its share) and a
£64.0m decrease in operating costs as the benefits of integrating and
right-sizing the premium businesses was realised.
· International Retail (20.5% of total group revenue):
· Revenue increased by 1.3% due to growth from the Sports Direct
International business and the acquisition of Twinsport, partially offset by
Sportmaster, which was integrated in FY24.
· Segment profit from trading decreased by £13.1m year-on-year.
Gross profit increased by £6.9m as a result of the revenue growth noted
above, whilst overhead costs increased by £20.0m due to inflationary
pressures and acquisition related costs.
· Working with our global brand partners, FY25 was a breakthrough
year for our international growth ambitions for Sports Direct, both deploying
our consistently strong cash flow and signing capital-light partnerships. We
extended our partnership with MAP Active and now plan 350 new stores, further
into Indonesia plus five new countries: India, the Philippines, Thailand,
Vietnam, and Cambodia. In Australia/New Zealand, we increased our investment
in Accent Group to 14.57% (and to 19.57% after year-end), and announced a
long-term strategic partnership which includes plans for at least 50 Sports
Direct stores in the first six years and a long-term objective of 100. We also
signed a new partnership with GMG, targeting 50 new Sports Direct stores in
the Gulf/Egypt over the next five years. In Africa, we announced the
acquisition of Holdsport in South Africa/Namibia (completed after year end),
and acquired a significant shareholding in Hudson, providing expansion
opportunities into Africa/Malta. In addition, we completed the acquisitions of
Twinsport in the Netherlands and, after year end, XXL in Scandinavia.
· Property (1.8% of total group revenue):
· Property investment remains a key focus for the Group, unlocking
occupational demand for our retail business whilst delivering strong returns
that can be recycled at the appropriate time.
· Revenue increased by £13.9m (19.1%), due to the annualisation of
prior year acquisitions such as the Castleford shopping centre and
acquisitions in FY25 including Doncaster's Frenchgate, Exeter's Princesshay,
Maidstone's Fremlin Walk, and Affinity outlets.
· Segment profit from trading increased by £5.0m, with the
additional rental income being partially offset by an £5.8m increase in
operating costs (including purchase related costs).
· Financial Services (1.7% of total group revenue):
· We see a great opportunity for Frasers Plus as a new revenue
stream and a key pillar of our compelling brand ecosystem.
· Frasers Plus continues to make good progress towards our
long-term ambition of delivering £1bn+ in sales, £600m in credit balances, a
greater than 15% yield, and over 2 million active Frasers Plus customers
(excluding any third-party partnerships). The business added 507k new
customers in FY25 and Frasers Plus accounted for 12.2% of UK online sales.
Post year-end, the active customer base has passed one million and penetration
has increased to 18.9%.
· We continue to prioritise the growth of our new Frasers Plus
credit offering and reduce the Studio Pay receivables book, which is now
closed to new customers, and as a result, revenue decreased by £25.7m (23.2%)
vs. FY24.
· Segment profit from trading decreased by £40.1m due to the
revenue decline noted above and an increase in overhead costs arising from the
dual running of Frasers Plus and Studio Pay. FY24 also benefited from an
£11.8m gain in respect of exiting a legacy property lease.
· Strategic partnerships with THG, Hornby and Marks Electrical
continue to grow. Further partnerships with Super Payments and
eBuyer underway after period-end.
· Basic EPS of 67.5p, a decrease of 19.3p (22.2%) year-on-year.
Adjusted EPS ((2)) of 98.1p, an increase of 2.3p (2.4%) reflecting the
increase in APBT ((2)) partially offset by an increase in effective tax rate.
· The Group's strategy is underpinned by a strong balance sheet
with net assets increasing to £1,988.1m from £1,873.0m at FY24 due to the
Group's profitability in FY25, partially offset by a decrease in the fair
value of the Group's strategic investments recognised in other comprehensive
income. Net assets per share increased to £4.41, a three-year CAGR of 18.0%.
· Cash inflow from operating activities before working capital
movements of £800.4m has enabled the Group to continue to invest in
international sports and leisure, UK luxury retail, Frasers Plus, our property
portfolio and our strategic partnerships such as HUGO BOSS and Accent Group.
· Net debt excluding securitisation of £847.5m (£320.8m at FY24),
reflecting capital expenditure and strategic investments in FY25, particularly
Accent Group and HUGO BOSS.
Acquisitions and investments
· During FY25, the Group has made further substantial strategic
investments, particularly in HUGO BOSS as the Group continues to explore
opportunities to expand commercial relationships and further develop the
Group's ecosystem.
· After period end, the Group completed the acquisition of
Holdsport in South Africa/Namibia and XXL ASA in Scandinavia. We will continue
to collaborate with relevant stakeholders and share best practices, in line
with our international expansion strategy, but it is too early to say what the
financial impact will be given the significant challenges XXL has seen in
recent years.
· Group representative appointed to the Board of Mulberry plc
effective from 30 July 2025.
Other notes
(1) Restated to reflect the classification of the results of
Game Spain as a discontinued operation and the reclassification of delivery
income and costs associated with free-issue gift vouchers from selling,
distribution and administrative expenses to revenue. Please refer to note 1
of the financial information for further details.
(2) This is an Alternative Performance Measure, for which the
reconciliation to the equivalent GAAP measure is set out in note 3 to the
financial information. Adjusted EPS is discussed in note 9 to the financial
information.
Enquiries
Andrew Kasoulis
Investor Relations Director
E. andrew.kasoulis@frasers.group
T. 07826 532191
Kathleen Glover
Frasers Group PR
E. fgpr@frasers.group
T. 07878 771 800
Rosie Oddy
Brunswick Group, PR
Advisors
E. frasersgroup@brunswickgroup.com
T. 07557 804 512
Restatement of prior period financial information
As noted above, prior period results have been restated to reflect the
classification of the results of Game Spain as a discontinued operation and
the reclassification of delivery income and costs associated with free-issue
gift vouchers from selling, distribution and administrative expenses to
revenue. Restated information showing the results from H1 of FY25 and FY24 on
an equivalent basis is given in the tables below.
26 weeks ended 27 October 2024
UK Sports Premium lifestyle International Retail Property Financial Services Group
Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Revenue 1,409.4 486.0 515.8 2,411.2 38.0 45.7 2,494.9
Cost of sales (748.8) (308.1) (289.6) (1,346.5) (4.4) (12.6) (1,363.5)
Gross profit 660.6 177.9 226.2 1,064.7 33.6 33.1 1,131.4
Gross Margin % 46.9% 36.6% 43.9% 44.2% 88.4% 72.4% 45.3%
Operating costs (405.4) (121.6) (171.2) (698.2) (11.8) (20.2) (730.2)
Fair value adjustments to investment properties - - - - - - -
Gain/(loss) on disposal of properties - - - - 0.3 - 0.3
Profit from trading 255.2 56.3 55.0 366.5 22.1 12.9 401.5
Depreciation & amortisation (61.7) (15.2) (34.7) (111.6) (22.4) (0.7) (134.7)
Impairments net of impairment reversals 5.5 7.3 2.4 15.2 (0.7) - 14.5
Share-based payments (4.7) - - (4.7) - - (4.7)
Foreign exchange realised (4.4) (0.1) (4.4) (8.9) 0.1 - (8.8)
Operating profit/(loss) 189.9 48.3 18.3 256.5 (0.9) 12.2 267.8
Loss on sale of subsidiaries/discontinued operations (0.8)
Net investment costs (0.6)
Share of profit of associated undertakings 1.0
Net finance costs (59.2)
Profit before tax 208.2
Result from discontinued operation 3.3
Fair value adjustment to derivative financial instruments 10.2
Fair value losses on equity derivatives 64.0
Realised FX gain 8.8
Share-based payments 4.7
Adjusted profit before tax ("APBT") 299.2
26 weeks ended 29 October 2023
UK Sports Premium lifestyle International Retail Property Financial Services Group
Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Revenue 1,513.2 564.0 512.7 2,589.9 31.4 57.3 2,678.6
Cost of sales (825.7) (347.0) (282.2) (1,454.9) (4.2) (15.2) (1,474.3)
Gross profit 687.5 217.0 230.5 1,135.0 27.2 42.1 1,204.3
Gross Margin % 45.4% 38.5% 45.0% 43.8% 86.6% 73.5% 45.0%
Operating costs (440.9) (177.1) (153.2) (771.2) (17.7) (3.8) (792.7)
Fair value adjustments to investment properties - - - - - - -
Gain/(loss) on disposal of properties - - - - - - -
Profit from trading 246.6 39.9 77.3 363.8 9.5 38.3 411.6
Depreciation & amortisation (59.2) (19.0) (33.0) (111.2) (20.5) (0.8) (132.5)
Impairments net of impairment reversals 23.7 2.4 (4.2) 21.9 (16.0) - 5.9
Share-based payments (9.3) - - (9.3) - - (9.3)
Foreign exchange realised 24.9 (0.2) (4.6) 20.1 1.8 - 21.9
Operating profit/(loss) 226.7 23.1 35.5 285.3 (25.2) 37.5 297.6
Gain on sale of subsidiaries/discontinued operations 20.0
Net investment income 13.0
Share of profit of associated undertakings -
Net finance costs (20.9)
Profit before tax 309.7
Result from discontinued operation 0.5
Fair value adjustment to derivative financial instruments (15.7)
Fair value losses on equity derivatives 21.9
Realised FX gain (21.9)
Share-based payments 9.3
Adjusted profit before tax ("APBT") 303.8
CHIEF EXECUTIVE'S REPORT AND BUSINESS REVIEW
Delivering on our priorities
FY25 marked another record year of profitable growth and continued investment
in Frasers Group's Elevation Strategy. We set six key priorities for the year,
and I'm proud to share that we have delivered against each of these, thanks to
our team's laser focus and commitment. While we've made meaningful strides, we
remain sharply focused on the opportunities for growth ahead and are motivated
to turn this momentum into sustained long-term success.
1- Unlock international opportunity
FY25 marked a step-change in global expansion. We've grown our footprint this
year, announcing seven strategic partnerships and acquisitions that reach an
additional 55 countries. With plans to open hundreds of new stores in the
coming years, this strategic execution has created a strong platform for
future growth and scaling.
2- Brand partnerships
Strategic brand partnerships are the strongest they've ever been across sport,
premium, and luxury, including with Nike, Adidas and HUGO BOSS - where I was
recently appointed to the Supervisory Board. Our position as a key partner for
the world's best brands was further reinforced, operating as a global
wholesale partner and continuing to diversify our offering with new brands
like Casablanca and Fear of God at FLANNELS. Through our international
partnerships, we have unlocked widespread distribution opportunities for
brands as demonstrated through Hudson / Nike in Africa and Accent / Hoka in
Australia. We also now act as valued landlords for brand partners across our
UK property portfolio, offering direct-to-consumer access and retail
synergies.
3- Synergies & cost savings
We unlocked meaningful synergies and cost-savings through ongoing integration
and operational alignment, generating £127.2m in efficiencies. This is a
significant achievement, driven by a focused effort to streamline operations
while also ensuring we do not undo the strong progress established by the
Elevation Strategy.
4- Reduce stockholding by 5%-15%
We delivered a like-for-like stockholding reduction of 15.0%, reflecting the
top end of our target range. This was driven by a focus on inventory
discipline and our state-of-the-art automated facility, which will further
support cash generation and a more agile operating model going forward.
5- Value creation via property acquisitions
We further strengthened our property portfolio through the acquisition of 12
strategic assets for a total consideration of £233.1m, continuing to drive
long-term value creation and flexibility across the Group.
6- Frasers Plus Growth
Our FCA-regulated credit and loyalty programme, Frasers Plus, has continued to
perform well this year, with over 1 million active customers now on the
platform and digital penetration increasing to 12.2%, reflecting the growing
strength of our financial services proposition.
Retail
Retail is the foundation of our business as we continue to drive our ambition
to build the world's most compelling and admired brand ecosystem across sport,
premium, and luxury.
Sport
FY25 has been another strong year for sport retail, led by Sports Direct. We
continued to enhance our Sports Direct UK store portfolio, with new stores in
Manchester's Trafford Palazzo and Westfield London shopping centres. We also
strengthened customers' omnichannel shopping experience, with the launch of an
all-new Sports Direct app and Sports Direct Membership - a new benefit-based
programme designed to reward loyal customers with exclusive benefits and
personalised offers. Since launching in February, the inaugural programme has
seen strong uptake among Sports Direct customers, who are enjoying a more
seamless omnichannel shopping experience. We also rolled out ten localised
Sports Direct websites in Europe, offering more personalisation to customers
in those markets. We continued to invest in our Own Brand portfolio, including
iconic brands like Slazenger, Everlast and Karrimor, which complement our
global brand partners and offer customers further variety in technical and
lifestyle apparel at accessible pricing. Our Everlast Gyms proposition also
continued to grow, with over 60 locations across the UK, as we aim to provide
aspirational training environments nationwide at an accessible price.
International expansion of Sports Direct has been a real area of focus for the
Group, offering promising scalability for the future through strategic global
partnerships.
· We expanded our partnership with MAP Active with plans to open
350 new stores in Indonesia plus five new countries: India, the Philippines,
Thailand, Vietnam, and Cambodia.
· We increased our shareholding in Accent Group and announced a
long-term strategic partnership which includes plans for at least 50 Sports
Direct stores in the first six years, with the ambitious goal of 100 stores
long-term in Australasia. We also now hold a board seat.
· We entered a 10-year agreement with global well-being and retail
conglomerate GMG - Nike's distributor in the region - to open around 50 Sports
Direct stores across the Gulf and Egypt.
· We acquired South African/Namibian sporting and outdoor retailer,
Holdsport, and acquired a significant shareholding in Hudson to serve as a
platform for further expansion across Africa. Both businesses also offer brand
distribution capabilities and partner with global brands such as Nike. We
also now hold a board seat with Hudson.
· After period-end, we acquired struggling Nordic-based retailer
XXL - the largest specialist sporting goods provider in the region. It is too
early to establish the size of this opportunity and its financial outlook. We
will provide a further update on its progress later in the financial year.
Beyond sports retail, our international momentum also lays the groundwork for
further potential expansion across our premium and luxury portfolio.
Premium & luxury
The global premium and luxury landscape remains subdued but is showing early
signs of becoming less challenging. Our FLANNELS estate has been successfully
elevated, with over 80 stores across the UK and Ireland. This year saw the
highly anticipated opening of the impressive 70,000 sq. ft. FLANNELS store in
Leeds, as well as innovative FRASERS Concept stores in Sheffield, and
Maidstone. We strengthened the digital experience for luxury consumers with a
new and improved FLANNELS app, and plan to extend Membership across both
FLANNELS and FRASERS in the next year.
Digital
Further leveraging the unique breadth and depth of Frasers Group's scale, we
entered the world of retail media after year-end with the launch of ELEVATE.
Currently in its infancy but with aspirations to offer the UK's most
comprehensive retail media offering, the new proposition connects brands more
effectively with the Group's 30m+ audience - bolstered by increasingly
personalised data from Sports Direct Membership. We believe this proposition
will be crucial in offsetting the ever-increasing digital marketing costs of
third parties.
Property
Property is a fundamental pillar of our business, and we remain confident in
our strategy of acquiring sites that unlock occupational demand for the Group,
as we continue to play a pivotal role in reinvigorating UK high streets and
retail hubs.
Over the past year, we have made substantial investments in strategic retail
locations across the UK, including Doncaster's Frenchgate, Exeter's
Princesshay, Maidstone's Fremlin Walk, and four Affinity Outlet properties, as
well as a development site in Ansty, Warwickshire.
Frasers Group Financial Services
Frasers Plus, our FCA-regulated, market leading credit and loyalty proposition
has seen its second year of consistent growth. It recently reached the
milestone of 1 million active customers and has further diversified through
strategic partnerships with THG, Hornby and Marks Electrical, as well as
eBuyer and Super Payments after year-end. There is still work to be done, but
we're confident in the proposition's future and remain on track to achieve our
long-term ambitions as we expand its strategic partnerships and grow the
customer base.
Our teams
Our success starts with our people. From head office to the warehouse and the
shop floor, our people are the driving force behind everything we do, which is
why we're committed to recognising, rewarding and motivating top talent across
the business. Thank you to our teams for their continued hard work and
dedication.
Going forward
Looking to the future, we are actively exploring the long-term role of
artificial intelligence across our business, starting with Frasers Plus. We
have an ambition to be among the first retailers to adopt a comprehensive AI
strategy on this scale and are seeking expert advice through our partnership
with Iona Star. Through this, we aim to unlock new sources of value, drive
cost optimisation and strengthen employee and customer experiences across the
Group. We will share further updates at our half year results in December.
After period-end, we announced that we secured a new £3.0bn Term Loan and
Revolving Credit Facility, replacing the previous £1.65bn arrangement, with
options to extend the term up to five years and increase the facility by
£0.5bn. We wish to thank our banking partners for their significant support
of Frasers Group and our ongoing execution of the Elevation Strategy.
Outlook
We believe the disciplined execution of our Elevation Strategy will continue
to drive strong growth across the business. We will continue to invest in this
strategy, with a view to the future, while working diligently to mitigate the
£50m-plus extra costs incurred by last year's Budget. We are currently
expecting FY26 APBT in the range £550m-£600m.*
Looking to FY26, we've set ambitious priorities for ourselves as we continue
to invest in and realise the benefits of our successful Elevation Strategy:
1. Continue to invest for the medium to long-term across key areas of
our Elevation Strategy including store estate, digital innovation, strategic
acquisitions and more
2. Execute international partnerships and scale brand partners
3. Unlock AI to increase productivity & mitigate costs
4. Focus on property investment opportunities for value creation
5. Frasers Plus growth continues, unlocking value for customers
* Excluding the results of XXL ASA which was acquired by the Group on 27 June
2025.
Michael Murray
Chief Executive Officer
16 July 2025
PERFORMANCE OVERVIEW
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
((1))
Retail revenue £4,753.7m £5,133.3m
Total revenue £4,925.6m £5,317.0m
Retail gross profit £2,166.2m £2,253.9m
Group gross profit £2,306.4m £2,409.2m
Retail gross margin 45.6% 43.9%
Group gross margin 46.8% 45.3%
Retail profit from trading £747.3m £732.8m
Group profit from trading £808.9m £829.5m
Reported profit before tax ("PBT") from continuing operations £379.4m £501.0m
Adjusted profit before tax ("APBT") ((2)) £560.2m £544.8m
Reported basic earnings per share ("EPS") 67.5p 86.8p
Adjusted EPS ((2)) 98.1p 95.8p
Net assets £1,988.1m £1,873.0m
Cash inflow from operating activities before working capital £800.4m £834.6m
(1) Restated to reflect the classification of the results of
Game Spain as a discontinued operation and the reclassification of delivery
income and costs associated with free-issue gift vouchers from selling,
distribution and administrative expenses to revenue. Please refer to note 1
of the financial information for further details.
(2) This is an Alternative Performance Measure, for which the
reconciliation to the equivalent GAAP measure is set out in note 3 to the
financial information. Adjusted EPS is discussed in note 9 to the financial
information.
