frasers group plc annual report 2022.

ANNUAL

REPORT &

ACCOUNTS

2022.

FRASERS GROUP PLC

ABOUT

FRASERS GROUP

Founded as a single store in

1982, Frasers Group Plc (Frasers

Group, the Group, the business

or the Company) is today the

UK’s largest sporting goods

retailer by revenue.

The Group operates a diversified portfolio of sports,

fitness, premium lifestyle and luxury fascias in over 20

countries. We have more than 30,000 colleagues across

five business segments: UK Sports Retail, Premium

Lifestyle, European Retail, Rest of World Retail and

Wholesale & Licensing.

Our strategy is to provide consumers with access to

the World’s best sports, premium and luxury brands by

providing a World-leading retail ecosystem. Aligned with

this vision, we have defined the Group’s purpose:

To elevate the lives of the many by giving them access to the

World’s best brands and experiences.

OUR IMPACT

SINCE 2007

We became a listed public company in 2007. In

the years since we floated, the Group has greatly

contributed to the British economy. This includes:

£250m

Approx. £250m paid in staff share bonuses

30,000

Have a workforce of approx. 30,000 people

Worldwide, approx. 22,000 of which are in the UK

£2,300m

Contributed approx. £2,300m in VAT and Duty

£200m

Approx. £200m paid in sales commission

to retail bonuses

£700m

Contributed approx. £700m in UK Corporation Tax

£200m

Contributed approx. £200m in NI

employer contributions

GROUP

OUTLOOK

We are delighted to report a record-breaking

year for Frasers Group with an adjusted profit

before tax of £339.8m (FY21: loss £39.9m),

despite the significant economic headwinds and

well-chronicled challenges across the sector.

Our Elevation strategy has remained laser focused,

and we have re-structured our team to execute

it with conviction. It is underpinned by our core

strengths and rock-solid foundations. Although the

backdrop remains challenging, this momentum

gives us the confidence of achieving an adjusted

profit before tax of between £450m and £500m for

the next financial year.

MISSION STATEMENT

TO SERVE OUR CONSUMERS WITH

THE WORLD’S BEST SPORTS,

PREMIUM AND LUXURY BRANDS.

BUSINESS ETHOS

We do not run the business for the short-term

but work to ensure we deliver shareholder value

over the medium to long-term, whilst adopting

accounting principles that are conservative,

consistent and simple.

FRASERS GROUP PLC ANNUAL REPORT 2022

CONTENTS

01. HIGHLIGHTS AND

OVERVIEW

002 About Frasers Group

004 Group at a Glance

006 Financial Highlights

008 Strategic & Operational Highlights

02. STRATEGIC REPORT

010 Chair’s Statement

012 Our Business

014 Our Strategy

016 Key Performance Indicators

018 CEO Report and Business Review

028 Financial Review

031 Non-Financial Information

032 Workers Representative Report

033 ESG Report (Including TCFD)

048 S172 Statement

050 Principal Risks and Uncertainties

063 Viability Statement

03. GOVERNANCE

065 Corporate Governance Report

072 The Board

075 Nomination Committee Report

077 Directors’ Remuneration Report

089 Audit Committee Report

095 Directors’ Report

101 Directors’ Responsibility Statement

04. GROUP FINANCIAL

STATEMENTS

102 Independent Auditor’s Report

to the Members of Frasers Group Plc.

113 Consolidated Income Statement

114 Consolidated Statement of

Comprehensive Income

115 Consolidated Balance Sheet

116 Consolidated Cash Flow Statement

117 Consolidated Statement of

Changes in Equity

118 Notes to the Financial Statements

05. COMPANY FINANCIAL

STATEMENTS

198 Company Balance Sheet

199 Company Statement of Changes in Equity

200 Notes to the Company

Financial Statements

06. GLOSSARY

208 Consolidated Five Year Record and

Alternative Performance Measures

210 Company Directory

211 Shareholder Information

GROUP AT

A GLANCE

UK SPORTS RETAIL EUROPEAN RETAIL

55.0%

Total Group Revenue

16.4%

Total Group Revenue

£2,640.1m £790.2m

0.7% 0.5%

UK Sports Retail includes core sports retail store

operations in the UK, plus all the Group’s sports

retail online business (excluding Bob’s Stores, Eastern

Mountain Sports and Sports Direct Malaysia), the gyms,

SRL, the Group’s Shirebrook campus operations, retail

store operations in Northern Ireland, Evans Cycles and

GAME UK.