The Directors have adopted Alternative Performance Measures (APM's). APM's
should be considered in addition to UK-Adopted International Accounting
Standards ("UK IAS") measures. The Directors believe that Adjusted profit
before tax ("APBT") and Adjusted EPS provide further useful information for
shareholders on the underlying performance of the Group in addition to the
reported numbers and are consistent with how business performance is measured
internally. They are not recognised profit measures under UK IAS and may not
be directly comparable with "adjusted" or "alternative" profit measures used
by other companies.
Retail revenue decreased by 7.4%. Continued sales growth from Sports Direct,
reflecting the ongoing success of the Elevation Strategy and strengthening
brand relationships, and the acquisition of Twinsport was more than offset by
planned declines in Game UK, Studio Retail, the companies acquired from JD
Sports and SportMaster in Denmark as these previously unprofitable businesses
were right-sized and put on a more sustainable footing. In addition, the
luxury market continued to be challenging although it is now showing some
early signs of improvement.
Group gross margin % increased to 46.8% from 45.3% due to an improved mix
effect, as the lower margin % businesses reduce as a proportion of total
revenue and the higher margin Sports Direct and FLANNELS businesses increased
their share.
Retail gross profit declined by £87.7m (3.9%) as continued growth in Sports
Direct reflecting the continuing success of the Elevation Strategy and
strengthening brand relationships, was more than offset by expected declines
in Game UK and Studio Retail, store portfolio in optimisation House of Fraser
and in the businesses acquired from JD Sports, and a softer luxury market.
Retail overheads reduced by £102.2m as a result of cost savings and synergy
benefits in the UK business, partially offset by inflationary pressures and
acquisition related costs in the International segment, leading to a 2.0%
increase in retail profit from trading to £747.3m.
APBT ((2)) increased by 2.8% to £560.2m despite the non-recurrence of the
£25.0m gain on disposal of the Missguided intellectual property in FY24, an
£11.8m loss on disposal of Game Spain, and a £40.1m reduction in profit from
trading in the Financial Services segment, due to our decision to wind down
the Studio Pay receivables portfolio and focus on Frasers Plus, an approach
which reduces revenue and increases impairment charges in the near-term. A net
reversal of property related impairments of £9.6m has been recorded in the
current period (FY24: £21.4m net impairment including impairments of
intangible assets) as a result of our future forecasts outweighing our
previous downside impairment assumptions.
Reported PBT of £379.4m, a decrease of 24.3%. The Group's trading performance
has been offset by foreign exchange losses (vs. gains in FY24) and non-cash
fair value movements on equity derivatives, primarily relating to the material
decline in the HUGO BOSS share price. Both of these non-cash adjustments were
exacerbated by the market reaction to proposed tariffs by the US government
around the year-end date, impacts which, in the case of equity markets, have
largely reversed since year-end.
Basic EPS of 67.5p, a decrease of 19.3p (22.2%) year-on-year. Adjusted EPS
((2)) of 98.1p, an increase of 2.3p (2.4%) reflecting the increase in APBT
((2)) partially offset by an increase in effective tax rate.
The Group's strategy is underpinned by a strong balance sheet with net assets
increasing to £1,988.1m from £1,873.0m at FY24 due to the Group's
profitability in FY25, partially offset by a decrease in the fair value of the
Group's strategic investments recognised in other comprehensive income. Net
assets per share increased to £4.41, a three-year CAGR of 18.0%.
Cash inflow from operating activities before working capital movements of
£800.4m has enabled the Group to continue to invest in international sports
and leisure, UK luxury retail, Frasers Plus, our property portfolio and our
strategic partnerships such as HUGO BOSS and Accent Group.
REVIEW BY BUSINESS SEGMENT
UK SPORTS
This segment includes the results of the Group's core sports retail store
operations in the UK, plus all the Group's sports retail online business,
other UK-based sports retail and wholesale operations, GAME UK stores and
online operations, retail store operations in Northern Ireland, Frasers
Fitness, Studio Retail's sales and the Group's central operating functions
(including the Shirebrook campus).
UK Sports accounts for 54.7% (FY24 restated ((1)): 54.7%) of the Group's
revenue.
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024 ((1))
Revenue £2,698.1m £2,908.9m
Cost of sales (£1,398.5m) (£1,558.5m)
Gross profit £1,299.6m £1,350.4m
Gross margin % 48.2% 46.4%
Profit from trading £475.8m £468.4m
Operating profit £365.5m £353.1m
Store numbers 785 797
(1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue. Please refer to note 1 of the financial
information for further details
Revenue decreased by 7.2%. Continued sales growth from Sports Direct
reflecting the ongoing success of the Elevation Strategy and strengthening
brand relationships, was more than offset by planned declines in Game UK and
Studio Retail.
Gross profit decreased by £50.8m as a result of the sales decline but gross
margin % increased by +180 bps to 48.2% reflecting the fact that the higher
margin Sports Direct business now makes up a greater proportion of this
segment.
Operating costs reduced by £58.2m as the benefits of integrating and
right-sizing the lower margin businesses were realised. This contributed to a
£7.4m (1.6%) increase in the segment's profit from trading.
UK Sports' operating profit result of £365.5m (FY23: £353.1m) includes
impairment reversals of £5.0m (FY24: impairment reversals of £8.4m), a
result of the strong trading performance, and future forecasts outweighing our
downside impairment assumptions, and realised foreign exchange gains of
£19.8m (FY24: £9.2m).
Store numbers decreased from 797 to 785 mainly driven by the replacement of
standalone Game stores with Game concessions situated inside larger Sports
Direct stores and a reduction in standalone Evans Cycles' stores.
PREMIUM LIFESTYLE
This segment includes the results of the Group's premium and luxury retail
businesses FLANNELS, Cruise, Van Mildert, Jack Wills, House of Fraser &
Frasers, Gieves and Hawkes, and Sofa.com along with the related websites, the
businesses acquired from JD Sports, as well as the results from the I Saw it
First website and the Missguided website until the disposal of the Missguided
intellectual property in October 2023.
Premium Lifestyle accounts for 21.3% (FY24 restated ((1)): 23.1%) of the
Group's revenue.
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024 ((1))
Revenue £1,048.2m £1,229.8m
Cost of sales (£635.4m) (£773.2m)
Gross profit £412.8m £456.6m
Gross margin % 39.4% 37.1%
Profit from trading £157.4m £137.2m
Operating profit £131.9m £98.6m
Store numbers 156 181
(1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue. Please refer to note 1 of the financial
information for further details
Revenue decreased by 14.8% as we continued to optimise our store portfolio in
House of Fraser and in the businesses acquired from JD Sports, reducing the
number of stores from 44 at 28 April 2024 to 29 at 27 April 2025.
Segment profit from trading increased by £20.2m as a £43.8m decrease in
gross profit, driven by the revenue decline noted above, was more than offset
by a 230bps increase in gross margin % from 37.1% to 39.4% (the result of an
improving mix effect with FLANNELS increasing its share) and a £64.0m
decrease in operating costs as the benefits of integrating and right-sizing
the premium businesses was realised.
Premium Lifestyle's operating profit result of £131.9m (FY24: £98.6m)
includes impairment reversals of £1.8m (FY24: impairments of £2.5m)
reflecting early signs of improvement in the luxury market.
We continue to develop and invest in our unique luxury proposition, including
the recent opening of FLANNELS in Leeds and FRASERS in Sheffield, and
right-sizing the premium businesses such as House of Fraser and JD Sports
acquisitions. Our long-term ambitions for the luxury business remain unchanged
and we have taken this opportunity to consolidate in order to further
strengthen our position.
Store numbers decreased from 181 to 156 as we continued to optimise our store
portfolio in House of Fraser and in the businesses acquired from JD Sports.
INTERNATIONAL
This segment includes the results all of the Group's sports retail stores,
management and operating functions in Europe, Asia and the rest of the world,
including the Group's European Distribution Centres in Belgium and Austria,
Twinsport in the Netherlands, the Baltics & Asia e-commerce offerings, the
MySale business in Australia, and all non-UK based wholesale and licensing
activities (relating to brands such as Everlast and Slazenger).
International accounts for 20.5% (FY24 restated ((1)): 18.7%) of the Group's
revenue.
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024 ((1))
Revenue £1,007.4m £994.6m
Cost of sales (£553.6m) (£547.7m)
Gross profit £453.8m £446.9m
Gross margin % 45.0% 44.9%
Profit from trading £114.1m £127.2m
Operating profit £38.1m £38.1m
Store numbers 373 350*
(1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue. Please refer to note 1 of the financial
information for further details
*FY24 store numbers restated to remove Game Spain.
Revenue increased by 1.3% due to growth from the Sports Direct International
business and the acquisition of Twinsport, partially offset by Sportmaster,
which was integrated in FY24.
Segment profit from trading decreased by £13.1m year-on-year. Gross profit
increased by £6.9m as a result of the revenue growth noted above, whilst
overhead costs increased by £20.0m due to inflationary pressures and
acquisition related costs.
International's operating profit result of £38.1m (FY24((1)): £38.1m)
includes impairments of £1.8m (FY24: impairments of £12.5m) and realised
foreign exchange losses of £4.9m (FY24: gains of £0.3m).
Working with our global brand partners, FY25 was a breakthrough year for our
international growth ambitions for Sports Direct, both deploying our
consistently strong cash flow and signing capital-light partnerships. We
extended our partnership with MAP Active and now plan 350 new stores, further
into Indonesia plus five new countries: India, the Philippines, Thailand,
Vietnam, and Cambodia. In Australia/New Zealand, we increased our investment
in Accent Group to 14.57% (and to 19.57% after year-end) and announced a
long-term strategic partnership which includes plans for at least 50 Sports
Direct stores in the first six years and a long-term objective of 100. We also
signed a new partnership with GMG, targeting 50 new Sports Direct stores in
the Gulf/Egypt over the next five years. In Africa, we announced the
acquisition of Holdsport in South Africa/Namibia (completed after year end),
and acquired a significant shareholding in Hudson, providing expansion
opportunities into Africa/Malta. In addition, we completed the acquisitions of
Twinsport in the Netherlands and, after year end, XXL in Scandinavia.
Store numbers increased from 350 to 373 due to the acquisition of Twinsport
and continued growth in Sports Direct Malaysia.
PROPERTY
This segment includes the results from the Group's freehold property owning
and long leasehold holding property companies that generate third party rental
and other property related income (e.g., car parking, conference and events
income). The results of the Coventry Arena are reported in this segment. The
depreciation of freehold and long leasehold owner-occupied properties is also
reported in this segment.
Property accounts for 1.8% (FY24 restated ((1)): 1.4%) of the Group's revenue.
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024
Revenue £86.6m £72.7m
Cost of sales (£9.6m) (£7.8m)
Gross profit £77.0m £64.9m
Gross margin % 88.9% 89.3%
Profit from trading £44.1m £39.1m
Operating profit/(loss) £4.5m (£31.3m)
(1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue. Please refer to note 1 of the financial
information for further details
Revenue increased by £13.9m (19.1%), due to the annualisation of prior year
acquisitions such as the Castleford shopping centre and acquisitions in FY25
including Doncaster's Frenchgate, Exeter's Princesshay, Maidstone's Fremlin
Walk, and Affinity outlets.
Segment profit from trading increased by £5.0m, with the additional rental
income being partially offset by an £5.8m increase in operating costs
(including purchase related costs).
Property's operating profit of £4.5m (FY24: loss of £31.3m) includes a net
impairment reversal of £4.6m (FY24: impairments of £14.8m), fair value gains
on investment property £13.1m (FY24: fair value gain of £11.5m) and
depreciation of £44.2m (FY24: £60.2m).
Property investment remains a key focus for the Group, unlocking occupational
demand for our retail business whilst delivering strong returns that can be
recycled at the appropriate time.
FINANCIAL SERVICES
This segment includes the results of Frasers Group Financial Services. This
includes interest charged on amounts advanced to consumer credit customers,
along with the associated impairment and operating costs.
Financial Services accounts for 1.7% (FY24 restated ((1)): 2.1%) of the
Group's revenue.
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024
Revenue £85.3m £111.0m
Impairment losses on credit receivables (£22.1m) (£20.6m)
Gross profit £63.2m £90.4m
Gross margin % 74.1% 81.4%
Profit from trading £17.5m £57.6m
Operating profit £17.0m £56.1m
(1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue. Please refer to note 1 of the financial
information for further details
We see a great opportunity for Frasers Plus as a new revenue stream and a key
pillar of our compelling brand ecosystem.
Frasers Plus continues to make good progress towards our long-term ambition of
delivering £1bn+ in sales, £600m in credit balances, a greater than 15%
yield, and over 2 million active Frasers Plus customers (excluding any
third-party partnerships). The business added 507k new customers in FY25 and
Frasers Plus accounted for 12.2% of UK online sales. Post year-end, the active
customer base has passed one million and penetration has increased to 18.9%.
We continue to prioritise the growth of our new Frasers Plus credit offering
and reduce the Studio Pay receivables book, which is closed to new customers,
and as a result, revenue decreased by £25.7m (23.2%) vs. FY24.
Segment profit from trading decreased by £40.1m due to the revenue decline
noted above and an increase in overhead costs arising from the dual running of
Frasers Plus and Studio Pay. FY24 also benefited from an £11.8m gain in
respect of exiting a legacy property lease.
DISCONTINUED OPERATIONS
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024 ((1))
Profit/(loss) from discontinued operation (net of tax) £6.3m (£6.5m)
(1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue. Please refer to note 1 of the financial
information for further details
In the current period, the result from discontinued operations relates to
amounts received from the Matches administration in excess of those assumed at
FY24 year-end (a gain of £13.2m), Game Spain's trading profit for the period
prior to its disposal on 20 March 2025 (£4.9m) and a loss on disposal of Game
Spain of £11.8m.
The prior period result from discontinued operations reflects a trading loss
of £8.4m for the period during which Matches was a subsidiary of the Group
and £4.1m loss on disposal, reflecting the difference between the carrying
value of the net assets at the point the Group ceased to control Matches and
the recoveries expected from the administration. The prior period result also
includes a trading profit of £6.0m in respect of Game Spain.
FINANCIAL REVIEW
The consolidated financial statements for the 52 weeks ended 27 April 2025 are
presented in accordance with UK-adopted International Accounting Standards (UK
IAS).
SUMMARY OF RESULTS
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024 ((1))
Revenue £4,925.6m £5,317.0m
Reported profit before tax £379.4m £501.0m
Adjusted PBT ((2)) £560.2m £544.8m
Reported basic EPS 67.5p 86.8p
Adjusted EPS ((2)) 98.1p 95.8p
(1) Restated to reflect the classification of the results of
Game Spain as a discontinued operation and the reclassification of delivery
income and costs associated with free-issue gift vouchers from selling,
distribution and administrative expenses to revenue. Please refer to note 1
of the financial information for further details.
(2) This is an Alternative Performance Measure, for which the
reconciliation to the equivalent GAAP measure is set out in note 3 to the
financial information. Adjusted EPS is discussed in note 9 to the financial
information.
EARNINGS
Basic earnings per share (EPS) is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the financial period. Shares held in
Treasury and the Employee Benefit Trust are excluded from this figure.
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024
Reported EPS (Basic) 67.5p 86.8p
Adjusted EPS (Basic) ((1)) 98.1p 95.8p
Weighted average number of shares (actual) 432,929,122 438,504,703
(1) This is an Alternative Performance Measure. Adjusted EPS is discussed
in note 9 to the financial information.
Basic EPS of 67.5p, a decrease of 19.3p (22.2%) year-on-year. Adjusted EPS
((1)) of 98.1p, an increase of 2.3p (2.4%) reflecting the increase in APBT
((1)) partially offset by an increase in effective tax rate.
TAXATION
The effective tax rate on profit before tax (including discontinued
operations) in FY25 was 24.0% (FY24: 21.8%). The year-on-year increase is
primarily due to the prior year benefiting from the recognition of deferred
tax assets in respect of brought forward trading losses in a number of
subsidiary entities.
Total tax contribution
The Group has contributed approximately £530m (FY24: £500m) in taxes paid
and collected during the year. Taxes paid by the Group of approximately
£240m (FY24: £220m) are primarily business rates, corporation tax and
employer's national insurance contributions. Taxes collected by the Group of
approximately £290m (FY24: £280m) are primarily net VAT, PAYE and employee's
national insurance contributions.
The Group's Tax Strategy is published at:
https://frasers-cms.netlify.app//assets//files/financials/fy25-tax-strategy.pdf
(https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Ffrasers-cms.netlify.app%2Fassets%2Ffiles%2Ffinancials%2Ffy25-tax-strategy.pdf&data=05%7C02%7CSam.Jones%40frasers.group%7C00b5f32fe9b94a5b9d6208ddb3299515%7Cb4a8e931f8f44453b7dbc5f6476641f0%7C0%7C0%7C638863713399517347%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&sdata=Vfsl6ofCsvrXluFsMXOplLE9YyxVViUPb5OelTxhL4Y%3D&reserved=0)
Taxes paid by country
The Group generates 88.4% (FY24: 92.6%) of its profits in companies that are
resident in the UK and pays 83.2% (FY24: 88.3%) of its corporation tax
liabilities to HMRC in the UK.
On 11 July 2023, rules were enacted to ensure large multi-national groups pay
a minimum level of corporation tax in respect of all countries where they
operate (known as "Pillar 2"). These came effect for the Group from 1 May
2024. Based on the Group's current business and tax profile, the
implementation of Pillar 2 legislation will not have a material impact on the
Group's tax rate or tax payments. The estimated additional potential cost
based on under the known Pillar 2 principles is approximately £0.5m.
The Group has applied the temporary exemption under IAS 12 to recognising and
disclosing information about deferred tax assets and liabilities related to
top-up taxes.
Plastic Packaging Taxes
During FY25 the Group has paid approximately £0.1m (FY24: £0.1m) in respect
of the UK Plastic Packaging Tax.
FOREIGN EXCHANGE AND TREASURY
The Group reports its results in GBP but trades internationally and is
therefore exposed to currency fluctuations on currency cash flows in various
ways. These include purchasing inventory from overseas suppliers, making sales
in currencies other than GBP and holding overseas assets in other currencies.
The Board mitigates the cash flow risks associated with these fluctuations
with the careful use of currency hedging using forward contracts and other
derivative financial instruments.
The Group uses forward contracts that qualify for hedge accounting in two main
ways - to hedge highly probable EUR sales income and USD inventory purchases.
This introduces a level of certainty into the Group's planning and forecasting
process. Management has reviewed detailed forecasts and the growth assumptions
within them and is satisfied that the forecasts meet the criteria for being
highly probable forecast transactions.
At 27 April 2025, the Group had the following forward contracts and bought
options that qualified for hedge accounting under IFRS 9 Financial Instruments
("IFRS 9"), meaning that fluctuations in the value of the contracts before
maturity are recognised in the hedging reserve through other comprehensive
income. After maturity, the sales and purchases are then valued at the hedge
rate.
Currency Hedging against Currency value Timing Rates
USD / GBP USD Inventory Purchases USD 560m FY26 - FY27 1.26 - 1.36
EUR / GBP Euro sales EUR 240m FY28 0.95 - 0.98
The Group also uses currency options, swaps and spots for more flexibility
against cash flows that are less than highly probable and therefore do not
qualify for hedge accounting under IFRS 9. The fair value movements before
maturity are recognised in the income statement.
The Group has the following currency options and unhedged forwards:
Currency Expected use Currency value Timing Rates
USD / GBP USD inventory purchases Up to USD 967m FY25 - FY29 1.29 - 1.43
USD / GBP USD sales Up to USD 60m FY25 - FY26 1.24
EUR / GBP Euro sales Up to EUR 720m FY25 - FY27 1.14
EUR / GBP Euro costs Up to EUR 720m FY25 - FY27 1.27 - 1.41
AUD / GBP AUD income Up to AUD 240m FY26 2.01
ZAR / GBP ZAR costs Up to ZAR 2,000m FY26 23.5
The Group also holds short-term swaps for treasury management purposes:
Currency Expected use Currency value Timing Rates
EUR / GBP Cash flow management EUR 500m FY26 1.15 - 1.18
AUD / GBP Cash flow management AUD 35m FY26 2.08
The Group is proactive in managing its currency requirements. The treasury
team works closely with senior management to understand the Group's plans and
forecasts, they also discuss and understand appropriate financial products
with various financial institutions, including those within the Group's bank
financed facility. This information is then used to implement suitable
currency products to align with the Group's strategy.
Regular reviews of the hedging performance are performed by the treasury team
alongside senior management to ensure the continued appropriateness of the
currency hedging in place, and where suitable, either implementing additional
strategies and/or restructuring existing approaches in conjunction with our
financial institution partners.
Given the potential impact of commodity prices on raw material costs, the
Group may hedge certain input costs, including cotton, crude oil and
electricity.
DIVIDENDS & SHARE BUYBACKS
The Board has decided not to pay a final dividend in relation to FY25 (FY24:
£nil). The Board remains of the opinion that it is in the best interests of
the Group and its shareholders to preserve financial flexibility and
facilitate future investments and other growth opportunities. The payment of
dividends remains under review.
CAPITAL EXPENDITURE
During the period, gross capital expenditure (excluding IFRS 16) amounted to
£411.7m (FY24: £267.2m). This included £168.0m (FY24: £99.2m) in respect
of investment properties including shopping centres and retail park
acquisitions at Doncaster's Frenchgate, Exeter's Princesshay, Maidstone's
Fremlin Walk, and Affinity outlets.
STRATEGIC INVESTMENTS
The Group continues to hold various strategic investments as detailed in note
14 to the financial information. At each reporting date, management prepares
an assessment of whether or not the Group has significant influence over
investee entities based on the indicators specified in paragraph 6 of IAS 28
Investments in Associates and Joint Ventures ("IAS 28"). Details of this
assessment can be found in note 2 to the financial information. Where the
Group has significant influence, the Group accounts for its investment as an
Associate. For investments where the Group does not hold significant
influence, the Group makes the irrevocable election permitted by IFRS 9
Financial Instruments to recognise fair value movements on long term financial
assets (i.e., strategic investments) at fair value through other comprehensive
income (FVOCI) given these are not held for trading purposes. The election is
made on an instrument-by-instrument basis; only qualifying dividend income is
recognised in the income statement, changes in fair value are recognised
within OCI and never reclassified to profit and loss, even if the asset is
impaired, sold or otherwise derecognised.
In addition to the above, the Group also holds indirect strategic investments
within contracts for difference and options. The Group assesses the use of
sold put options in acquiring a strategic investment on a case-by-case basis.
Where an option market exists, the use of sold put options allows the Group to
build an indirect holding, whilst limiting and/or spreading the associated
cash outflows over time by using options with differing maturity dates. The
Group typically receives a premium for entering into sold put options, which
reduces the net price paid for the shares in the event that the options
exercise. This makes the use of sold put options an effective method of
potentially obtaining shares at a price that the Group considers represents a
reasonable value.
The fair values of options are recognised in derivative financial assets or
liabilities in the consolidated balance sheet, with the movement in fair value
recorded in the income statement. In respect of put and call options, there
are three distinct elements to fair value changes recorded within investment
income and expense:
1) Premiums received (disclosed within investment income) - these are
cash receipts and represent a realised profit for the Group irrespective of
whether the option exercises or not. Premiums are recognised on expiry of the
option to which they relate.
2) Fair value movements (disclosed within investment income or costs)
- these are unrealised gains and losses arising due to the remeasurement of
the derivative liabilities to fair value whilst the options are open.
3) Losses on disposal (disclosed within investment income) - these
represent realised losses being the difference between the market value of the
shares purchased upon the exercise of options and the cash consideration paid
to the relevant counterparty.
The Group disaggregates these three elements (which are all presented within
investment income and expense within the consolidated income statement) in
order to provide useful information to the users of the financial statements.
Both the premiums received and losses on disposal relate to options that have
expired. Our presentation enables the users of the financial statements to
ascertain the premium income that has been received in exchange for the Group
selling the right to a counterparty to sell shares to the Group at a set
price. The loss on disposal shows the users of the financial statements the
loss that has arisen as a result of purchasing shares at a premium to market
value. It is the Group's view that each of these line items is sufficiently
material to warrant disclosure of their nature and amount separately as
required by paragraph 97 IAS 1 Presentation of Financial Statements ("IAS 1").
The net fair value loss on equity derivatives in the current period was
£36.1m (FY24: net fair value gain of £7.2m).
The Frasers Group's strategic investment strategy is a key enabler in the
growth and success of the Group and is in the ordinary course of business.
ACQUISITIONS
The Group acquired a number of businesses during the period.
RELATED PARTIES
Relationship Between Frasers Group plc and Mike Ashley
Mike Ashley opened his first sports shop in 1982 and built the Frasers Group
into a multi-billion-pound retailer over the next forty years. The Group was
initially floated on the London Stock Exchange in 2007 and following continued
growth Mike stepped down as CEO in 2022. He also stepped down from the Board
of Directors later in 2022 and has no day-to-day involvement or responsibility
for the strategic direction of the Group or any Board matters.
However, given his extensive involvement in leading the business for over
forty years, the Board has an agreement with Mr Ashley, through his own
company MASH Holdings Limited, which provides for management to seek his
expertise in discrete areas where he has specific knowledge, for example in
warehousing, logistics or strategic relationships with the supply chain. He
does not receive any remuneration for providing this advice to management and
has no decision-making powers.
CASH FLOW AND NET DEBT
Net debt increased by £493.4m from £447.6m at 28 April 2024 to £941.0m at
27 April 2025, reflecting capital expenditure and strategic investments in
FY25, particularly Accent Group and Hugo Boss. Net debt includes £93.5m of
borrowings relating to the Frasers Group Financial Services Limited
securitisation facility (28 April 2024: £126.8m).
Net interest on bank loans and overdrafts increased to £81.0m (FY24: £51.4m)
largely due to increased usage of the Revolving Credit Facility ("RCF") in the
period.
Analysis of net debt:
27 April 2025 28 April 2024
Cash and cash equivalents £252.2m £358.6m
Borrowings (£1,193.2m) (£806.2m)
Net debt (£941.0m) (£447.6m)
Securitisation (disclosed within borrowings) (£93.5m) (£126.8m)
Net debt excluding securitisation (£847.5m) (£320.8m)
The Group recently completed the successful refinancing of its combined term
loan and RCF and now has access to total committed facilities of £3 billion
for a period of at least three years. The facility has two one-year extension
options.
The Group also extended the maturity of the Frasers Group Financial Services
Limited securitisation facility during FY25. The Group is able to make
drawings of up to £130m against eligible consumer credit receivables until
December 2026.
The Group continues to operate comfortably within its banking facilities and
covenants and the Board remains comfortable with the Group's available
headroom.
SUMMARY OF CASH FLOW
52 weeks ended 52 weeks ended
27 April 2025
28 April 2024
Operating cash inflow before changes in working capital £800.4m £834.6m
Decrease/(increase) in receivables £131.5m (£47.4m)
Decrease in inventories £203.4m £114.1m
Decrease in payables (£18.4m) (£42.6m)
Decrease in provisions (£33.2m) (£47.5m)
Cash inflows from operating activities £1,083.7m £811.2m
Income taxes paid (£140.3m) (£129.0m)
Net cash inflows from operating activities £943.4m £682.2m
Lease payments (£142.0m) (£162.8m)
Net finance costs paid (£66.0m) (£35.6m)
Net capital expenditure (including sale & leasebacks) (£386.4m) (£211.3m)
Net proceeds from acquisition and disposal of subsidiary undertakings and (£48.9m) (£35.9m)
associated undertakings
Net cashflows in relation to equity derivatives (£105.0m) £109.1m
Purchase of listed investments, net of disposal proceeds (£694.0m) (£249.3m)
Purchase of own shares - (£126.4m)
Other £5.5m (£0.8m)
Movement in net debt (£493.4m) (£30.8m)
SUMMARY OF CONSOLIDATED BALANCE SHEET
27 April 2025 28 April 2024
Property, plant & equipment £1,097.2m £962.6m
Investment properties £513.3m £350.5m
Long-term financial assets £959.1m £495.4m
Intangible assets £58.5m £42.2m
Inventories £1,128.3m £1,355.3m
Trade & other receivables £927.8m £674.9m
Trade & other payables (£663.8m) (£683.9m)
Provisions (£223.6m) (£259.0m)
Net debt (excluding securitisation borrowings) (£847.5m) (£320.8m)
Securitisation borrowings (£93.5m) (£126.8m)
Lease liabilities (£667.8m) (£646.3m)
Other (£199.9m) £28.9m
Net assets £1,988.1m £1,873.0m
The increase within property, plant and equipment from 28 April 2024 is
largely due to net additions partially offset by depreciation.
The increase to investment property since 28 April 2024 reflects additions
totalling approximately £172.6m at sites including Doncaster's Frenchgate,
Exeter's Princesshay, Maidstone's Fremlin Walk, and Affinity outlets, fair
value movements totalling £13.1m and the transfer of a number of properties
to property plant and equipment following a change in use during FY25.
Long-term financial assets have increased since 28 April 2024 due to the
business making significant investments in Hugo Boss and Accent Group in FY25.
The increase has been partially offset by £149.6m of fair value losses on
existing holdings (recognised through OCI).
The increase to intangible assets since 28 April 2024 reflects the recognition
of approximately £20.5m of goodwill in respect of the acquisition of
Twinsport in FY25, offset by amortisation charged in respect of other
intangible assets.
Gross inventory has reduced by £272.2m (17.6%) year-on-year. This reflects an
increased level of warehouse efficiency, driven by automation and
rationalisation of our warehouse estate, as well as the disposal of Game
Spain. Excluding the impact of the disposal of Game Spain, gross inventory has
reduced by £224.7m (15.0%).
Trade and other receivables includes £522.7m relating to deposits in respect
of derivative financial instruments (28 April 2024: £139.0m) and the Frasers
Group Financial Services consumer credit receivables portfolio with a carrying
value of £181.7m (28 April 2024: £206.2m). Deposits in respect of derivative
financial instruments are collateral to cover margin requirements for
derivative transactions held with counterparties. The collateral requirement
changes with the market (which is dependent on share price and volatility),
the financial institutions' assessment of the Group's creditworthiness and
further purchases / sales of underlying investments held. The balance has
increased from £139.0m at 28 April 2024 to £522.7m at 27 April as a result
of a combination of the factors above and an increase in the Group's open
option positions at 27 April 2025.
Trade and other payables are broadly flat year-on-year.
Provisions have reduced by £35.4m from £259.0m to £223.6m reflecting the
utilisation and partial release of property and legal and regulatory
provisions.
Included within other, the closing corporation tax creditor at 27 April 2025
is £52.0m (FY24: £94.4m) and net deferred tax assets of £97.5m (FY24:
£82.1m) have been recognised.
Chris Wootton
Chief Financial Officer
16 July 2025
KEY PERFORMANCE INDICATORS
The Board manages the Group's performance by reviewing a number of key
performance indicators (KPIs). The table below summarises the Group's KPIs.
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
((1))
Group revenue £4,925.6m £5,317.0m
Reported PBT £379.4m £501.0m
Adjusted PBT ((2)) £560.2m £544.8m
Cash inflow from operating activities before changes in working capital £800.4m £834.6m
Net assets £1,988.1m £1,873.0m
NON-FINANCIAL KPIs
Number of retail stores 1,314 1,328*
Workforce turnover 25.0% 31.0%
Electricity consumption on like for like stores improvement vs FY20 29.1% 24.8%
(1) Restated to reflect the classification of the results of
Game Spain as a discontinued operation and the reclassification of delivery
income and costs associated with free-issue gift vouchers from selling,
distribution and administrative expenses to revenue. Please refer to note 1
of the financial information for further details.
(2) This is an Alternative Performance Measure, for which the
reconciliation to the equivalent GAAP measure is set out in note 3 to the
financial information.
The Directors have adopted Alternative Performance Measures (APMs). APMs
should be considered in addition to UK-Adopted International Accounting
Standards ("UK IAS") measures. The Directors believe that Adjusted profit
before tax ("APBT") provides further useful information for shareholders on
the underlying performance of the Group in addition to the reported numbers,
and is consistent with how business performance is measured internally. They
are not recognised profit measures under UK IAS and may not be directly
comparable with 'adjusted' or 'alternative' profit measures used by other
companies.
APBT is profit before tax excluding the effects of exceptional items, realised
foreign exchange, fair value adjustments to derivative financial instruments
included within finance income/costs, fair value gains/losses and profit on
disposal of equity derivatives, and share schemes. For the avoidance of doubt,
premiums received in respect of options that have matured are included within
APBT. This measure has been reviewed by the Audit Committee which has
appropriately challenged management on the presentation and the adjusting
items included in this APM.
Group Revenue
The Board considers that this measurement is a key indicator of the Group's
growth.
Reported Profit Before Tax
Reported PBT shows both the Group's trading and operational efficiency, as
well as the effects on the Group of external factors as shown in the fair
value movements in strategic investments and FX.
Adjusted Profit Before Tax
APBT shows how well the Group is managing its ongoing trading performance and
controllable costs and therefore the overall performance of the Group.
Cash Inflow from Operating Activities Before Changes in Working Capital
Cash inflow from operating activities before working capital is considered an
important indicator for the Group of the cash generated and available for
investment in the Elevation strategy.
Net Assets
The Board considers that this measurement is a key indicator of the Group's
financial position and health.
Number of Retail Stores
The Board considers that this measure is an indicator of the Group's growth.
The Group's Elevation strategy is replacing older stores and often this can
result in the closure of two or three stores, to be replaced by one larger new
generation store. *The prior year figure has been restated to exclude Game
Spain stores in order to allow a like-for-like comparison.
Workforce Turnover
The Board considers that this measure is a key indicator of the contentment of
our people. For more details refer to the retention section of the 'Our
People' section of this report.
Like for Like electricity consumption
This measure links to our targets in the TCFD report around the installation
of LED lighting, building management services, and voltage optimisation. This
measure allows the board to determine the effectiveness of these projects in
reducing the Group's energy consumption. Like for like stores includes stores
in Great Britain, above a de minimis consumption, and that were open from 2019
onwards.
FINANCIAL INFORMATION
CONSOLIDATED INCOME STATEMENT
For the 52 weeks ended 27 April 2025
Total Total
52 weeks ended 27 April 2025 52 weeks ended 28 April 2024
(restated)((1))
Note
(£'m) (£'m)
CONTINUING OPERATIONS
Revenue 4,840.3 5,206.0
Credit account interest 85.3 111.0
Total revenue (including credit account interest) 3 4,925.6 5,317.0
Cost of sales (2,597.1) (2,887.2)
Impairment losses on credit customer receivables 15 (22.1) (20.6)
Gross profit 3 2,306.4 2,409.2
Selling, distribution and administrative expenses (1,788.3) (1,906.0)
Other operating income 15.6 10.9
Property related impairment reversals/(impairments) 11 9.6 (14.5)
Profit on sale of properties 0.6 3.5
Fair value adjustments to investment properties 12 13.1 11.5
Operating profit 3 557.0 514.6
Profit on sale of subsidiaries 10 4.3 25.0
Investment income 4 111.3 78.4
Investment costs 5 (141.6) (68.9)
Finance income 6 29.2 43.4
Finance costs 7 (182.8) (91.5)
Share of profit of associated undertakings 2.0 -
Profit before taxation 3 379.4 501.0
Taxation 8 (92.7) (107.9)
Profit after taxation from continuing operations 286.7 393.1
DISCONTINUED OPERATIONS
Profit/(loss) from discontinued operation, net of tax* 10 6.3 (6.5)
Profit for the period 293.0 386.6
ATTRIBUTABLE TO:
Equity holders of the Group 292.1 380.8
Non-controlling interests 0.9 5.8
Profit for the period 293.0 386.6
Pence per share Pence per share
Basic earnings per share - Continuing operations 9 66.0 88.3
Basic earnings per share - Discontinued operations 9 1.5 (1.5)
Basic earnings per share - Total 9 67.5 86.8
Diluted earnings per share - Continuing operations 9 66.0 88.3
Diluted earnings per share - Discontinued operations 9 1.5 (1.5)
Diluted earnings per share - Total 9 67.5 86.8
((1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue.) ( Please refer to note 1 for further
information.)