Our store footprint is significant, with 808 stores across

the UK, totalling approximately 6.7m sq.ft. of retail

space. The majority of stores are operated under the

Sports Direct, USC, Evans Cycles and GAME fascias.

European Retail includes all the Group’s sports

retail stores, management and operations in

Europe including the Group’s European distribution

centres in Belgium and Austria as well as GAME

Spain. The total European store count is 489 stores

and approximately 3.7m sq.ft. of retail space.

During FY22, management continued to elevate

the Group’s European stores and work to further

tailor the Group’s consumer value propositions to

our local markets.

FRASERS GROUP PLC ANNUAL REPORT 2022

PREMIUM LIFESTYLE

WHOLESALE & LICENSING

The Group’s Premium Lifestyle division offers a broad range of clothing,

footwear and accessories from leading global contemporary and luxury

retail brands through our fascias in the UK: FLANNELS, Cruise, van mildert,

House of Fraser, Sofa.com and Jack Wills along with their related websites.

The majority of these fascias operate as multi-brand premium retail

destinations and are focused on providing fashion conscious consumers

with high-end and on trend products.

The segment is supported by our Group-wide centralised commercial and

support functions, giving the benefits of scale and operating efficiencies

to each fascia. The segment is a significant part of the Group’s new

generation retail concept and as such, in certain locations, Premium and

Lifestyle stores are co-located alongside our Sports retail stores to benefit

from increased customer footfall and operating synergies.

The total Premium Lifestyle store count is 179 stores and approximately

4.0m sq.ft. of retail space.

The Wholesale & Licensing segment operates our globally renowned

heritage Group brands (such as Everlast, Lonsdale, Karrimor and

Slazenger) and our wholesale, licensing and distribution relationships

across the World, as well as our partnerships with third party brands that

we license-in to sell certain products.

The Group’s own brands are managed both individually and centrally within

this segment. This unique, integrated approach to brand management

leverages the expertise of our people, encourages innovation, and

ensures consistency.

REST OF THE WORLD RETAIL

Rest of World Retail includes sports and outdoor retail stores in the US

under the Bob’s Stores and Eastern Mountain Sports fascias and their

corresponding e-commerce offerings. It also includes the Group’s retail

stores in Malaysia, under the Sports Direct fascia, and its corresponding

e-commerce offering. Subsequent to the period end the Bob’s Stores and

Eastern Mountain Sports fascias and their corresponding e-commerce

offerings were disposed of.

As at the period end, the total Rest of World store count is 76 stores and

approximately 1.3m sq.ft. of retail space.

£1,056.6m

1.7%

22.0%

Total

Group Revenue

£150.3m

1.1%

3.1%

Total

Group Revenue

£168.1m

0.7%

3.5%

Total

Group Revenue

FRASERS GROUP PLC ANNUAL REPORT 2022

£335.6m

FINANCIAL HIGHLIGHTS

32.5%

Strong financial performance as we

recover from Covid-19, with Group revenue

up by 32.5%

Excluding acquisitions and on a currency neutral basis,

revenue increased by 31.2%

(1)

Reported profit before

tax was £335.6m, up

3,848.2% from a profit

of £8.5m driven by the

strong reopening of

stores after lockdown,

new FLANNELS stores,

continued growth in online

in the Premium Lifestyle

segment, continued

operating efficiencies, FY21

including Covid-19 related

lockdowns and current

period property related

impairments of £227.0m

compared to £317.0m

in FY21.

Premium Lifestyle revenue increased by

43.6%, largely due to new FLANNELS

stores, continued growth in online, and the

strong reopening of stores after the last

lockdown in March 2021

Excluding acquisitions, revenue increased by 43.3%

(1)

Cash inflow from operating activities

increased to £628.9m compared to

£578.3m in the prior period

43.6%

£628.9m£578.3m

3,848.2%

FRASERS GROUP PLC ANNUAL REPORT 2022

£335.6m

£339.8m

Group adjusted PBT

(2)

increased to £339.8m

compared to a loss of £(39.9m) in the

prior period

Excluding acquisitions and on a currency neutral basis,

Adjusted PBT

(2)

increased by £394.0m

(1)

UK Sports Retail revenue

increased by 34.1%,

largely due to the strong

reopening of stores after

the last lockdown in March

2021 and the comparative

period being impacted by

lockdowns as a result of

Covid-19

Excluding acquisitions, revenue

increased by 30.1%

(1)

European Retail revenue increased by

28.4%, largely due to strong growth in

Ireland and the lockdowns experienced in

the prior year

Excluding acquisitions and on a currency neutral basis,

revenue increased by 33.4%

(1)

As at 24 April 2022 net assets increased to

£1,308.6m from £1,211.0m at 25 April 2021

(1) A reconciliation excluding acquisitions and currency neutral performance

measures can be found in the Glossary.

(2) Adjusted PBT (PBT) is profit before tax less 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. Further detail on this

calculation can be found in the Glossary.

28.4%

£1,308.6m

34.1%

£(39.9m)

FRASERS GROUP PLC ANNUAL REPORT 2022

STRATEGIC AND

OPERATIONAL HIGHLIGHTS

FURTHER GROWTH

Further growth of our key brand partner relationships, alongside establishing new and innovative brand partners

OUR

ELEVATION

STRATEGY

HAS COME

TO LIFE

SPORTS DIRECT BIRMINGHAM

Our Elevation strategy has come to life through the new

store developments, including the creation of flagship

stores, leading to recent openings including Sports Direct

Birmingham and FLANNELS Liverpool

FRASERS GROUP PLC ANNUAL REPORT 2022

Supported our strategic brand partner Hugo Boss AG, with an increased

investment reflecting our growing relationship and confidence in the brand’s future

£193.2m

Returned £193.2m to shareholders through a

significant share buy back program

£980m

Successfully refinanced our Group facility,

which now stands at £980m

UNLOCK

NEW ECOMMERCE

CAPABILITIES

Strategic acquisitions, including Missguided (post period end) and Studio Retail (‘SRL’), enable the

Group to unlock new e-commerce capabilities and access a wider customer base

IMPROVED

THE DIGITAL

CONSUMER

EXPERIENCE

Significantly improved the digital consumer experience across

all touchpoints within the Group

FRASERS GROUP PLC ANNUAL REPORT 2022

CHAIR’S STATEMENT

CEO Appointment

Earlier this year, Michael Murray transitioned into

the role of Chief Executive of Frasers Group and was

formally appointed on 1 May 2022. With Michael’s

leadership, we remain laser focused on the growth of

the business, through keeping up the momentum of our

Elevation strategy, investing in our people and building

out the proposition for brands.

Michael has set out a clear vision for the business -

to provide consumers with access to the World’s best

sports, premium and luxury brands by providing a

World-leading retail ecosystem, and through that, he

has significantly improved our relationships with our key

brand partners and grown our presence across the UK

and Europe, through the development of our

store portfolio.

With the Group’s new leadership, and a clear direction,

Michael continues to redefine the culture, employee

value proposition and strategy of Frasers Group, which

all contribute to the efficiency of the business and our

strong performance.

Business Performance and

Financial Highlights

We are pleased that our business has performed

above expectations since stores reopened in March

2021, following the final period of closure due to the

Covid-19 pandemic. We are a cash generative business

which enables us to continue to invest in our strategies

and withstand some of the pressures and impact of

the pandemic, Brexit, global supply chain challenges

and political and economic uncertainty at home and

abroad. Notwithstanding our business resilience, these

macro-economic factors have contributed to our

conservative judgements and estimates, leading to some

significant non-cash accounting impairments of £232.7m

(FY21: £326.1m) to our asset base, further details can be

found in notes 2, 17, 18 and 19.

• Revenue increased to £4,805.3m (FY21: £3,625.3m)

• Profit Before Tax increased to £335.6m (FY21: £8.5m)

• Adjusted PBT increased to a profit of £339.8m

(FY21: loss £39.9m)

• Net assets at FY22 £1,308.6m (FY21: £1,211.0m)

Looking forward, we will continue to invest in the high

street alongside our online and digital capabilities.