*The result from discontinued operations was wholly attributable to the equity
holders of the Group.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the 52 weeks ended 27 April 2025
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Profit for the period 293.0 386.6
OTHER COMPREHENSIVE (LOSS)/INCOME
ITEMS THAT WILL NOT BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS
Fair value movement on long-term financial assets (149.6) (43.7)
Remeasurements of defined benefit pension scheme 0.2 0.4
Fair value adjustment in respect of properties transferred to investment - 1.2
property
ITEMS THAT MAY BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS
Exchange differences on translation of foreign operations (0.6) (21.7)
Foreign exchange impact of disposal of discontinued operations (3.0) -
Fair value movement on hedged contracts - recognised in the period (9.0) 25.5
Fair value movement on hedged contracts - recognised time value of options - (0.7)
Fair value movement on hedged contracts - reclassified and reported in sales (12.3) (6.1)
Fair value movement on hedged contracts - reclassified and reported in 2.5 (8.1)
inventory/cost of sales
Fair value movement on hedged contracts - taxation taken to reserves 4.6 (2.9)
OTHER COMPREHENSIVE LOSS FOR THE PERIOD, NET OF TAX (167.2) (56.1)
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 125.8 330.5
Continuing operations 119.5 337.0
Discontinued operations 6.3 (6.5)
125.8 330.5
ATTRIBUTABLE TO:
Equity holders of the Group 124.9 324.7
Non-controlling interest 0.9 5.8
125.8 330.5
CONSOLIDATED BALANCE
SHEET
Company number: 06035106
As at 27 April 2025
Note 27 April 2025 28 April 2024
(£'m) (£'m)
ASSETS - NON CURRENT
Property, plant and equipment 11 1,097.2 962.6
Investment properties 12 513.3 350.5
Intangible assets 13 58.5 42.2
Long-term financial assets 14 959.1 495.4
Investment in associated undertakings 36.4 18.0
Retirement benefit surplus 0.1 0.6
Deferred tax assets 110.5 109.6
2,775.1 1,978.9
ASSETS - CURRENT
Inventories 1,128.3 1,355.3
Trade and other receivables 15 927.8 674.9
Derivative financial assets 47.3 87.2
Cash and cash equivalents 252.2 358.6
2,355.6 2,476.0
TOTAL ASSETS 5,130.7 4,454.9
LIABILITIES - NON CURRENT
Lease liabilities (558.2) (533.8)
Borrowings 16 (1,118.2) (806.2)
Retirement benefit obligations (1.9) (1.8)
Deferred tax liabilities (13.0) (27.5)
Provisions 17 (214.5) (247.8)
(1,905.8) (1,617.1)
LIABILITIES - CURRENT
Borrowings 16 (75.0) -
Derivative financial liabilities (327.3) (62.8)
Trade and other payables (663.8) (683.9)
Lease liabilities (109.6) (112.5)
Provisions 17 (9.1) (11.2)
Current tax liabilities (52.0) (94.4)
(1,236.8) (964.8)
TOTAL LIABILITIES (3,142.6) (2,581.9)
NET ASSETS 1,988.1 1,873.0
EQUITY
Share capital 64.1 64.1
Share premium 874.3 874.3
Treasury shares reserve (770.6) (770.6)
Permanent contribution to capital 0.1 0.1
Capital redemption reserve 8.0 8.0
Foreign currency translation reserve 22.1 25.7
Reverse combination reserve (987.3) (987.3)
Own share reserve (66.8) (66.8)
Hedging reserve 7.5 21.7
Share based payment reserve 60.1 51.4
Revaluation reserve 1.2 1.2
Retained earnings 2,747.4 2,623.0
Issued capital and reserves attributable to owners of the parent 1,960.1 1,844.8
Non-controlling interests 28.0 28.2
TOTAL EQUITY 1,988.1 1,873.0
The Group's Financial Statements were approved by the Board and authorised for
issue on 16 July 2025 and were signed on its behalf by:
Chris Wootton
Chief Financial Officer
CONSOLIDATED CASH FLOW STATEMENT
For the 52 weeks ended 27 April 2025
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(restated) ((1))
(£'m) (£'m)
Profit before income tax from:
Continuing operations 379.4 501.0
Discontinued operations 6.3 (6.5)
Profit before taxation including discontinued operations 385.7 494.5
Net finance costs 153.6 49.6
Net investment costs / (income) 30.3 (9.5)
Profit on disposal of subsidiaries (4.3) (20.9)
Depreciation of property, plant and equipment 271.9 282.8
Amortisation of intangible assets 3.5 1.8
Net (reversal)/impairment of tangible and intangible assets and investment (9.6) 21.4
properties
(Gain)/loss on modification/remeasurement of lease liabilities (9.7) 6.6
Profit on sale of properties (0.6) (3.5)
Fair value adjustments in respect of investment property (13.1) (11.5)
Share of profit of associated undertakings (2.0) -
Gain on bargain purchase (6.8) (0.7)
Employee bonus scheme charge 0.8 23.4
Pension scheme expenses 0.7 0.6
Operating cash inflow before changes in working capital 800.4 834.6
Decrease/(increase) in receivables 131.5 (47.4)
Decrease in inventories 203.4 114.1
Decrease in payables (18.4) (42.6)
Decrease in provisions (33.2) (47.5)
Cash inflows from operating activities 1,083.7 811.2
Income taxes paid (140.3) (129.0)
Net cash inflows from operating activities 943.4 682.2
Proceeds on disposal of property, plant and equipment and investment property 25.3 55.9
Proceeds on disposal of listed investments 126.9 133.3
Proceeds in relation to equity derivatives 278.7 58.0
Disposal of subsidiary undertakings 15.7 25.0
Purchase of subsidiaries, net of cash acquired((3)) (47.4) (60.9)
Purchase of property, plant and equipment, intangible assets and investment (411.7) (267.2)
property
Purchase of listed investments (820.9) (382.6)
Purchase of associated undertakings (17.2) -
Increase in deposits relating to equity derivatives((2)) (1,587.4) (742.3)
Decrease in deposits relating to equity derivatives((2)) 1,203.7 793.4
Investment income received 5.7 2.3
Finance income received 17.1 29.3
Net cash outflows from investing activities (1,211.5) (355.8)
Lease payments (142.0) (162.8)
Finance costs paid (83.1) (64.9)
Borrowings drawn down 1,479.5 482.1
Borrowings repaid (1,092.5) (425.6)
Purchase of own shares - (126.4)
Net cash inflows/(outflows) from financing activities 161.9 (297.6)
Net (decrease)/increase in cash and cash equivalents including overdrafts (106.2) 28.8
Exchange movement on cash balances (0.2) (3.1)
Cash and cash equivalents including overdrafts at beginning of period 358.6 332.9
Cash and cash equivalents including overdrafts at the period end 252.2 358.6
((1) Restated to reflect the classification of the results of
Game Spain as a discontinued operation. Please refer to note 1 for further
information.)
((2) Movements in deposits relating to equity derivatives in
both the current and prior year have been presented on a gross basis. This has
no impact on net cash outflows from investing activities or net cash as
previously reported.)
((3) Includes £18.8m paid to increase the Group's ownership of
Sports Direct Malaysia Sdn. Bhd to 100%.)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the 52 weeks ended 27 April 2025
Share capital Share premium((1)) Treasury shares Share- based payment reserve Foreign currency translation reserve Own share reserve Retained earnings Other((2)) Total attributable to owners of parent Non-controlling interests Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
At 30 April 2023 64.1 874.3 (644.2) 33.1 47.4 (66.8) 2,285.5 (965.2) 1,628.2 40.0 1,668.2
Acquisitions((3)) - - - - - - - - - (17.6) (17.6)
Share scheme - - - 18.3 - - - - 18.3 - 18.3
Purchase of own shares - - (126.4) - - - - - (126.4) - (126.4)
Transactions with owners in their capacity as owners - - (126.4) 18.3 - - - - (108.1) (17.6) (125.7)
Profit for the financial period - - - - - - 380.8 - 380.8 5.8 386.6
Other comprehensive income
Cashflow hedges - recognised in the period - - - - - - - 25.5 25.5 - 25.5
Cashflow hedges - recognised time value of options - - - - - - - (0.7) (0.7) - (0.7)
Cashflow hedges - reclassified and reported in sales - - - - - - - (6.1) (6.1) - (6.1)
Cashflow hedges - reclassified and reported in inventory/cost of sales - - - - - - - (8.1) (8.1) - (8.1)
Cashflow hedges - taxation - - - - - - - (2.9) (2.9) - (2.9)
Fair value adjustment in respect of long-term financial assets - - - - - - (43.7) - (43.7) - (43.7)
Fair value adjustment in respect of investment properties - - - - - - - 1.2 1.2 - 1.2
Remeasurements of defined benefit pension scheme - - - - - - 0.4 - 0.4 - 0.4
Translation differences - Group - - - - (21.7) - - - (21.7) - (21.7)
Total comprehensive income for the period - - - - (21.7) - 337.5 8.9 324.7 5.8 330.5
At 28 April 2024 64.1 874.3 (770.6) 51.4 25.7 (66.8) 2,623.0 (956.3) 1,844.8 28.2 1,873.0
Acquisitions((3)) - - - - - - (18.3) - (18.3) (1.1) (19.4)
Share scheme - - - 8.7 - - - - 8.7 - 8.7
Purchase of own shares - - - - - - - - - - -
Transactions with owners in their capacity as owners - - - 8.7 - - (18.3) - (9.6) (1.1) (10.7)
Profit for the financial period - - - - - - 292.1 - 292.1 0.9 293.0
Other comprehensive income
Cashflow hedges - recognised in the period - - - - - - - (9.0) (9.0) - (9.0)
Cashflow hedges - reclassified and reported in sales - - - - - - - (12.3) (12.3) - (12.3)
Cashflow hedges - reclassified and reported in inventory/cost of sales - - - - - - - 2.5 2.5 - 2.5
Cashflow hedges - taxation - - - - - - - 4.6 4.6 - 4.6
Fair value adjustment in respect of long-term financial assets - - - - - - (149.6) - (149.6) - (149.6)
Remeasurements of defined benefit pension scheme - - - - - - 0.2 - 0.2 - 0.2
Translation differences - Group - - - - (3.6) - - (3.6) - (3.6)
Total comprehensive income for the period - - - - (3.6) - 142.7 (14.2) 124.9 0.9 125.8
At 27 April 2025 64.1 874.3 (770.6) 60.1 22.1 (66.8) 2,747.4 (970.5) 1,960.1 28.0 1,988.1
(1) The share premium account is used to
record the excess proceeds over nominal value on the issue of shares.
(2) Other reserves comprise permanent
contribution to capital, capital redemption reserve, reverse combination
reserve, the hedging reserve and the revaluation reserve. All movements in the
current period related to the hedging reserve.
(3) In the current and prior period, the
Group increased its ownership in Sports Direct Malaysia.
1. ACCOUNTING POLICIES
Frasers Group Plc (Company number: 06035106) is a public company incorporated
and domiciled in the United Kingdom, its shares are listed on the London Stock
Exchange. The registered office is Unit A, Brook Park East, Shirebrook, NG20
8RY. The principal activities and structure of the Group can be found in the
Directors' Report and the 'Our Business' section of the Annual Report.
BASIS OF PREPARATION
Whilst the financial information included in this Preliminary Announcement has
been prepared on the basis of UK-adopted International Accounting standards,
this announcement does not itself contain sufficient information to comply
with UK-adopted International Accounting Standards.
The financial information set out in this Preliminary Announcement does not
constitute the Group's Consolidated Financial Statements for the period ended
27 April 2025 but is derived from those Financial Statements which were
approved by the Board of Directors on 16 July 2025. The auditor, RSM UK Audit
LLP, has reported on the Group's Consolidated Financial Statements and the
report was unqualified and did not contain a statement under section 498 (2)
or 498 (3) of the Companies Act 2006.
The statutory financial statements for the period ended 27 April 2025 have not
yet been delivered to the Registrar of Companies and will be delivered
following the Company's Annual General Meeting.
The Group financial statements have been prepared and approved by the
Directors in accordance with UK-adopted International Accounting Standards.
The Group's accounting policies are set out in the 2024 Annual Report and
Accounts and have been applied consistently in 2025 except as noted below.
Going Concern
The Group's business activities, together with the factors likely to affect
its future development, performance and position are set out in the Chief
Executive's Report and Business Review section above.
The financial position of the Group, its cash flows, liquidity position and
borrowing facilities are described in the Financial Review. In addition, the
financial statements include the Group's objectives, policies and processes
for managing its capital, its financial risk management objectives, details of
its financial instruments and hedging activities, and its exposures to credit
risk and liquidity risk.
The Group is profitable, highly cash generative and has considerable financial
resources. The Group is able to operate within its banking facilities and
covenants, which run until July 2028 and is well placed to take advantage of
strategic opportunities as they arise. As a consequence, the Directors believe
that the Group is well placed to manage its business risks successfully
despite the continued uncertain economic outlook.
Management has assessed the level of trading and has forecast and projected a
conservative base case and also a number of even more conservative scenarios,
including taking into account the Group's open positions in relation to Hugo
Boss options. These forecasts and projections show that the Group will be able
to operate within the level of the current facility and its covenant
requirements (being interest cover and net debt to pre-IFRS 16 EBITDA ratios).
Management also has a number of mitigating actions which could be taken if
required such as putting on hold discretionary spend, liquidating certain
assets on the balance sheet, or reducing inventory cover. See the Viability
Statement in the Annual Report for further details.
Having thoroughly reviewed the performance of the Group and Parent Company and
having made suitable enquiries, the Directors are confident that the Group and
Parent Company have adequate resources to remain in operational existence for
the foreseeable future, which is at least 12 months from the date of these
financial statements. Trading would need to fall significantly below levels
observed historically to require mitigating actions or a relaxation of
covenants. On this basis, the Directors continue to adopt the going concern
basis for the preparation of the Annual Report and financial statements which
is a period of at least 12 months from the date of approval of these financial
statements.
New Accounting Standards, Interpretations and Amendments Adopted By The Group
The Group has not early adopted any new accounting standard, interpretation or
amendment that has been issued but is not effective. The Group has applied for
the first time the following new standards:
· Classification of liabilities as current or Non-current and
Non-current liabilities with covenants - Amendments to IAS 1.
· Lease liability in sale and leaseback - Amendments to IFRS 16
· Supplier financing arrangements - Amendments to IAS 7 and IFRS 7
By adopting the above, there has been no material impact on the Financial
Statements.
International Financial Reporting Standards ("Standards") In Issue But Not Yet
Effective
At the date of authorisation of the consolidated Financial Statements,
standards, interpretations and amendments that became effective in the current
financial year have not had a material impact on the consolidated Group
financial statements. The Group has not applied any standards, interpretations
or amendments that have been issued but are not yet effective.
The impact of the following is under assessment and is expected to have a
material impact on the presentation of the Consolidated Income Statement in
future years:
· IFRS 18 'Presentation and disclosure in financial statements',
which will become effective in the consolidated Group financial statements for
the financial year ending April 2028, subject to UK endorsement.
On 11 July 2023, rules were enacted to ensure large multi-national groups pay
a minimum level of corporation tax in respect of all countries where they
operate (known as "Pillar 2"). These came effect for the Group from 1 May
2024. Based on the Group's current business and tax profile, the implement
of Pillar 2 legislation will not have a material impact on the Group's tax
rate or tax payments. The estimated additional potential cost under the
known Pillar 2 principles is approx. £0.5m.
The Group has applied the exception under IAS 12 to recognising and disclosing
information about deferred tax assets and liabilities related to top-up taxes.
Restated Financial Information
Reclassification of delivery income and costs associated with free-issue gift
vouchers
Following a review of financial reporting processes undertaken during the
current period, management identified that income received from customers in
respect of the delivery on online orders and the costs associated with
offering free-issue gift vouchers (essentially a discount against a future
order) had been incorrectly classified within selling, distribution and
administrative expenses rather than within revenue.
The impact of this change in the current period is to increase revenue (and
consequently gross profit) by £90.0m and to increase selling, distribution
and administrative expenses by the same amount. The results for the prior
period have been restated on an equivalent basis resulting in a £74.0m
increase to revenue (and consequently gross profit) and a corresponding
increase in selling, distribution and administrative expenses.
This change does not impact upon the Group's reported profit, earnings per
share, consolidated balance sheet or consolidated cashflow statement in either
the current or prior period.
Game Spain
The Group completed the disposal of the Game Spain business on 19 March 2025
by way of selling the entire share capital of Game Spain Iberia, SL to
Guidebridge Opportunities 4, S.L. In accordance with IFRS 5.32, management
considered that Game Spain constituted a separate major line of business that
had been disposed of and that it therefore met the criteria to be classified
as a discontinued operation. Consequently, its results for the current period
have been presented separately as a single line item within the Consolidated
Income Statement. The prior period results have been restated on an equivalent
basis.
2. CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES
Climate Change
We have considered the potential impact of climate change in preparing these
financial statements. Tackling climate change is a global imperative.
Measures which support climate change initiatives and our wider ESG agenda
continue to be key components of our strategic direction, supporting
sustainability, the broader social agenda and consumer choice. The risks
associated with climate change have been deemed to be arising in the medium to
long term, however we are working to mitigate these risks as detailed within
the TCFD section of the annual report.
We have considered climate change as part of our cash flow projections within
going concern, impairment assessments and viability, and the impact of climate
change is not deemed to have a significant impact on these assessments
currently and therefore they are not deemed to be a key source of estimation
uncertainty. The Group will continue to monitor the impacts of climate change
over the coming years.
Critical Accounting Judgements
Determining Related Party Relationships
Management determines whether a related party relationship exists by assessing
the nature of the relationship by reference to the requirements of IAS 24,
Related Party Disclosures. This is in order to determine whether significant
influence exists as a result of control, shared directors or parent companies,
or close family relationships. The level at which one party may be expected to
influence the other is also considered for transactions involving close family
relationships.
Control and Significant Influence Over Certain Entities
Under IAS 28 Investments in Associates and Joint Ventures ("IAS 28"), if an
entity holds 20% or more of the voting power of the investee, it is presumed
that the entity has significant influence, unless it can clearly demonstrate
that this is not the case.
In assessing the level of control that management have over certain entities,
management will consider the various aspects that allow management to
influence decision making. This includes the level of share ownership, board
membership, the level of investment and funding and the ability of the Group
to influence operational and strategic decisions and affect its returns
through the exercise of such influence. If management were to consider that
the Group does have significant influence over these entities then the equity
method of accounting would be used and the percentage shareholding multiplied
by the results of the investee in the period would be recognised in profit or
loss.
Shareholdings in investees greater than 20%
Mulberry Group plc
Management consider that the Group did not have significant influence at any
point in the current or prior periods for the following reasons:
• The Group does not have any representation on the board of
directors.
• There is no participation in decision making and strategic
processes, including participation in decisions about dividends or other
distributions. In this regard, it was noted that there is another shareholder
(Challice Limited) who owns over 50% of the shares.
• There have been no material transactions between the Group and
the investee.
• There has been no interchange of managerial personnel.
• No non-public essential technical management information is
provided by the investee.
Management notes that, subsequent to the year-end, a representative of the
Group was appointed to the board of Mulberry. Management considers that the
change in ownership post year-end does not indicate that significant influence
existed at any point during FY25 but will be relevant to the FY26 assessment,
which has not yet taken place.
XXL ASA ("XXL")
Management consider that the Group did not have significant influence at any
point in the current or prior periods for the following reasons:
• The Group does not have any representation on the board of
directors.
• There is no participation in decision making and strategic
processes, including participation in decisions about dividends or other
distributions (as evidenced by the rebuttal of the Group's initial attempts to
assist in the business's fundraising efforts in FY25).
• There have been no material transactions between the Group and
the investee.
• There has been no interchange of managerial personnel.
• No non-public essential technical management information is
provided by the investee.
Management notes that, subsequent to the year-end, the Group has acquired a
majority shareholding in XXL and will therefore consolidate XXL's results from
the point the Group obtained control in FY26. Management considers that the
change in ownership post year-end does not indicate that significant influence
existed at any point during FY25 but will be relevant to the FY26 assessment,
which has not yet taken place.
ASOS plc
Management consider that the Group did not have significant influence at any
point in the current or prior periods for the following reasons:
• The Group does not have any representation on the board of
directors.
• There is no participation in decision making and strategic
processes, including participation in decisions about dividends or other
distributions. In this regard, it was noted that there is another shareholder
with a larger shareholding than the Group.
• There have been no material transactions between the Group and
the investee.
• There has been no interchange of managerial personnel.
• No non-public essential technical management information is
provided by the investee.
AO World plc
Management consider that the Group did not have significant influence at any
point in the current or prior periods for the following reasons:
• The Group does not have any representation on the board of
directors.
• There is no participation in decision making and strategic
processes, including participation in decisions about dividends or other
distributions. It was noted that there are a number of other shareholders who
hold large investments comparable to the Group's. These include John Roberts
(the founder of the business) who remains a board director and currently holds
17.5% of the voting rights, and also Camelot Capital who hold 20.4% of the
voting rights. In combination, these other large shareholders could block any
resolutions proposed by the Group.
• There have been no material transactions between the Group and
the investee.
• There has been no interchange of managerial personnel.
• No non-public essential technical management information is
provided by the investee.
Boohoo Group plc
Management consider that the Group did not have significant influence at any
point in the current or prior periods for the following reasons:
• The Group does not have any representation on the board of
directors. The Group attempted to get directors appointed to the Board during
FY25, but these attempts were rebuffed.