Following the success of the business’s first Sports Direct

flagship on London’s Oxford Street, which opened to

great acclaim last June, we recently opened our second

Sports Direct flagship store in Birmingham – further

demonstrating the strength of our elevated consumer

experience, and the direction of the Sports Direct brand.

The FLANNELS business continues to perform

exceptionally well and we are excited about the recent

opening of our 120,000 sq. ft. FLANNELS flagship store

in Liverpool. The store is our largest store opening to

date and saw an impressive investment of approx. £30m

from the business. Our expansion plans for FLANNELS

are crucial to the on-going success of the luxury side

of the business and through our new brand vision to

become the leading destination for new luxury, we are

delighted to be expanding into new markets and new

locations throughout the UK and Europe, including the

expansion into Ireland with openings planned for Dublin,

Blanchardstown and Cork.

Acquisitions

We continue to see opportunities that strengthen Frasers

Group’s brand proposition and our recent acquisitions of

Studio Retail Limited (with its significant knowledge and

experience in consumer credit) during FY22. Missguided

and I Saw It First (with their focus on womenswear and

its digital platforms) subsequent to the period end are

examples of our drive to expand and acquire businesses

and brands that can strengthen the Group, and our

connection to our consumers.

Operations

We are continually developing our automation

capabilities in our Shirebrook distribution facility,

including the launch of a Dematic Shuttle machine

which covers a floor plate of 200,000 sq. ft and

increasing the size of our AutoStore facility, which was

already the biggest in Europe. In the second half of the

financial year, we completed the purchase of land in

Bitburg, Germany, where we have plans for a significant

distribution centre which will service mainland Europe

from both a store and digital perspective.

Our People

Our people are the key asset to the business.

Under Michael Murray’s leadership, the management

team has been strengthened. The business has created

several new roles including the additions of a Managing

Director of Sports, Ger Wright (formerly a Nike Executive),

and a Managing Director of Luxury and Premium, David

Epstein. Alongside the management team, we will look

to support the business by adding relevant talent and

expertise to the Board when appropriate.

FRASERS GROUP PLC ANNUAL REPORT 2022

This year the Group will receive its third annual intake of

highly talented individuals into the Elevation Programme.

The programme is aimed at high potential graduates

seeking a career in commercial management, and

we have twenty-six (FY20: twenty-seven and FY21:

twenty-five) young, ambitious new joiners who started

in September 2022. Over the past three years, we

have been monitoring the success and benefits of the

Elevation Programme and are pleased to confirm that

we will be rolling out the scheme across our finance

department, which has seen five graduates start in

August 2022.

Sustainability

Sustainability and Elevation go hand in hand and

both are important priorities for the Group and its

stakeholders. We have built a Sustainability Team

structure within the organisation with our CFO

Chris Wootton as the executive sponsor. There are

Sustainability Champions across the business and

hundreds of dedicated people across our stores who

are responsible for helping deliver against our priorities.

We have set ourselves targets to reduce emissions and

single use plastic, and improve our waste management

and recycling. We now offer a carbon neutral delivery

option on the web.

We have outperformed our target of a 10% reduction

in our UK stores energy usage, achieving a reduction

of 15%. More detail of our various achievements and

targets can be found in the ESG Report on page 33.

This is the first year of Taskforce on Climate-related

Financial Disclosures (TCFD). During the year we have

worked closely with expert external advisors to enhance

our understanding of the potential impact of climate

change on Frasers Group and to inform our future

strategy risk management approach and the metric and

targets we will use to monitor our progress. The TCFD

section can be found in the ESG report

on page 40.

Refinancing

In our Half Year reporting we noted the successful

refinance of our Group facility whereby we have access

to a combined term loan and revolving credit facility

(RCF) of £930.0m for a period of three years, with the

possibility to extend this by a further 2 years. This facility

has increased in size to £980.0m since then. We believe

this is a great endorsement for the business and our

Elevation strategy and I want to say thank you to our

banking partners for their support.

Disposals

Subsequent to the period end the Bob’s Stores and

Eastern Mountain Sports fascias and their corresponding

e-commerce offerings were disposed of for

consideration of $70m. The Bobs and EMS store estate

does not include any of the new elevated stores which

are core to the FG Elevation strategy. The disposal of

these non-core businesses allows Frasers Group to have

an even greater focus on delivering its Elevation strategy

by focusing on store experience, digital and product. The

board of Frasers Group is grateful to staff in Bobs and

EMS for their loyal service and wishes these businesses

every success for the future.