• There is no participation in decision making and strategic
processes, including participation in decisions about dividends or other
distributions. It was noted that the Kamani family holds 22.8% of voting
rights in the company and that the two founders of the group are members of
the board of directors. These individuals run the business on a day-to-day
basis and the Group's management do not consider that they exert significant
influence on them.
• There have been no material transactions between the Group and
the investee.
• There has been no interchange of managerial personnel.
• No non-public essential technical management information is
provided by the investee.
Four (Holdings) Limited
The Group holds 49% of the share capital of Four (Holdings) Limited which is
accounted for as an associate using the equity method. The Group does not have
any representation on the board of directors and no participation in decision
making about relevant activities such as establishing operating and capital
decisions, including budgets, appointing or remunerating key management
personnel or service providers and terminating their services or employment.
However, in prior periods the Group has provided Four (Holdings) Limited with
a significant loan. At the reporting date, the amount owed by Four (Holdings)
Limited for this loan totalled £22.5m (FY24: £30.0m), being £6.3m (FY24:
£6.4m) net of amounts recognised in respect of loss allowance. The Group is
satisfied that the existence of these transactions provides evidence that the
entity has significant influence over the investee but in the absence of any
other rights, in isolation it is insufficient to meet the control criteria of
IFRS 10, as the Group does not have power over Four (Holdings) Limited.
Tymit Limited
The Group holds 44.2% (FY24: 28.2%) of the share capital of Tymit Limited.
This holding is accounted for as an associate under IAS 28, although the
carrying value of the investment is £nil as a result of management's
assessment of future trading prospects of the business. Management has
advanced Tymit convertible loans of £16.8m at 27 April 2025 (£15.8m as 28
April 2024), which have been fully provided for. Management has considered
whether any of the rights attaching to the loan notes could give rise to
control and concluded that this was not the case.
Kangol LLC
The Group holds 49% of the share capital of Kangol LLC having sold 51% of its
shareholding to Bollman Hat Company for £17.6m in the prior period.
Management considered the criteria set out in IFRS 10 when assessing whether
or not it retains control of the entity or significant influence as defined by
IAS 28. It was concluded that the Group has significant influence by virtue of
its holding more than 20% of the voting power of the investee, but not control
since Bollman holds 51% of total voting rights. Consequently, the Group's 49%
shareholding has been accounted for as an associate under IAS 28.
Hudson Holdings ("Hudson")
The Group acquired at 41.8% holding in Hudson during FY25. This holding is
accounted for as an associate under IAS 28 as the Group exhibits significant
influence over the investee.
Consideration of significant influence in investees with holdings lower than
20%
Hugo Boss
Whilst the Group's shareholding was below the 20% threshold set out in IAS 28
at FY25 year-end, management notes that Michael Murray was appointed to Boss's
supervisory board on 16 May 2025 and the Group's shareholding has subsequently
increased to approximately 25%. Management consider that these changes do not
indicate that significant influence existed at any point during FY25 but will
be relevant to the FY26 assessment, which has not yet taken place.
Accent
Management notes that a representative of the Group was appointed to the board
of Accent during FY25, and that the Group entered into a long-term partnership
with Accent in May 2025, increasing it's shareholding to approximately 20% at
that point. Management consider that these changes do not indicate that
significant influence existed at any point during FY25 but will be relevant to
the FY26 assessment, which has not yet taken place.
Cash Flow Hedging
The Group uses a range of forward and option contracts that are entered into
at the same time; they are in contemplation with one another and have the same
counterparty. A judgement is made in determining whether there is an economic
need or substantive business purpose for structuring the transactions
separately that could not also have been accomplished in a single transaction.
Management are of the view that there is a substantive distinct business
purpose for entering into the options and a strategy for managing the options
independently of the forward contracts. The forward and options contracts are
therefore not viewed as one instrument; accordingly hedge accounting for the
forwards is permitted.
Under IFRS 9 in order to achieve cash flow hedge accounting, forecast
transactions (primarily Euro denominated sales and USD denominated purchases)
must be considered to be highly probable. The hedge must be expected to be
highly effective in achieving offsetting changes in cash flows attributable to
the hedged risk. The forecast transaction that is the subject of the hedge
must be highly probable and must present an exposure to variations in cash
flows that could ultimately affect profit or loss.
Management have reviewed the detailed forecasts and the growth assumptions
within them and are satisfied that forecasts on which the cash flow hedge
accounting has been based meet the criteria per IFRS 9 as being highly
probable forecast transactions. Should the forecast levels not pass the highly
probable test, any cumulative fair value gains and losses in relation to
either the entire or the ineffective portion of the hedged instrument would be
recognised in the Consolidated Income Statement.
Management considers various factors when determining whether a forecast
transaction is highly probable. These factors include detailed sales and
purchase forecasts by channel, geographical area and seasonality, conditions
in target markets and the impact of expansion in new areas. Management also
consider any change in alternative customer sales channels that could impact
on the hedged transaction.
If the forecast transactions were determined to be not highly probable and all
hedge accounting was discontinued, amounts in the Hedging reserve of up to
£7.5m (FY24: £21.7m) would be shown in Finance Income.
Classification of investment properties
Upon the acquisition of a property, management perform an assessment of the
rationale for holding the property in line with IAS 40. This assessment
includes a consideration of current use, future plans for the property and the
strategy employed by the Group in managing the property. Management applies
judgement in the consideration of whether or not it is feasible to sell or let
parts of the property under a finance lease, whether this is commercially
viable in the relevant marketplace, and whether or not any owner-occupied
portion is insignificant.
During the current period, the Group acquired seven properties (FY24: four),
all of which met the criteria to be classified as investment properties and
were considered to be non-separable, with either insignificant or no
owner-occupied portions.
Key Estimates
Inventory provisioning
The Group carries significant amounts of inventory, against which there are
provisions for expected losses to be incurred in the sale of slow moving,
obsolete and delisted products. At 27 April 2025, a provision of £146.8m
(FY24: £192.0m) was held against a gross inventory value of £1,275.1m (FY24:
£1,547.3m).
In assessing the level of provision required, management has applied its
experience and industry knowledge to divide the core UK inventory holding into
separate categories based on internal management classifications and
behavioural characteristics, taking account of experience by fascia and
segment, as follows:
· Continuity inventory - inventory that is considered to be
perennial and therefore exhibits limited risk of obsolescence.
· Current season inventory - inventory that has been purchased
specifically for seasons in the current calendar year and future years.
· Out of season inventory (including inventory previously
classified as continuity) - inventory that has moved out of the two categories
above because of its age, range development or because it is being sold at
below cost to clear warehouse/store space.
An adjusted rate of loss is then calculated based on losses incurred on the
sale of out of season inventory over the past three years (being management's
assessment of the time taken to clear through out of season inventory), with
any inventory remaining on hand after three years of being classified as out
of season being assumed to require a 100% provision rate. The historical rate
is sensitised to reflect management's best estimate of future performance by
making assumptions around changes to sales prices achieved on the sale of out
of season inventory vs. those achieved in the past three years and the level
of inventory remaining after three years of being classified as out of season.
In the current period, management have estimated that selling prices will need
to reduce by a further 5% (FY24: 15%) to clear an equivalent volume of out of
season inventory and that approximately two times (FY24: fifteen times) as
much Premium Lifestyle out of season inventory will remain on hand at the end
of the three-year period of assessment than has typically been the case
historically, requiring a 100% provision rate, reflecting the different
profile of this inventory to Sports inventory. The changes in assumptions
around selling prices and Premium Lifestyle out of season inventory will
remain on hand reflect management's best estimates based on performance seen
in the past 12 months.
In addition, management has applied a provision rate of 100% against a portion
of the inventory holding that is either currently being sold at a loss or
exhibits an unusually high level of obsolescence risk. The 100% provision rate
reflects the costs associated with clearing and disposing of this inventory.
Consideration is also given to a provision to reflect an element of shrinkage
(due to inventory loss in stores or warehouses) that will be present in the
closing inventory figure based on average rates of shrinkage and average
inventory turn rates.
The adjusted rate of loss is applied to the gross value of inventory in each
of the categories above as follows:
· Continuity inventory - the adjusted loss rate is applied to 30%
of the gross holding (representing the proportion of inventory in this
category that is expected to roll into the out of season category based on
historical experience and anticipated future trends).
· Current season inventory - the adjusted loss rate is applied to
30 % of the gross holding (representing the proportion of inventory in this
category that is expected to roll into the out of season category based on
historical experience and anticipated future trends).
· Out of season inventory (including inventory previously
classified as continuity) - the adjusted loss rate is applied to this
population, excluding those specific items that carry a 100% provision rate
based on the analysis detailed above.
The provisioning calculations require a high degree of judgement, given the
significant level of estimation uncertainty in the roll rates between
classifications, as well as the use of estimates around future sales prices
and the remaining inventory holding for out of season inventory. Sensitivity
analysis relating to these key assumptions and its impact upon the core UK
inventory holding (which makes up the most significant part of the Group's
inventory holding) is set out below.
% of inventory rolling into out of season (including inventory previously
classified as continuity) category
Base assumption 30%
Sensitised assumption 35%/25%
Increase/(decrease) to provision £3.8m/(£3.8m)
Decrease in sales prices on out of season inventory
Base assumption -5%
Sensitised assumption -10%/nil%
Increase/(decrease) to provision £6.6m/(£3.3m)
Increase in out of season Premium Lifestyle inventory on hand after three
years
Base assumption 2 times historical rate
Sensitised assumption 3 times historical rate/1 times historical rate
Increase/(decrease) to provision £6.1m/(£6.3m)
These sensitivities reflect management's assessment of reasonably possible
changes to key assumptions which could result in adjustments to the level of
provision within the next financial year.
Dilapidations
The Group provides for its legal responsibility for dilapidation costs
following advice from chartered surveyors and previous experience of exit
costs (including strip out costs and professional fees). Management do not
consider these costs to be capital in nature and therefore dilapidations are
not capitalised, except for in relation to the sale and leaseback of
Shirebrook for which a material dilapidations provision was capitalised in
FY20.
Management calculates its best estimate of the provision required by reference
to the proportion of closed stores for which a dilapidation cost is likely to
be incurred, based on past experience, and an estimate for the level of costs
based on advice from chartered surveyors. The annual movement in the
dilapidations provisions is considered immaterial.
Sensitivity analysis to changes in key assumptions is as follows:
Estimated cost per sq. ft. % of stores where a dilapidation cost is incurred
Base assumption £18.10 25%
Sensitised assumption £19.10/£17.10 30%/20%
Increase to provision £1.8m £5.9m
(Decrease) to provision (£1.8m) (£5.9m)
Legal and regulatory provisions
Provisions are made for items where the Group has identified a present legal
or constructive obligation arising as a result of a past event, it is probable
that an outflow of resources will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation.
Legal and regulatory provisions reflect management's best estimate of the
potential costs arising from the settlement of outstanding disputes of a
commercial and regulatory nature. A substantial portion of the amounts
provided relates to ongoing legal claims and non-UK tax enquiries. Management
have made a judgement to consider all claims collectively given their similar
nature. In accordance with IAS37.92, management have concluded that it would
prejudice seriously the position of the entity to provide further specific
disclosures in respect of amounts provided for non-UK tax enquiries and legal
claims.
Other receivables and amounts owed by related parties
Other receivables and amounts owed by related parties are stated net of
provision for any impairment. Management have applied estimates in assessing
the recoverability of working capital and loan advances made to investee
companies. Matters considered include the relevant financial strength of the
underlying investee company to repay the loans, the repayment period and
underlying terms of the monies advanced, forecast performance of the
underlying borrower, and where relevant, the Group's intentions for the
companies to which monies have been advanced. Management have applied a
weighted probability to certain potential repayment scenarios, with the
strongest weighting given to expected default after two years.
Impairment of non-financial assets
a) IFRS 16 right-of-use assets and associated plant and equipment
IFRS 16 defines the lease term as the non-cancellable period of a lease
together with the options to extend or terminate a lease, if the lessee were
reasonably certain to exercise that option. The Group will assess the
likelihood of extending lease contracts beyond the break date by taking into
account current economic and market conditions, current trading performance,
forecast profitability and the level of capital investment in the property.
IFRS 16 states that the lease payments shall be discounted using the lessee's
incremental borrowing rate where the rate implicit in the lease cannot be
readily determined. Accordingly, all lease payments have been discounted using
the incremental borrowing rate (IBR). The IBR has been determined by using a
credit rating for the Group which is used to obtain market data on debt
instruments for companies with the same credit rating; this is split by
currency to represent each of the geographical areas the Group operates within
and adjusted for the lease term.
The weighted average discount rates based on incremental borrowing rates used
throughout the period across the Group's lease portfolio are shown below. The
discount rate for each lease is dependent on lease start date, term and
location.
Lease Term FY25 UK Europe Rest of World
Up to 5 years 1.4% - 5.7% 0.3% - 4.0% 1.5% - 6.0%
Greater than 5 years and up to 10 years 2.0% - 5.7% 0.5% - 4.0% 2.4% - 5.7%
Greater than 10 years and up to 20 years 2.2% - 5.8% 0.8% - 4.0% 2.9% - 5.9%
Greater than 20 years 2.5% - 5.9% 1.1% - 4.1% 3.5% - 6.1%
Lease Term FY24 UK Europe Rest of World
Up to 5 years 1.4% - 5.7% 0.3% - 4.0% 1.5% - 6.2%
Greater than 5 years and up to 10 years 1.4% - 5.7% 0.3% - 4.0% 1.5% - 6.0%
Greater than 10 years and up to 20 years 2.0% - 5.7% 0.3% - 4.0% 1.5% - 6.2%
Greater than 20 years 2.0% - 5.9% 0.5% - 4.0% 1.5% - 6.3 %
An asset is impaired when the carrying amount exceeds its recoverable amount.
Equally previous impairments are reversed when the recoverable amount exceeds
the carrying amount and there are previous impairments against the asset. IAS
36 defines recoverable amount as the higher of an asset's or cash-generating
unit's fair value less costs of disposal and its value in use. The Group has
determined that each store is a separate CGU.
The recoverable amount is calculated based on the Group's latest forecast cash
flows which are then extrapolated to cover the period to the break date of the
lease taking into account historic performance and knowledge of the current
market, together with the Group's views on future profitability of each CGU.
The key assumptions in the calculations are the sales growth rates, gross
margin rates, changes in the operating cost base and the pre-tax discount rate
derived from the Group's weighted average cost of capital using the capital
asset pricing model, the inputs of which include a risk-free rate, equity risk
premium and a risk adjustment (Beta). Given the number of assumptions used,
the assessment involves significant estimation uncertainty.
In the period, a net reversal of previous impairments has been recognised for
the amount of £5.0m (FY24: a net reversal £0.4m) due to the improving
conditions in the retail sector on the forecast cash flows of the CGU. This is
broken down as follows:
• £6.2m reversal (FY24: reversal £5.2m) against right-of-use
assets; and
• £1.2m impairment charge (FY24: impairment charge £4.8m)
against plant and equipment.
The key assumptions, which are equally applicable to each CGU, in the cash
flow projections used to support the carrying amount of the right of use asset
are consistent with the cashflow projections for the freehold land and
buildings impairment assessment.
A sensitivity analysis has been performed in respect of sales, margin, the new
store exemption and operating costs as these are considered to be the most
sensitive of the key assumptions:
Forecast: Impact of change in assumption: Reversal increase / (decrease) (£'m)
Sales decline year 1 10% improvement to 9% increase 0.7
Sales decline year 1 10% reduction to 11% decline (5.1)
Existing gross margin year 1 > 40% 100bps - improvement 0.3
Existing gross margin year 1 > 40% 100bps - reduction (0.5)
New store exemption ((1)) Change from 2 to 3 years 6.3
Operating costs increase year 1 Change from 2% to 5% (0.5)
(1) Stores which have been open for less than two years are not
reviewed for impairment. This changed in the prior period on the basis that
management do not consider that a trading performance in the first two years
that is worse than an appraisal forecast constitutes an indicator of
impairment. Management also notes that new stores can take up to two years to
develop an established trading pattern. Stores trading for less than two years
are still reviewed for impairment if there are other significant indicators of
impairment present such as a deterioration in local market conditions.
b) Freehold land and buildings, long-term leasehold and associated
plant and equipment
Freehold land and buildings and long-term leasehold assets are assessed at
each reporting period for as to whether there is any indication of impairment
or reversal in line with IAS 36.
An asset is impaired when the carrying amount exceeds its recoverable amount.
Equally previous impairments are reversed when the recoverable amount exceeds
the carrying amount and there are previous impairments against the asset. IAS
36 defines recoverable amount as the higher of an asset's or cash-generating
unit's fair value less costs of disposal and its value in use. the Group has
determined that each store is a separate CGU.
Key triggers considered by management include store (i.e., CGU) EBITDA showing
a material year-on-year movement, significant changes in property valuations,
and whether any new, wider economic factors may impact the forecast
performance. Based on the criteria set by management, a reversal of £4.6m
(FY24: net impairment charge £14.9m) was recorded for the current period due
to certain properties out performing against forecasted results where material
impairments were previously incurred. This is broken down as follows:
• £2.7m reversal (FY24: reversal of £6.8m) against freehold land
and buildings and a £0.7m reversal (FY24: impairment charge £6.7m) in
relation to long leasehold properties; and
• £1.2m reversal (FY24: impairment charge £15.0m) against
plant and equipment.
Value In Use (VIU)
The value in use is calculated based on five-year cash flow projections. These
are formulated by using the Group's forecast cash flows for each individual
CGU, taking into account historic performance of the CGU, and then adjusting
for the Group's current views on future profitability for each CGU. The key
assumptions in the calculations are the sales growth rates, gross margin
rates, changes in the operating cost base and the pre-tax discount rate
derived from the Group's weighted average cost of capital using the capital
asset pricing model, the inputs of which include a risk-free rate, equity risk
premium and a risk adjustment (Beta). Given the number of assumptions used,
the assessment involves significant estimation uncertainty.
The key assumptions, which are equally applicable to each CGU, in the cash
flow projections used to support the carrying amount of the freehold land and
buildings were as follows:
Key assumptions FY25 Year 1 Year 2 Year 3 Year 4 Year 5
Sales decline -1% -1% -1% -1% -1%
Existing gross margin > 40% -50bps -25bps - - -
Operating costs increase per annum 2% 2% 2% 2% 2%
Discount rate 10.6% 10.6% 10.6% 10.6% 10.6%
Terminal growth rate of 2%
Properties purchased within two years, or stores that have not traded for two
years, are not reviewed for impairment.
Key assumptions FY24 Year 1 Year 2 Year 3 Year 4 Year 5
Sales decline -3% -2% -2% -2% -2%
Existing gross margin > 40% -100bps -75bps -50bps -25bps -
Operating costs increase per annum 3% 3% 3% 3% 3%
Discount rate 9.8% 9.8% 9.8% 9.8% 9.8%
Terminal growth rate of 2%
Properties purchased within one year, or stores that have not traded for two
years, are not reviewed for impairment.
A sensitivity analysis has been performed in respect of sales, margin and
operating costs as these are considered to be the most sensitive of the key
assumptions.