The Group disposed of a number of freehold and

long leasehold retail parks held by its wholly owned

subsidiaries post period end for a total of £205m.

Frasers Group fascias will operate from leases within

these properties where appropriate. Frasers Group in

the ordinary course of business purchases and sells

properties from time to time.

Outlook

Under Michael Murray’s direction and leadership, we are

confident the Group is well positioned for a successful

year ahead.

Relationships with our key brand partners are better

than they have ever been, and we will continue to invest

in supporting and growing these relationships.

The business cannot overlook the many significant

economic factors which are headwinds on the business,

including challenges with supply chain, increased energy

costs and cost of living – these factors could have an

impact on business potential.

However, we look forward to growing the business both

organically and through acquisitions, to ensure we

remain a market leader globally. We believe the growth

factors will mitigate these headwinds and we will be

looking to grow our Adjusted PBT to between £450m

and £500m in FY23.

Dividend and Share Buybacks

The Board has decided not to pay a final dividend in

relation to FY22 (FY21 £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.

Our share buyback programme during the year has

continued which is a demonstration of our commitment

to shareholder returns, our confidence in the Company

and the strategy for future growth.

David Daly

Non-Executive Chair of the Board

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

OUR BUSINESS

Business Model

Founded as a single Store in Maidenhead in 1982,

Frasers Group Plc today operates a diversified portfolio

of sports, fitness, premium lifestyle and luxury store

fascias. The Group’s colleagues work together with our

suppliers and our third-party brand partners to serve

customers in over 20 countries. The Group aspires to

be an international leader in sports, lifestyle and luxury

retail. The Board is committed to treating all people with

dignity and respect. We value our people, our customers

and our shareholders and we strive to adopt good

practices in our corporate dealings. We aim to deliver

shareholder value over the medium to long term, whilst

adopting accounting principles that are conservative,

consistent and simple. Our strategy is set out in the ‘Our

Strategy – To build the World’s most compelling brand

ecosystem’ section of this report.

Our business model remains consistent in providing

customers with the World’s best brands. This requires

us to have the right product, in the right place, at the

right time and at the right price. Our vision is to become

the elevated, multi-channel platform for our Sports

Retail and Premium Lifestyle fascias. To this end, we are

elevating across all channels to enhance the customer

journey every step of the way.

The Group’s business model is explained in greater

detail below. This includes an outline of our fascias and

retail channels, management of our property portfolio,

our people, our third-party brand partners, our Group

brands and our centralised support functions.

Business Structure

The Group is structured across five business segments:

UK Sports Retail, Premium Lifestyle, European Retail,

Rest of World Retail and Wholesale & Licensing.

In UK Sports Retail, we offer a complete range of

sporting apparel, footwear and equipment through our

predominant fascia, Sports Direct. This segment also

includes our lifestyle fascia USC. Our current forward-

looking view is that the majority of our offering to

customers must include leading third-party brands.

The elevation of our sports retail proposition is key to

ensuring we are fully aligned with the future direction

and ambitions of these brand partners. UK Sports

Retail includes core sports retail store operations in the

UK, plus all the Group’s sports retail online business

(excluding Bob’s Stores, Eastern Mountain Sports and

Sports Direct Malaysia), the gyms, SRL, the Group’s

Shirebrook campus operations, retail store operations in

Northern Ireland, Evans Cycles and the GAME UK stores

and online business.

In Premium Lifestyle, we are developing the Group’s

premium and luxury offering, which consists of the

FLANNELS, Frasers, House of Fraser, Jack Wills and

Sofa.com fascias, along with Cruise and van mildert. We

aim to offer fashion-conscious consumers a luxurious,

multi-brand retail destination with high-end and

on-trend products.

In European Retail, we are evolving our customer

proposition in line with the Elevation strategy, while also

seeking to increasingly tailor our proposition to the local

markets in which we operate. These include the Republic

of Ireland and continental Europe.

In Rest of World Retail, we operate stores trading as

Bob’s Stores and Eastern Mountain Sports and we

also have stores trading as Sports Direct in Malaysia.

Subsequent to the period end the Bob’s Stores and

Eastern Mountain Sports fascias and their corresponding

e-commerce offerings were disposed of, further detail

can be found in note 16.

In Wholesale & Licensing, the Group retains a portfolio

of World-famous heritage brands, which we offer via

our fascias, and also wholesale and license to partners

internationally. Our own brands include Everlast,

Lonsdale, Karrimor and Slazenger. The Group is also

proud to have a number of sporting and entertainment

personalities as ambassadors, as well as supporting

sporting events.

Multi-Channel Elevation strategy

Our Elevation strategy continues to work towards

improving our offering to customers across all our

channels, including marketing, social media, product,

digital and in-store. This aims to enable the Company,

along with our third-party brand partners, to connect

with customers via a consistent voice across multiple

platforms, including online, mobile and on the high

street. This strategy enables our stores and our online

operations to complement each other.

The websites for each of our core fascias in the UK,

including SPORTSDIRECT.com, USC.co.uk, FLANNELS.

com, Houseoffraser.co.uk and GAME.co.uk, have

undergone significant enhancements to facilitate

optimum appeal to consumers. Our product offering

across these core fascias, both in-store and online,

aims to create a compelling shopping experience in

key categories that include, amongst others, football,

women’s, kids, running, cycling, lifestyle, fashion, luxury

and gaming.

FRASERS GROUP PLC ANNUAL REPORT 2022

We offer product across a range of price points,

including good, better and best. This enables us to

offer more premium products, which is net-new to

the business. This gives consumers a greater range

of choices for those who wish to shop for premium

products, whilst still retaining our original entry-level and

continuity product offerings.

Progression of the Elevated Store Model

The Group remains firmly committed to the Elevation

strategy across fascias and territories building on the

momentum gained over recent years.

For Sports Direct, the beginning of the financial period

welcomed the opening of the Oxford Street, London

flagship store following a significant refurbishment.

This store showcases the elevated flagship concept in

one of Europe’s most iconic retailing destinations. A

further flagship Sports Direct store was opened after

the financial period end in Birmingham city centre,

and additional markets are being explored to deliver

equivalent flagship stores.

To complement the elevated Sports Direct concept,

store-in-store models continue to be refined for our

Evans Cycles and GAME fascia’s providing a more

diverse offer in-store.

A significant milestone over the period was the first

FLANNELS flagship store opening in Sheffield, with

this large format incorporating new categories such as

beauty and food & beverage. After the period end, the

FLANNELS flagship concept reached new heights with

the opening of the largest FLANNELS store to date

in Liverpool, covering 120,000 sq ft over seven floors.

The new store introduces new experiences such as the

boutique fitness brand Barry’s Bootcamp.

Post period end a new Jack Wills concept store was

launched in Derby. To complement this new concept a

store-in-store model has also been developed, having

been launched in selected USC locations.

Finally, a new Everlast Gym concept was delivered in

Denton, Manchester. This elevated concept sets the

new standard for the division, with more sites to follow.

Our People

The Group’s policy is to treat all our people with dignity

and respect. Frasers Group colleagues work together

across all areas of the business and we are proud that

Frasers Group Plc is one of the first public companies

in the UK to make an elected Workers’ Representative

a Board member. We welcome all new colleagues into

the Group following the acquisitions in the year and post

period end and those who joined us through the Frasers

Group Elevation Programme as well as all other

new recruits.

Remuneration and Rewards

Our policy is to foster a reward-based culture that

enables our colleagues to share in the success of the

Group. It is Company policy to pay above the statutory

National Minimum Wage, including rates that are

above the statutory National Living Wage for those

over 23 years of age in the UK. In addition to this, in the

current period the Group paid awards and incentives of

approximately £15.0m, from which both permanent and

casual colleagues benefitted.

Our Fearless 1000 share scheme will result in 1,000 of our

Fearless colleagues, who live and breathe our values -

thinking without limits and take the team with you, don’t

hesitate and act with purpose and own it and back

yourself - being eligible to receive share bonuses ranging

from £50k right up to £1m, if the share price is at £10 at

the vesting dates. See note 25 for further details.