Forecast: Impact of: Reversal increase / (decrease) (£'m)
Sales decline year 1 10% improvement to 9% sales increase -
Sales decline year 1 10% reduction to 11% sales decline -
Existing gross margin year 1 > 40% 100bps - improvement -
Existing gross margin year 1 > 40% 100bps - reduction -
Operating costs increase year 1 Change from 2% to 5% -
The reasonably possible movements in the assumptions listed above do not
result in a change in the reversals indicated.
Fair value less costs of disposal
For those CGUs where the value in use is less than the carrying value of the
asset, the fair value less costs of disposal has been determined using both
external and internal market valuations. This fair value is deemed to fall
into Level 3 of the fair value hierarchy as per IFRS 13. The property
portfolio consists of vacant, Frasers Group occupied and third party tenanted
units; one property can include all three types. The following valuation
methodology has been adopted for each:
Scenario Valuation methodology Key assumptions
Vacant units Estimated Rental Value (ERV) and suitable reversionary yield applied to Void period and rent-free band - three bands applied depending on
reflect the market to generate a net capital value. A deduction to the capital circumstances:
value generated is then made based on the void period with applicable rates
payable for the unit and rent-free incentive. • 1 year void, 1 year rent free; or
• 1 year void, 2 years rent free; or
• 2 years void, 3 years rent free.
Yield bands - ranging from 6.0% - 20.0%
Frasers Group occupied Will be assumed the unit is vacant given there is no legally binding Void period and rent-free band - three bands applied depending on
inter-company agreement in place. Therefore, a void and rent-free incentive circumstances:
period assumed, the cost amount then deducted from the capital value generated
by the ERV and reversionary yield. Although we consider the commercial reality • 1 year void, 1 year rent free; or
is that fair value less costs to sell will be higher than vacant possession,
this very conservative assumption is in line with both technical accounting
rules and that of our management experts.
• 1 year void, 2 years rent free; or
• 2 years void, 3 years rent free.
Yield bands - ranging from 6.0% - 20.0%
Third party tenanted An ERV is applied using a percentage band on the passing rent. An appropriate ERV is applied reflecting the market for the applicable unit. An appropriate
reversionary yield is applied reflecting the risk of tenant and renewal to reversionary yield is applied reflecting the risk of tenant and renewal to
generate a capital value. This will also provide a net initial yield based off generate a capital value. This will also provide a net initial yield based off
the current passing rent. the current passing rent.
A 10% increase in the market valuation amounts used in the impairment/reversal
calculations would result in a £nil impact on the reversal charge (FY24:
£0.8m).
The total recoverable amount of the assets that were reversed at the period
end was £82.3m (FY24: £61.8m), with £nil (FY24: £7.7m) of this being based
on their fair value less costs of disposal and £82.3m (FY24: £54.1m) being
based on their value in use.
Onerous lease provisions
IAS 37 defines a contract is onerous when the unavoidable costs of meeting the
obligations under the contract exceed the economic benefits expected to be
received under it. The unavoidable costs under a contract reflect the least
net cost of exiting from the contract, which is the lower of the cost of
fulfilling it and any compensation or penalties arising from failure to fulfil
it. Accordingly, the Group provides for the future unavoidable costs that will
be incurred under the lease obligations at the present date when the outflow
of future economic benefits is deemed probable.
The Group has determined that each store is a separate CGU and assess the
profitability of lease contracts by taking into account current economic and
market conditions, current trading performance and forecast profitability over
the remaining life of the lease.
The key assumptions in the calculations are the sales growth rates, gross
margin rates, changes in the operating cost base and the discount rate used.
During the period, net reversal of provisions amounted to £8.8m (FY24:
£34.5m).
A sensitivity analysis has been performed in respect of sales, margin, the new
store exemption and operating costs as these are considered to be the most
sensitive of the key assumptions:
Forecast: Impact of change in assumption: Reversal increase / (decrease) (£'m)
Sales decline year 1 10% improvement to 9% sales increase 4.7
Sales decline year 1 10% reduction to 11% sales decline (11.8)
Existing gross margin year 1 > 40% 100bps - improvement 0.5
Existing gross margin year 1 > 40% 100bps - reduction (1.2)
New store exemption ((1)) Change from 2 to 3 years 9.4
Operating costs increase year 1 Change from 2% to 5% (2.3)
(1) Stores which have been open for less than two years are not
reviewed for impairment. This changed in the prior period on the basis that
management do not consider that a trading performance in the first two years
that is worse than an appraisal forecast constitutes an indicator of
impairment. Management also notes that new stores can take up to two years to
develop an established trading pattern. Stores trading for less than two years
are still reviewed for impairment if there are other significant indicators of
impairment present such as a deterioration in local market conditions.
Investment Property valuations
Investment properties valued by the Group's internal property team are valued
on an open market basis based on active market prices adjusted for any
differences in the nature, location or condition of the specified asset such
as plot size, encumbrances and current use. If this information is not
available, alternative valuation methods are used such as recent prices on
less active markets, or discounted cashflow projections.
The market value of the investment properties is also supported by comparison
to that produced using the valuation methodology described in the "Fair value
less costs of disposal" section above. The range of yield applied across the
investment property portfolio is 6.0% to 20.0%.
Credit Customer Receivables
The Group's credit customer receivables are recognised on the balance sheet at
amortised cost (i.e., net of provision for expected credit loss). At 27 April
2025, trade receivables with a gross value of £254.9m (FY24: £286.9m) were
recorded in the consolidated balance sheet, less a provision for impairment of
£73.2m (FY24: £80.7m).
Expected credit loss
An appropriate allowance for expected credit loss in respect of trade
receivables is derived from estimates and underlying assumptions such as the
Probability of Default and the Loss Given Default, taking into consideration
forward looking macro-economic assumptions. The assessment involves
significant estimation uncertainty. Changes in the assumptions applied such as
the value and frequency of future debt sales in calculating the Loss Given
Default, and the estimation of customer repayments and Probability of Default
rates, as well as the weighting of the macro-economic scenarios applied to the
impairment model could have a significant impact on the carrying value of
trade receivables. These assumptions are continually assessed for relevance
and adjusted appropriately. Revisions to estimates are recognised
prospectively.
Macroeconomic scenarios
The principal macroeconomic driver factored into the impairment model is
unemployment. The latest economic scenarios used in the model along with the
probably weighting applied to each are summarised as follows:
Scenario Qualitative explanation Probability weighting applied
Upside Inflation returns quickly to target despite strong growth and the Bank of 5%
England cuts interest rates to 4% by mid-2025. Unemployment eventually falls
back to 3.8%, wage growth remains strong and supportive as the economy moves
onto a higher productivity path.
Baseline Inflation is expected to end the year at 3.1% (FY24: 2.3%) as more than half 50%
of firms intend to pass on some or all the hit from higher taxes and the
minimum wage. This shouldn't prevent the Monetary Policy Committee from
cutting the Bank Rate to (at least) 4% by end-2025. Affordability constraints
means we still expect a slight fall in prices in the coming months.
Downside By mid 2025 the Bank of England cuts interest rate sharply in the summer as it 30%
becomes clear the slump in demand is adding to global deflationary forces. The
economy goes into recession: GDP falls around 2.5% peak-to-trough. GDP
contracts 0.2% in 2025 and 1.6% in 2026. Unemployment peaks at 6% in Q2 2026.
Stress Inflation rise sharply, hitting a peak of 7.3% during Q4 2025. The Bank of 15%
England raises interest rates to 6.25% in early 2026; the correction in asset
prices turns into a crash. The unemployment rate rises to 8%.
Valuation of assets acquired in business combinations
The principal estimate in the acquisition of Twin Sport was around the fair
value of inventory acquired. The fair value of inventory, which primarily
included finished goods, was estimated at £10.8m, an increase of £1.0m on
the carrying value prior to the acquisition. Overall, the Group recognised
goodwill of £20.5m on acquisition of Twin Sport, with total consideration of
£20.2m for net liabilities at fair value of £0.3m.
3. SEGMENTAL ANALYSIS
IFRS 8 requires operating segments to be identified on the basis of the
internal financial information reports to the Chief Operating Decision Maker
("CODM") who is primarily responsible for the allocation of resources to
segments and assessment of performance of the segments.
The Group presents five operating segments:
· UK Sports
This segment includes the results of the Group's core sports retail store
operations in the UK, plus all the Group's sports retail online business,
other UK-based sports retail and wholesale operations, GAME UK stores and
online operations, retail store operations in Northern Ireland, Frasers
Fitness, Studio Retail's sales and the Group's central operating functions
(including the Shirebrook campus).
· Premium Lifestyle
This segment includes the results of the Group's premium and luxury retail
businesses FLANNELS, Cruise, Van Mildert, Jack Wills, House of Fraser &
Frasers, Gieves and Hawkes, and Sofa.com along with the related websites, the
businesses acquired from JD Sports, as well as the results from the I Saw it
First website and the Missguided website until the disposal of the Missguided
intellectual property in October 2023.
· International
This segment includes the results all of the Group's sports retail stores,
management and operating functions in Europe, Asia and the rest of the world,
including the Group's European Distribution Centres in Belgium and Austria,
Twin Sport in the Netherlands, the Baltics & Asia e-commerce offerings,
the MySale business in Australia, and all non-UK based wholesale and licensing
activities (relating to brands such as Everlast and Slazenger).
· Property
This segment includes the results from the Group's freehold property owning
and long leasehold holding property companies and the associated property,
plant and equipment that generate third party rental, other property related
income (e.g. car parking, conference and events income). The results of the
Coventry Arena are reported in this segment. The depreciation of freehold and
long leasehold owner-occupied properties is also reported in this segment.
· Financial Services
This segment includes the result of Frasers Group Financial Services. This
includes interest charged on amounts advanced to consumer credit customers,
along with the associated impairment and operating costs.
The operating performance of each segment is assessed by reference to revenue,
gross margin, and profit from trading activities after operating expenses. For
the avoidance of doubt, operating costs in the Group's three retail operating
segments include rents payable to third party landlords. Intra-group rent
payments are eliminated on consolidation.
For the property segment, profit from trading activities includes fair value
gains and losses in respect of investment properties (see further below) and
gains or losses on disposal of properties since the Group's property
businesses seek to generate income from rentals and capital appreciation of
properties held.
In the Financial Services segment, impairment losses on consumer credit
receivables are disclosed within gross margin, which management deem to be the
appropriate treatment for a financial services business.
Depreciation, amortisation and impairments (net of any reversals) are
disclosed as part of each segment's operating profit/(loss).
Net investment and finance income and costs are not split by segment as
management consider that these items relate to the Group as a whole and any
split would not be meaningful.
Segmental information for the 52 weeks ended 27 April 2025:
UK Sports Premium lifestyle International Retail Property Financial Services Group
Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Revenue 2,698.1 1,048.2 1,007.4 4,753.7 86.6 85.3 4,925.6
Cost of sales (1,398.5) (635.4) (553.6) (2,587.5) (9.6) (22.1) (2,619.2)
Gross profit 1,299.6 412.8 453.8 2,166.2 77.0 63.2 2,306.4
Gross Margin % 48.2% 39.4% 45.0% 45.6% 88.9% 74.1% 46.8%
Operating costs (823.8) (255.4) (339.7) (1,418.9) (46.6) (45.7) (1,511.2)
Fair value adjustments to investment properties - - - - 13.1 - 13.1
Profit on disposal of properties - - - - 0.6 - 0.6
Profit from trading 475.8 157.4 114.1 747.3 44.1 17.5 808.9
Depreciation & amortisation (134.3) (27.2) (69.3) (230.8) (44.2) (0.4) (275.4)
Impairments net of impairment reversals 5.0 1.8 (1.8) 5.0 4.6 - 9.6
Share-based payments (0.8) - - (0.8) - - (0.8)
Foreign exchange realised 19.8 (0.1) (4.9) 14.8 - (0.1) 14.7
Operating profit 365.5 131.9 38.1 535.5 4.5 17.0 557.0
Profit on sale of subsidiaries 4.3
Share of profit of associated undertakings 2.0
Net investment costs (30.3)
Net finance costs (153.6)
Profit before tax 379.4
Profit from discontinued operations 6.3
Fair value adjustment to derivative financial instruments 46.8
Fair value losses on equity derivatives 141.6
Realised FX gain (14.7)
Share-based payments 0.8
Adjusted profit before tax ("APBT") 560.2
Revenue from external customers in Frasers Group Financial Services Limited
includes credit account interest of £85.3m (FY24: £111.0m), and gross profit
includes impairment losses on credit customer receivables of £22.1m (FY24:
£20.6m), both of which are recognised in the Financial Services segment.
Other segmental items included in the income statement for the 52 weeks ended
27 April 2025:
UK Sports Premium lifestyle International Retail Property Financial Services Group Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Property, plant & equipment depreciation (85.8) (24.0) (27.9) (137.7) (44.2) (0.4) (182.3)
Property, plant & equipment (impairment)/reversals (1.2) - - (1.2) 4.6 - 3.4
IFRS 16 ROU depreciation (47.2) (3.2) (39.2) (89.6) - - (89.6)
IFRS 16 ROU (impairment)/reversals 6.2 1.8 (1.8) 6.2 - - 6.2
Fair value adjustments to investment properties - - - - 13.1 - 13.1
IFRS 16 disposal and modification/remeasurement of lease liabilities 9.6 0.8 (0.7) 9.7 - - 9.7
Intangible amortisation (1.3) - (2.2) (3.5) - - (3.5)
Segmental information for the 52 weeks ended 28 April 2024((1))
UK Sports Premium lifestyle International Retail Property Financial Services Group
Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Revenue 2,908.9 1,229.8 994.6 5,133.3 72.7 111.0 5,317.0
Cost of sales (1,558.5) (773.2) (547.7) (2,879.4) (7.8) (20.6) (2,907.8)
Gross profit 1,350.4 456.6 446.9 2,253.9 64.9 90.4 2,409.2
Gross Margin % 46.4% 37.1% 44.9% 43.9% 89.3% 81.4% 45.3%
Operating costs (882.0) (319.4) (319.7) (1,521.1) (40.8) (32.8) (1,594.7)
Fair value adjustments to investment properties - - - - 11.5 - 11.5
Profit on disposal of properties - - - - 3.5 - 3.5
Profit from trading 468.4 137.2 127.2 732.8 39.1 57.6 829.5
Depreciation & amortisation (109.9) (36.4) (76.5) (222.8) (60.2) (1.5) (284.5)
Impairments net of impairment reversals 8.4 (2.5) (12.5) (6.6) (14.8) - (21.4)
Share-based payments (23.0) - (0.4) (23.4) - - (23.4)
Foreign exchange realised 9.2 0.3 0.3 9.8 4.6 - 14.4
Operating profit/(loss) 353.1 98.6 38.1 489.8 (31.3) 56.1 514.6
Profit on sale of subsidiaries/discontinued operations 25.0
Net investment income 9.5
Net finance costs (48.1)
Profit before tax 501.0
Loss from discontinued operations (6.5)
Fair value adjustment to derivative financial instruments (27.6)
Fair value losses on equity derivatives 68.9
Realised FX gain (14.4)
Share-based payments 23.4
Adjusted profit before tax ("APBT") 544.8
((1) Restated to reflect the classification of the results of Game Spain as a
discontinued operation and the reclassification of delivery income and costs
associated with free-issue gift vouchers from selling, distribution and
administrative expenses to revenue.) ( Please refer to note 1 for further
information.)
Other segmental items included in the income statement for the 52 weeks ended
28 April 2024:
UK Sports Premium lifestyle International Retail Property Financial Services Group Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Property, plant & equipment depreciation (68.7) (26.9) (41.6) (137.2) (60.2) (2.1) (199.5)
Property, plant & equipment impairment (3.0) 3.0 (4.9) (4.9) (14.8) - (19.7)
IFRS 16 ROU depreciation (40.7) (9.5) (33.6) (83.8) - 0.6 (83.2)
IFRS 16 ROU (impairment)/reversals 11.9 (0.3) (6.4) 5.2 - - 5.2
Fair value adjustments to investment properties - - - - 11.5 - 11.5
IFRS 16 disposal and modification/remeasurement of lease liabilities (2.1) 4.9 (9.4) (6.6) - - (6.6)
Intangible amortisation (0.5) - (1.3) (1.8) - - (1.8)
Intangible impairment (0.5) (5.2) (1.2) (6.9) - - (6.9)
4. INVESTMENT INCOME
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Premium received on equity derivatives 105.5 76.1
Dividend income 5.8 2.3
111.3 78.4
The premium received on equity derivatives mainly relates to written Hugo Boss
options.
5. INVESTMENT COSTS
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Loss on disposal of equity derivatives 91.8 36.5
Fair value loss on equity derivatives 49.8 32.4
141.6 68.9
The loss on equity derivatives relates to losses across the strategic
investments portfolio including Hugo Boss.
The net fair value loss on equity derivatives in the current period was
£36.1m (FY24: net fair value gain of £7.2m).
6. FINANCE INCOME
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Bank interest receivable 17.1 15.8
Fair value adjustment to derivatives* 12.1 27.6
29.2 43.4
*Includes £12.1m (FY24: £6.1m) from interest rate swaps.
7. FINANCE COSTS
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Interest on bank loans and overdrafts 89.4 66.8
Fair value adjustment to derivatives 58.9 -
IFRS 16 lease interest 25.6 24.3
Interest on retirement benefit obligations 0.2 -
Other interest 8.7 0.4
182.8 91.5
8. TAXATION
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Current tax 103.1 127.5
Adjustment in respect to prior periods - (8.9)
Total current tax 103.1 118.6
Deferred tax (3.7) (0.7)
Adjustment in respect of prior periods (6.7) (10.0)
Total deferred tax (10.4) (10.7)
92.7 107.9
Profit before taxation - continuing operations 379.4 501.0
Profit/(loss) before taxation - discontinued operations 6.3 (6.5)
Total profit before taxation 385.7 494.5
Taxation at the standard rate of tax in the UK of 25% (2024: 25%) 96.4 123.6
Non-taxable income (25.5) (23.5)
Expenses not deductible for tax purposes 34.6 34.3
Other tax adjustments (6.1) (7.6)
Adjustments in respect of prior periods - current tax - (8.9)
Adjustments in respect of prior periods - deferred tax (6.7) (10.0)
92.7 107.9
Tax charge - continuing operations 92.7 107.9
Tax charge - discontinued operations - -
Total tax charge 92.7 107.9
Expenses not deductible for tax purposes largely relates to non-qualifying
depreciation and impairments not qualifying for tax allowances and current
year losses where no taxation credit is recognised. Non-taxable income largely
relates to impairment reversals, gains on disposal of subsidiaries and fair
value gain on investment properties.
9. EARNINGS PER SHARE FROM TOTAL AND CONTINUING OPERATIONS ATTRIBUTABLE TO THE
EQUITY SHAREHOLDERS
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders of the parent by the weighted average number of
ordinary shares outstanding during the year.
For diluted earnings per share, the weighted average number of shares,
432,929,122 (FY24: 438,504,703), is adjusted to assume conversion of all
dilutive potential ordinary shares under the Group's share schemes, being nil
(FY24: nil), to give the diluted weighted average number of shares of
432,929,122 (FY24: 438,504,703). There is therefore no difference between the
Basic and Diluted EPS calculations for both periods. Shares bought back into
treasury are deducted when calculating the weighted average number of shares
below.
Basic and Diluted Earnings Per Share
52 weeks ended 52 weeks ended 52 weeks ended 52 weeks ended 52 weeks ended 52 weeks
ended
27 April 2025 27 April 2025 27 April 2025 28 April 2024 (restated)((1)) 28 April 2024 (restated)((1)) 28 April 2024 (restated)((1))
Basic and diluted, continuing operations Basic and diluted, discontinued operations Basic and diluted, total Basic and diluted, continuing operations Basic and diluted, discontinued operations Basic and diluted, total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Profit for the period 285.8 6.3 292.1 387.3 (6.5) 380.8
Number in thousands Number in thousands Number in thousands Number in thousands Number in thousands Number in thousands
Weighted average number of shares 432,929 432,929 432,929 438,505 438,505 438,505
Pence per share Pence per share Pence per share Pence per share Pence per share Pence per share
Earnings per share 66.0 1.5 67.5 88.3 (1.5) 86.8
((1) Restated to reflect the change in entities classified as discontinued
operations and reclassification of carriage income. Please refer to note 1 for
further information.)
Adjusted Earnings Per Share
The adjusted earnings per share reflects the underlying performance of the
business compared with the prior period and is calculated by dividing adjusted
earnings by the weighted average number of shares for the period. Adjusted
earnings is used by management as a measure of profitability within the Group.
Adjusted earnings is defined as profit for the period attributable to equity
holders of the parent for each financial period but excluding the post-tax
effect of certain non-trading items. Tax has been calculated with reference to
the effective rate of tax for the Group.
The Directors believe that the adjusted earnings and adjusted earnings per
share measures provide additional useful information for shareholders on the
underlying performance of the business and are consistent with how business
performance is measured internally. Adjusted earnings is not a recognised
profit measure under IFRS and may not be directly comparable with adjusted
profit measures used by other companies.
52 weeks ended 52 weeks ended 52 weeks ended 52 weeks ended
27 April 2025 27 April 2025 28 April 2024 28 April 2024
Basic Diluted Basic Diluted
(£'m) (£'m) (£'m) (£'m)
Profit for the period 292.1 292.1 380.8 380.8
Pre-tax adjustments to profit for the period for the following items:
Fair value adjustment to derivatives included within finance (income)/costs 46.8 46.8 (27.6) (27.6)
Fair value losses and loss on disposal of equity derivatives 141.6 141.6 68.9 68.9
Realised foreign exchange gains (14.7) (14.7) (14.4) (14.4)
Share based payments 0.8 0.8 23.4 23.4
Tax adjustments on the above items (41.9) (41.9) (11.0) (11.0)
Adjusted profit for the period 424.7 424.7 420.1 420.1
Number in thousands Number in thousands Number in thousands Number in thousands
Weighted average number of shares 432,929 432,929 438,505 438,505
Pence per share Pence per share Pence per share Pence per share
Adjusted Earnings per share 98.1 98.1 95.8 95.8
10. DISCONTINUED OPERATIONS AND SALE OF SUBSIDIARIES
Discontinued operations - Game Spain
On 19 March 2025, the Group sold Game Spain by way of selling the entire share
capital of Game Spain Iberia, SL to Guidebridge Opportunities 4, S.L.
following approval from the competition authority. Cash consideration for the
sale amounted to EUR 25m, with EUR 15m (£12.7m) being received upon
completion a further EUR 10m (approx. £7.0m) being paid in two €5m
instalments in FY26 and FY27, respectively.
In accordance with IFRS 5.32, management considered that Game Spain
constituted a separate major line of business that had been disposed of and
that it therefore met the criteria to be classified as a discontinued
operation. A loss on disposal of £11.8m was recognised in the consolidated
income statement in the current year.
52 weeks ended
27 April 2025
(£'m)
Total disposal consideration 19.7
Carrying amount of net assets disposed of (31.5)
Loss on disposal after income tax (11.8)
29 April 2024 to
19 March 2025
(£'m)
Revenue 223.5
Expenses (218.6)
Profit after tax of discontinued operation 4.9
Loss on disposal (11.8)
Loss from discontinued operation (6.9)
Net cash inflow from operating activities 3.9
Net cash inflow from investing activities 6.0
Net cash outflow from financing activities (4.9)
Net increase in cash and cash equivalents generated by the discontinued 5.0
operation
The carrying amounts of assets and liabilities at the date of disposal on 19
March 2025 were as follows:
(£'m)
Tangible assets 0.8
Inventories 38.8
Trade and other receivables 7.5
Cash and cash equivalents 6.3
Deferred tax asset 0.7
Corporation tax 2.6
Total assets 56.7
Trade and other payables (18.8)
Provisions (6.4)
Total liabilities (25.2)
Net assets of the disposal group 31.5
Discontinued operations - Matches
On 20 December 2023, the Group acquired the Matches business ("Matches") from
MF Intermediate Limited, by way of the purchase of 100% of the shares of a
group of 6 companies (of which MatchesFashion Limited was the main trading
subsidiary) and the acquisition of the senior and junior debt owed by those
companies. The consideration payable was £51.9m.
Following the acquisition, the Group provided significant funding to Matches
but the business continued to generate material trading losses. As a result of
this, management concluded that the funding requirements of the business would
be far in excess of amounts that the Group considered to be viable and on 8
March 2024 administrators were appointed. From this point, the Group was no
longer exposed to and no longer had rights to variable returns from Matches
and lost its ability to influence these returns through its power over the
entity. Therefore, in accordance with IFRS 10 Consolidated Financial
Statements ("IFRS 10") management concluded that it no longer had control over
Matches.
Details of the disposal
52 weeks ended
28 April 2024
Total disposal consideration 74.7
Carrying amount of net assets disposed of (78.8)
Loss on disposal after income tax (4.1)
All amounts are attributable to the owners of the parent.
Total disposal consideration of £74.7m reflects loans due to the Group from
Matches at the point of disposal, net of a provision for expected credit loss.
In the prior period, between the administrators' appointment and 28 April
2024, the Group purchased the brand names and intellectual property of Matches
for £20.0m, with the consideration payable being treated as a reduction in
the amounts owed to the Group by Matches.
A first dividend of £30.0m was also received from the administrators prior to
year-end leaving an outstanding balance of £24.7m at 28 April 2024, which was
recorded within trade and other receivables.
In the current period, a further £14.3m has been received from the
administrators over and above the £24.7m assumed at prior year-end, net of
costs of £1.1m, resulting in a net gain of £13.2m. This gain is presented
within the result from discontinued operations.
Financial performance and cash flow information
52 weeks ended 20 December 2023 to
27 April 2025 28 April 2024
(£'m) (£'m)
Revenue - 29.9
Expenses - (38.3)
Loss after tax of discontinued operation - (8.4)
Loss on disposal - (4.1)
Further dividends received from administrators 13.2 -
Gain/(loss) from discontinued operation 13.2 (12.5)
Net cash outflow from operating activities - (9.1)
Net cash outflow from investing activities - (5.3)
Net cash inflow from financing activities* 13.2 -
Net increase/(decrease) in cash generated by the discontinued operation 13.2 (14.4)
*Dividend received reflects repayment of secured debt.
The carrying amounts of assets and liabilities at the date of disposal on 8
March 2024 were as follows:
(£'m)
Goodwill 1.9
Intangible assets 20.0
Inventories 73.9
Trade and other receivables 34.9
Cash and cash equivalents 20.0
Total assets 150.7
Trade and other payables (45.8)
Provisions (12.3)
Lease liabilities (13.8)
Total liabilities (71.9)
Net assets of the disposal group 78.8
Disposal of subsidiaries
The current year result includes a £4.3m gain on disposal of subsidiaries
which reflects small gains from the disposal non-core subsidiaries and
intellectual property (such as Karrimor Japan and Nicholas Deakins), none of
which warranted separate presentation as discontinued operations. Total
consideration received in this regard was approximately £12m.
In the prior period the Group sold certain intellectual property assets
relating to Missguided for net consideration of approximately £25.0m.
11. PROPERTY, PLANT AND EQUIPMENT
Right of use assets Freehold land and Buildings Long-term Leaseholds Short-term leasehold improvements Plant and Equipment Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
COST
At 30 April 2023 736.6 926.6 143.7 126.5 1,231.9 3,165.3
Additions 81.3 15.5 6.8 - 169.4 273.0
Eliminated on disposals (75.1) (16.5) (2.1) (14.7) (96.0) (204.4)
Reclassifications / Remeasurements 15.2 (83.9) (3.0) - (10.6) (82.3)
Exchange differences (2.6) (3.3) (0.4) (0.5) (5.2) (12.0)
At 28 April 2024 755.4 838.4 145 111.3 1,289.5 3,139.6
Acquisitions 19.1 0.8 9.1 - - 29.0
Additions 108.9 55.4 9.7 - 178.6 352.6
Eliminated on disposals (101.9) (12.0) (8.9) - (36.6) (159.4)
Reclassifications / Remeasurements 23.3 14.4 2.2 - (0.4) 39.5
Exchange differences (6.5) (2.9) 1.7 (0.2) 46.1 38.2
At 27 April 2025 798.3 894.1 158.8 111.1 1,477.2 3,439.5
ACCUMULATED DEPRECIATION AND IMPAIRMENT
At 30 April 2023 (508.8) (467.0) (63.3) (124.3) (869.9) (2,033.3)
Charge for the period (83.2) (17.4) (17.4) (0.1) (164.7) (282.8)
(Impairment)/reversal 5.2 6.8 (6.7) - (19.8) (14.5)
Eliminated on disposals 75.1 4.4 3.0 14.1 32.0 128.6
Reclassifications / Remeasurements (3.4) 12.7 (3.7) 0.2 8.9 14.7
Exchange differences 5.1 0.6 0.2 0.4 4.0 10.3
At 28 April 2024 (510.0) (459.9) (87.9) (109.7) (1,009.5) (2,177.0)
Charge for the period (89.6) (32.1) (6.3) - (143.9) (271.9)
(Impairment)/reversal 6.2 2.7 0.7 - - 9.6
Eliminated on disposals 101.3 4.2 0.6 - 32.8 138.9
Reclassifications / Remeasurements - 2.2 - - 0.3 2.5
Exchange differences 2.4 3.5 (2.6) 0.2 (47.9) (44.4)
At 27 April 2025 (489.7) (479.4) (95.5) (109.5) (1,168.2) (2,342.3)
NET BOOK VALUE
At 27 April 2025 308.6 414.7 63.3 1.6 309.0 1,097.2
At 28 April 2024 245.4 378.5 57.1 1.6 280.0 962.6
12. INVESTMENT PROPERTIES
Freehold land and Buildings
(£'m)
Fair value at 30 April 2023 160.0
Lease liabilities on ground leases brought forward (18.7)
Direct acquisitions 99.2
Less right-of-use asset additions (23.7)
Transfer from property, plant and equipment - at fair value 79.4
Net gain from fair value adjustment on investment properties 11.5
Market value per valuation report 307.7
Lease liabilities on ground leases 42.8
Fair value at 28 April 2024 350.5
Lease liabilities on ground leases brought forward (42.8)
Direct acquisitions 168.9
Capitalised subsequent expenditure 3.7
Less right-of-use asset additions (4.6)
Transfer from property, plant and equipment - at fair value 6.2
Net gain from fair value adjustment on investment properties 13.1
Transfer to property, plant and equipment - at fair value (25.0)
Disposals (4.0)
Market value per valuation report 466.0
Lease liabilities on ground leases 47.3
Fair value at 27 April 2025 513.3
The rental income from Investment Properties recognised in the consolidated
income statement for the year was £44.7m (FY24: £38.7m).
Valuation processes
The Group's investment properties were valued as at 27 April 2025 by the
Group's internal property team who are appropriately qualified chartered
surveyors, follow the applicable valuation methodology of the Royal Institute
of Chartered Surveyors, and have recent experience in the locations and
segments of the investment properties valued. For all investment properties,
their current use equates to the highest and best use. The Group's finance
department includes a team that reviews the valuations performed by the
property team for financial reporting purposes. This team reports directly to
the Chief Financial Officer (CFO) and the Audit Committee (AC). Discussions of
valuation processes and results are held between the finance department and
the property team in August and February each year, and as part of the
year-end process.
At each financial discussion, the finance department verifies all major inputs
to the valuation report and assesses property valuation movements when
compared to the previous valuation report.
Measurement of fair value of investment property
Properties valued by the Group's internal property team are valued on an open
market basis based on active market prices adjusted for any differences in the
nature, location or condition of the specified asset such as plot size,
encumbrances and current use. If this information is not available,
alternative valuation methods are used such as recent prices on less active
markets, or discounted cashflow projections. The significant unobservable
input is the adjustment for factors specific to the properties in question.
The extent and direction of this adjustment depends on the number and
characteristics of the observable market transactions in similar properties
that are used as the starting point for the valuation. Although this input is
a subjective judgement, management consider that the overall valuation would
not be materially altered by any reasonable alternative assumptions. All of
the valuations across the Group's investment property are considered to be
level 3 fair values.
The market value of the investment properties has been supported by comparison
to that produced under income capitalisation techniques applying yield and
estimated rental values as key unobservable inputs. The range of yield applied
is 6.7% to 18.0%.
The fair value of an investment property reflects, among other things, rental
income from current leases and assumptions about future rental lease income
based on current market conditions and anticipated plans for the property
The table below summarises the key unobservable inputs used in the valuation
of the Group's investment properties at 27 April 2025:
Estimated rental value Yield
£ per sq ft %
High 61.6 18.0%
Average 16.2 10.4%
Low 10.8 6.7%
Sensitivities
The sensitivities below illustrate the impact of changes in key unobservable
inputs (in isolation) on the fair value of the Group's properties:
Impact on valuations of 5% change in estimated rental value Impact on valuations of 50 bps change in yield
Market value Increase Decrease Decrease Increase
£m £m £m £m £m
466.0 18.3 (18.3) 16.2 (14.5)
13. INTANGIBLE ASSETS
Goodwill Trademarks and licenses Brands Customer related Total
(£'m) (£'m) (£'m) (£'m) (£'m)
COST
At 30 April 2023 214.7 101.8 88.8 5.7 411.0
Acquisitions 4.2 20.0 - - 24.2
Additions - 25.0 - - 25.0
Disposals (1.9) (20.0) - - (21.9)
Exchange adjustments - (0.1) 0.3 - 0.2
At 28 April 2024 217.0 126.7 89.1 5.7 438.5
Acquisitions 20.5 0.8 - - 21.3
Disposals (6.0) (14.2) - - (20.2)
Exchange adjustments (6.4) (0.5) (4.7) - (11.6)
At 27 April 2025 225.1 112.8 84.4 5.7 428.0
AMORTISATION AND IMPAIRMENT
At 30 April 2023 (204.8) (97.9) (78.5) (5.7) (386.9)
Amortisation charge - (0.5) (1.3) - (1.8)
Impairment (2.3) (4.6) - - (6.9)
Disposals - - - - -
Exchange adjustments - (0.4) (0.3) - (0.7)
At 28 April 2024 (207.1) (103.4) (80.1) (5.7) (396.3)
Amortisation charge - (2.0) (1.5) - (3.5)
Disposals 6.0 13.4 - - 19.4
Exchange adjustments 6.4 0.4 4.1 - 10.9
At 27 April 2025 (194.7) (91.6) (77.5) (5.7) (369.5)
At 27 April 2025 30.4 21.2 6.9 - 58.5
At 28 April 2024 9.9 23.3 9.0 - 42.2
Amortisation is charged to selling, distribution and administrative expenses
in the Consolidated Income Statement.
Goodwill, trademarks and licenses and brands that are acquired in a business
combination are allocated, at acquisition, to the CGUs that are
expected to benefit from that business combination. After recognition of
impairment losses, the carrying amount of these assets at the start and end of
the current period are allocated as follows:
27 April 2025
Goodwill Trademarks and licenses Brands Total
(£'m) (£'m) (£'m) (£'m)
Wholesale & Licensing (excl. Everlast) 9.9 - - 9.9
Everlast - 2.5 6.9 9.4
Matches - 18.7 - 18.7
Twin Sport 20.5 - - 20.5
30.4 21.2 6.9 58.5
28 April 2024
Goodwill Trademarks and licenses Brands Total
(£'m) (£'m) (£'m) (£'m)
Wholesale & Licensing (excl. Everlast) 9.9 - - 9.9
Everlast - 3.0 9.0 12.0
Matches - 20.0 - 20.0
9.9 23.0 9.0 41.9
Acquisitions
In the current period, goodwill and trademarks with a fair value of £21.3m
(FY24: £24.2m) were recognised as part of business combinations, with £21.3m
relating to the Twin Sport acquisition.
In the prior year, the goodwill and trademarks recognised in respect of
Matches were derecognised once the business went into administration on 8
March 2024.
Additions
In the prior period, the Group purchased the brand names and intellectual
property of Matches for £20.0m. The assets acquired were assumed to have a
useful economic life of 15 years. Management does not consider that there was
any indicator of impairment at the reporting date.
Amortisation
The brands, trademarks & licenses allocated to the Everlast CGU are being
amortised over a 15-year period. The amortisation charge in the current period
is £1.5m (FY24: £1.3m) and is disclosed within selling, distribution and
administrative expenses in the Consolidated Income Statement. The remaining
useful economic life of these assets is 9 years (FY24: 10 years).
Impairment review
The Group tests the carrying amount of goodwill and intangible assets with an
indefinite life for impairment annually or more frequently if there are
indications that their carrying value might be impaired. The carrying amounts
of other intangible assets are reviewed for impairment if there is an
indicator of impairment.
The recoverable amounts of the Wholesale & Licensing (excl. Everlast),
Everlast and Twin Sport CGUs have been determined by reference to value in use
calculations. The recoverable amounts were then compared to the carrying value
of the assets allocated to each CGU to assess the level impairment required,
if any.
No impairment testing was performed on the intellectual property purchased
from Matches due to the absence of any indicator.
Significant judgements, assumptions, and estimates
In determining the value in use of CGUs it is necessary to make a series of
assumptions to estimate the present value of future cash flows. In each case,
these key assumptions have been made by management reflecting past experience,
current trends, and where applicable, are consistent with relevant external
sources of information. The key assumptions are as follows:
27 April 2025 28 April 2024
Wholesale & Licensing (excl. Everlast) Everlast Twin Sport Wholesale & Licensing (excl. Everlast) Everlast
5-year average annual forecast sales growth/(decline) (1.0%) 1.5% 5.2% (1.7%) (1.8%)
Discount rate 10.9% 13.0% 10.9% 9.8% 13.5%
Annual % increase/(decrease) in operating costs 0.0% (3.3%) 1.6% 0.0% 0.0%
Terminal growth rate 1.1% 1.8% 1.4% 2.0% 2.0%
Management has prepared cash flow forecasts for a five-year period derived
from the actual results for financial year 2024/25. These forecasts include
assumptions around sales prices and volumes, specific customer relationships
and operating costs and working capital movements.
The average rate of annual sales growth forecast for the Everlast CGU of 1.5%
pa is an improvement on the 1.8% pa decline in the prior year and is
reflective of management's latest view of the business' prospects in the
medium-term due to current restructuring underway.
The pre-tax rates used to discount the forecast cash flows are shown above and
are derived from the Group's weighted average cost of capital as adjusted for
the specific risks related to each CGU.
Overhead costs in the Everlast CGU have been assumed to decrease (FY24: flat)
throughout the forecast period on the basis that inflationary cost increases
will be offset by operational efficiencies due to current restructuring
underway.
To forecast beyond the detailed cash flows into perpetuity, a long-term
average growth rate of 1.1% for the Wholesale & Licensing (excluding
Everlast) CGU (FY24: 2.0%), 1.8% for the Everlast CGU (FY24: 2.0%) and 1.4%
for the Twin Sport CGU has been used. This is not greater than the published
International Monetary Fund average growth rate in gross domestic product for
the next five-year period in the territories where the CGUs operate.
Results
The recoverable amount of the Wholesale & Licensing (excluding Everlast)
CGU exceeds its carrying value by approximately £71.8m (FY24: £72.7m) and as
such no impairment was required.
The recoverable amount of the Everlast CGU exceeds its carrying value by
approximately £5.3m (FY24: £9.0m) and as such no impairment was required.
The recoverable amount of the Twin Sport CGU exceeds its carrying value by
approximately £7.9m and as such no impairment was required.
Sensitivity Analysis
The table below shows changes to the terminal growth rate, risk adjusted
discount rate and forecast operating cash flow assumptions used in the
calculation of value in use for the Everlast and Twin Sport CGUs to make
recoverable amount of CGU equal to its carrying value:
Everlast Twin Sport
Value in use £31.4m £36.7m
Current headroom £5.3m £7.9m
Change in key assumption required to make recoverable amount of CGU equal to
its carrying value
Current Terminal Growth Rate 1.8% 1.4%
Revised Terminal Rate of Decline (0.7%) (1.8%)
Current Discount Rate 13.0% 10.9%
Revised Discount Rate 15.2% 13.9%
Current 5-year average annual forecast sales growth 1.0% 5.7%
Revised 5-year average annual forecast sales decline (5.5%) (6.4%)
Current annual % decrease in operating costs (3.3%) (1.2%)
Revised annual % increase in operating costs 3.6% 5.9%
Based on the results of the impairment test for the Wholesale & Licensing
(excluding Everlast) CGU and the immaterial carrying value of the remaining
goodwill, management are satisfied that there is sufficient headroom against
the carrying value such that a reasonably possible change in assumption would
not lead to an impairment. Consequently, no sensitivity analysis has been
disclosed for this CGU.
Climate Change
Management considered the impact of climate change when conducting its
impairment review and concluded that it was unlikely to have a material impact
on the assumptions based on the following:
· The relevant tangible assets have relatively short useful
economic lives and are not considered to be in locations that will be
materially impacted by climate change (i.e., they are in the USA and the
Netherlands - developed countries).
· The forecasts include estimates for ongoing capital expenditure,
which management consider to be sufficient to make any essential climate
change related acquisitions (e.g., solar panels or building energy management
systems).
14. LONG-TERM FINANCIAL ASSETS
The Group is not looking to make gains through increases in market prices of
its long-term financial assets, therefore on initial application of IFRS 9 the
Group made the irrevocable election to account for long term financial assets
at fair value through other comprehensive income (FVOCI). The election has
been made on an instrument-by-instrument basis, only qualifying dividend
income is recognised in profit and loss, changes in fair value are recognised
within OCI and never reclassified to profit and loss, even if the asset is
impaired, sold or otherwise derecognised. All of the Group's long-term
financial assets are recognised in the UK Sports segment.
The fair value of the long-term financial assets is based on bid quoted market
prices at the balance sheet date or where market prices are not available, at
management's estimate of fair value.
The following table shows the aggregate movement in the Group's financial
assets during the period:
27 April 2025 28 April 2024
(£'m) (£'m)
At beginning of period 495.4 289.6
Additions 740.2 382.6
Disposals (126.9) (133.3)
Amounts recognised through other comprehensive income (149.6) (43.7)
Exchange differences - 0.2
959.1 495.4
Included within long-term financial assets at the period ended 27 April 2025
are the following direct interests held by the Group:
• 40.83% (FY24: 31.1%) interest in XXL ASA
• 37.05% (FY24: 36.9%) interest in Mulberry Group Plc
• 29.7% (FY24: 22.7%) interest in Boohoo Group Plc
• 25.12% (FY24: 24.5%) interest in AO World Plc
• 21.95% (FY24: 20.2%) interest in ASOS Plc
• 19.25% (FY24: 0.99%) interest in Hugo Boss AG
• 14.57% (FY24: Nil%) interest in Accent Group Ltd
• 11.17% (FY24: 0.6%) interest in THG Plc
• 10.75% (FY24: 1.24%) interest in Marks Electrical Group Plc
• 9.68% (FY24: 9.3%) interest in Hornby Plc
• Various other interests, none of which represent more than 5.0%
of the voting power of the investee
The following table shows the fair value of each of the Group's long-term
financial assets (all listed):
27 April 2025 28 April 2024
(£'m) (£'m)
Hugo Boss AG 413.7 30.6
AO World plc 138.5 150.1
Boohoo Group plc 94.6 98.4
ASOS plc 76.9 83.1
Accent Group Ltd 71.4 -
THG plc 44.4 0.5
Mulberry Group plc 21.5 23.8
XXL ASA 21.2 31.9
Marks Electrical Group plc 6.5 0.9
Hornby plc 2.4 5.2
N Brown Group plc - 13.4
Currys plc - 46.1
Other 68.0 11.4
At end of period 959.1 495.4
*Other relates to interests which do not represent more than 5.0% of the
voting power of the investee as at 27 April 2025.
During the period the Group disposed of long-term financial assets with a fair
value of £126.9m. These primally relate to its holdings in Currys plc and N
Brown Group plc. In both cases, the Group explored commercial relationship
with the investee's management and, following the completion of such
discussions, was willing to divest at a price that was considered to be
advantageous.
These holdings have been assessed under IFRS 9 Financial Instruments and
categorised as long-term financial assets, as the Group does not consider them
to be associates and therefore, they are not accounted for on an equity basis,
see note 2.
Our strategic investments are intended to allow us to develop relationships
and commercial partnerships with the relevant retailers and brands.
15. TRADE AND OTHER RECEIVABLES
27 April 2025 28 April 2024
(£'m) (£'m)
Gross credit customer receivables 254.9 286.9
Allowance for expected credit loss on credit customer receivables (73.2) (80.7)
Net credit customer receivables 181.7 206.2
Trade receivables 64.9 91.6
Deposits in respect of derivative financial instruments 522.7 139.0
Amounts owed by related parties 7.3 6.6
Other receivables 64.2 128.1
Prepayments 87.0 103.4
927.8 674.9
Further disclosure with regards to the credit customer receivables and the
associated allowance for expected credit loss can be found at the end of this
note.
Trade and other receivables
The Directors consider that the carrying amount of trade and other receivables
approximates to their fair value. The maximum exposure to credit risk at the
reporting date is the carrying value of each class of asset above, plus any
cash balances. Other receivables also include unremitted sales receipts.
Deposits in respect of derivative financial instruments are collateral to
cover margin requirements for derivative transactions held with
counterparties. The collateral requirement changes with the market (which is
dependent on share price, time to maturity, and volatility), the financial
institutions' assessment of the Group's creditworthiness and further purchases
/ sales of underlying investments held. The balance has increased from
£139.0m at 28 April 2024 to £522.7m at 27 April as a result of a combination
of the factors above and an increase in the Group's open option positions at
27 April 2025.
The majority of the Group's trade receivables are held within the Wholesale
& Licensing businesses. Each customer's creditworthiness is assessed
before payment terms are agreed.
Under IFRS 9, the Group has applied the simplified approach to providing for
expected credit losses for trade receivables, using the lifetime expected loss
provision for all trade receivables. To measure the expected credit losses,
trade receivables have been grouped based on credit risk characteristics,
representing management's view of the risk, and the days past due. The credit
quality of assets neither past due nor impaired is considered to be good. The
Group considers a debt to be defaulted at the point when no further amounts
are expected to be recovered. Financial assets are written off when there is
no reasonable expectation of recovery. If recoveries are subsequently made
after receivables have been written off, they are recognised in profit or
loss.
The amounts owed by related parties mostly relates to the group headed by Four
(Holdings) Limited.
Exposure to credit risk of trade receivables:
27 April 2025 28 April 2024
(£'m) (£'m)
Current 19.7 53.7
0-30 days past due 14.3 14.9
30-60 days past due 8.7 4.7
60-90 days past due 3.2 3.3
Over 90 days past due 19.0 15.0
64.9 91.6
The credit quality of assets neither past due nor impaired is considered to be
good.
The movement in loss allowance relating to trade receivables and amounts owed
by related parties can be analysed as follows:
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Opening position 72.8 83.6
Amounts charged to the income statement 6.9 14.3
Amounts written off as uncollectable (0.1) (17.6)
Amounts recovered during the period (20.5) (7.5)
Closing position 59.1 72.8
Included in the below table is the loss allowance movement in amounts due from
related parties as follows:
52 weeks ended 52 weeks ended
27 April 2025 28 April 2024
(£'m) (£'m)
Opening position 37.6 44.0
Amounts (credited)/charged to income statement (5.3) 4.6
Amounts written off as uncollectable - (3.5)
Amounts recovered during the period - (7.5)
Closing position 32.3 37.6
The gross carrying amount of the balance due from related parties is £38.7m
(FY24: £44.0m). The charge in the period was recorded in Selling,
distribution and administrative expenses. £23.5m of the gross amounts due
from related parties balance is due in less than one year with the remaining
being due in more than a one year (FY24: £21.5m due less than one year).
The Group has no significant concentration of credit risk, with exposure
spread over a large number of customers. The loss allowance / charges have
been determined by reference to past default experience, current / forecasted
trading performance and future economic conditions.
Deposits in respect of derivative financial instruments and prepayments are
not considered to be impaired.
Credit Customer Receivables
Certain of the Group's trade receivables are funded through a securitisation
facility that is secured against those receivables. The finance provider will
seek repayment of the finance, as to both principal and interest, only to the
extent that collections from the trade receivables financed allows and the
benefit of additional collections remains with the Group. At the period end,
receivables of £187.1m (FY24: £201.3m) were eligible to be funded via the
securitisation facility, and the facilities utilised were £93.5m (FY24:
£126.8m).
Other information
The Group will undertake a reasonable assessment of the creditworthiness of a
customer before opening a new credit account or significantly increasing the
credit limit on that credit account. The Group will only offer credit limit
increases for those customers that can reasonably be expected to be able to
afford and sustain the increased repayments in line with the affordability and
creditworthiness assessment. There are no customers (FY24: None) who represent
more than 1% of the total balance of the Group's trade receivables.
Where appropriate, the Group will offer forbearance to allow customers
reasonable time to repay the debt. The Group will ensure that the forbearance
option deployed is suitable in light of the customer's circumstances (paying
due regard to current and future personal and financial circumstances). Where
repayment plans are agreed, the Group will ensure that these are affordable to
the customer and that unreasonable or unsustainable amounts are not requested.
At the balance sheet date there were 30,151 accounts (FY24: 25,170) with total
gross balances of £18.0m (FY24: £16.6m) on repayment plans. Provisions are
assessed as detailed above.
During the current period, overdue receivables with a gross value of £28.4m
(FY24: £35.6m) were sold to third party debt collection agencies. As a result
of the sales, the contractual rights to receive the cash flows from these
assets were transferred to the purchasers. Any gain or loss between actual
recovery and expected recovery is reflected within the impairment charge.
Allowance for expected credit loss
The following tables provide information about the exposure to credit risk and
ECLs for trade receivables from individual customers as at 27 April 2025:
27 April 2025 28 April 2024
Trade receivables Trade receivables on forbearance arrangements Total Trade receivables on forbearance arrangements
Trade receivables Total
(£'m) (£'m) (£'m) (£'m) (£'m) (£'m)
Ageing of trade receivables
Not past due 178.2 16.4 194.6 206.7 15.7 222.4
Past due:
0 - 60 days 23.7 1.3 25.0 22.0 0.9 22.9
60 - 120 days 7.5 0.2 7.7 9.3 - 9.3
120+ days 27.5 0.1 27.6 32.3 - 32.3
Gross trade receivables 236.9 18.0 254.9 270.3 16.6 286.9
Allowance for expected credit loss (61.7) (11.5) (73.2) (69.0) (11.7) (80.7)
Carrying value 175.2 6.5 181.7 201.3 4.9 206.2
29 April 2024 to 27 April 2025
Stage 1 Stage 2 Stage 3 Total
(£'m) (£'m) (£'m) (£'m)
Gross trade receivables 157.6 43.4 53.9 254.9
Allowance for doubtful debts:
Opening balance (17.7) (18.9) (44.1) (80.7)
Impairment charge - (6.3) (18.2) (24.5)
Utilisation in period 6.0 7.9 18.1 32.0
Closing balance (11.7) (17.3) (44.2) (73.2)
Carrying value 145.9 26.1 9.7 181.7
1 May 2023 to 28 April 2024
Stage 1 Stage 2 Stage 3 Total
(£'m) (£'m) (£'m) (£'m)
Gross trade receivables 185.6 47.3 54.0 286.9
Allowance for doubtful debts:
Opening balance (17.2) (37.2) (45.7) (100.1)
Impairment (charge)/release (6.9) 5.0 (19.9) (21.8)
Utilisation in period 6.4 13.3 21.5 41.2
Closing balance (17.7) (18.9) (44.1) (80.7)
Carrying value 167.9 28.4 9.9 206.2
Analysis of impairment charge:
29 April 2024 to 27 April 2025 1 May 2023 to 28 April 2024
(£'m) (£'m)
Impairment charge impacting on provision (24.5) (21.8)
Recoveries 4.8 9.5
Other (2.4) (8.3)
Impairment charge (22.1) (20.6)
Sensitivity analysis
Management judgement is required in setting assumptions around probabilities
of default, cash recoveries and the weighting of macro-economic scenarios
applied to the impairment model, which have a material impact on the results
indicated by the model.
A 1% increase/decrease in the probability of default would increase/decrease
the provision amount by approximately £3.8m
A 1% increase in the assumed recoveries rate would result in the impairment
provision decreasing by approximately £3.1m.
Changing the weighting of macro-economic scenarios to a more positive outlook
so that the severe-case scenario's weighting is reduced to 5% and base
increased by 5% to 55% (with upside increasing by 5% to 10% and downside
remaining at 30%) would result in the impairment provision reducing by
approximately £1.2m.
16. BORROWINGS
27 April 2025 28 April 2024
(£'m) (£'m)
Current:
Bank and other loans* 75.0 -
Lease liabilities 109.6 112.5
Non-Current
Bank and other loans 1,118.2 806.2
Lease liabilities 558.2 533.8
1,861.0 1,452.5
* Relates to bilateral loan facilities maturing in less than 12 months.
An analysis of the Group's total borrowings other than bank overdrafts is as
follows:
27 April 2025 28 April 2024
(£'m) (£'m)
Borrowings - sterling 1,193.2 806.2
The Group refinanced its term loan and revolving credit facilities on 2 July
2025. As a result, no covenants will be tested in respect of the period ended
27 April 2025.
Group borrowings (excluding Frasers Group Financial Services Limited) incurred
interest at an average rate of 2.0% (FY24: 2.0%) over the interbank rate of
the country within which the borrowing entity resides. The securitisation loan
relating to Frasers Group Financial Services Limited had a balance at 27 April
2025 of £93.5m (FY24: £126.8m). The average interest rate paid on the
securitisation loan was 6.98% (FY24: 7.02%).
Reconciliation Of Liabilities Arising From Financing Activities
The changes in the Group's liabilities arising from financing activities can
be classified as follows:
Non-current borrowings Current borrowings Total
(£'m) (£'m) (£'m)
At 30 April 2023 1,310.0 119.6 1,429.6
Cash-flows:
- Borrowings drawn down 482.1 - 482.1
- Borrowings repaid (425.6) - (425.6)
Lease liability:
- IFRS 16 Lease Liabilities - cash-flows - (162.8) (162.8)
- IFRS 16 Lease Liabilities - modifications/remeasurements, transfers from (121.3) 133.3 12.0
non-current to current, interest, and foreign exchange adjustments
- IFRS 16 Lease Liabilities - new leases 82.3 21.1 103.4
- IFRS 16 Lease Liabilities - acquired through business combinations 12.5 1.3 13.8
At 28 April 2024 1,340.0 112.5 1,452.5
Cash-flows:
- Borrowings drawn down 1,404.5 75.0 1,479.5
- Borrowings repaid (1,092.5) - (1,092.5)
Lease liability:
- IFRS 16 Lease Liabilities - cash-flows - (142.0) (142.0)
- IFRS 16 Lease Liabilities - modifications/remeasurements, transfers from (81.1) 112.1 31.0
non-current to current, interest, and foreign exchange adjustments
- IFRS 16 Lease Liabilities - new leases 86.4 27.0 113.4
- IFRS 16 Lease Liabilities - acquired through business combinations 19.1 - 19.1
At 27 April 2025 1,676.4 184.6 1,861.0
On 2 July 2025 the Group refinanced its existing borrowings and entered into a
combined term loan and revolving credit facility ("RCF") of £3 billion for a
period of three years, with the possibility to extend this by a further two
years.
The Group continues to operate comfortably within its banking facilities and
covenants and the Board remains comfortable with the Group's available
headroom. The carrying amounts and fair value of the borrowings are not
materially different.
Reconciliation of Net Debt:
27 April 2025 28 April 2024
(£'m) (£'m)
Borrowings (1,861.0) (1,452.5)
Add back:
- Lease liabilities 667.8 646.3
Cash and cash equivalents 252.2 358.6
Net debt (941.0) (447.6)
17. PROVISIONS
Legal and regulatory Property related Financial services related Other Total
(£'m) (£'m) (£'m) (£'m) (£'m)
At 30 April 2023 123.5 166.7 16.0 0.3 306.5
Acquired through business combinations - 12.3 - - 12.3
Amounts provided 24.1 38.5 1.6 2.7 66.9
Amounts utilised / reversed (23.9) (93.4) (9.4) - (126.7)
At 28 April 2024 123.7 124.1 8.2 3.0 259.0
Amounts provided 3.7 30.0 0.5 3.8 38.0
Amounts utilised / reversed (26.1) (40.9) (5.7) (0.7) (73.4)
At 27 April 2025 101.3 113.2 3.0 6.1 223.6
Financial services related and other provisions are categorised as current
liabilities, while legal and regulatory and property related provisions are
non-current.
Legal and regulatory provisions
Legal and regulatory provisions reflect management's best estimate of the potential costs arising
from the settlement of outstanding disputes of a commercial and regulatory
nature.
A substantial portion of the amounts provided relates to ongoing legal claims
and non-UK tax enquiries. In accordance with IAS37.92, management have
concluded that it would prejudice seriously the position of the Group to
provide further specific disclosures in respect of amounts provided for legal
claims and non-UK tax enquiries.
The timing of the outcome of legal claims and non-UK tax inquiries is
dependent on factors outside the Group's control and therefore the timing of
settlement is uncertain. After taking appropriate legal advice, the outcomes
of these claims are not expected to give rise to material loss in excess of
the amounts provided.
Property related provisions
Included within property related provisions are onerous lease provisions and
provisions for dilapidations in respect of the Group's retail stores and
warehouses. Further details of management's estimates are included in note 2.
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