Workers’ Representative

The Frasers Group Workers’ Representative is Cally

Price, a Manager at our Cardiff Bay store. The Workers’

Representative has a unique insight into the Group

and will speak on behalf of the Group’s workforce at all

scheduled meetings of the Board, in order to facilitate a

healthy and constructive dialogue.

Colleague Engagement

In addition to the Workers Representative, the Company

has an ongoing dialogue with colleagues via an

initiative called ‘Your Company, Your Voice.’ This is a

system whereby colleagues are able to raise any issues

of their choosing via a number of different routes, both

physical and digital. This feedback is passed to senior

management and the Workers’ Representative for

review and appropriate action.

Our Global Third-Party Brand Partners

We work with our leading third-party global brand

partners and provide significant prominence for them

with our customers across all our platforms.

Our third-party and Group brands are managed by

central brand and marketing teams. This centralised

structure significantly benefits the Group by enabling

the individual brands to participate in Group buying

and sourcing; aggregated supplier relationships and

enhanced supply chain disciplines; Group inventory

monitoring and replenishment; and more inspired and

harmonious visual merchandising in-store.

FRASERS GROUP PLC ANNUAL REPORT 2022

OUR STRATEGY

Frasers Group believes in the power of brands. We serve

them, nurture them, and invent them. Today more than

ever, the World looks to Brands for ideas, inspiration

and meaningful change, crexating value for people and

elevating the everyday.

Our strategy is aligned to this purpose and is based on

three interconnected focus pillars – the brands we sell,

our digital offering and our physical stores. These are

supported by a set of enablers, focused on our people,

systems, automation and data. By continuing to elevate

our performance across all areas of our strategy, we will

achieve our vision: to build the World’s most compelling

brand ecosystem.

BUILD

THE

WORLD’S

MOST

COMPELLING

BRAND

ECOSYSTEM

FRASERS GROUP PLC ANNUAL REPORT 2022

Strategy Key Achievements In FY22 Priorities for FY23

Brands

Our customers look to brands to elevate their

everyday. They want to have the choice of the

World’s best brands, whether in sports, lifestyle or

luxury. Accessibility is essential for our success. To

achieve our vision, we focus on building excellent

relationships with our brand partners, unlocking

the best talent and product.

This powerful brand offering is supported by our

complementary range of own brands, where we

aim to offer unrivalled choice and value, and

drive growth through meaningful partnerships

and brand collaborations. We will continue

to consider strategic acquisitions that bring

attractive brands into the Group.

During FY22, our achievements included:

• Further growing our relationships with key

brand partners, such as Nike, adidas, Gucci,

Balenciaga, Mulberry and Hugo Boss, and

establishing new, innovative brand partners

such as Hermes Beauty, On Running

and Jacquemus.

• Supporting our key strategic brand partner,

Hugo Boss AG, with an increased Strategic

Investment, reflecting our growing relationship,

our confidence in its future and the potential

for synergies between our businesses.

During FY23, our priorities are to:

• Continue to nurture and strengthen our brand

partner relationships and further improve our

access to their best product and talent.

• Invest in and grow our own-brand portfolio, to

ensure they remain relevant to consumers and

pioneer the market.

• Invest in the best talent for our businesses, so

that our partners continue to have consistent

and effective communication, to ensure that

they have clear insight into the businesses’

strategic goals.

Digital

We aim to elevate our digital experience to meet

the demands of consumers and brands and offer

an outstanding experience.

Through our digital Elevation strategy, we

are continuing to invest more than £100m to

elevate our proposition across our channels. This

investment has and will further build on our core

digital foundations, to support future growth

and agility.

A key focus remains our online customer

experience, which includes investment into

platforms that will reinvent engagement, data,

marketing and customer service.

During FY22, our achievements included:

• Significantly improving the digital consumer

experience across all touchpoints within the

Group.

• Investing and working alongside industry

leaders, ensuring our web business has

remained relevant with strong performance.

• Integrated 360 marketing initiatives to

demonstrate a cohesive and better reflecting

brand image for our fascia’s.

During FY23, our priorities are to:

• Continue to invest in our online retail

capabilities, particularly on the luxury

side of the business, which will focus on

merchandising, brand adjacencies and visual

representation.

• Pioneer our approach to digital marketing

through the latest trends and consumer

insights, to ensure we are industry leaders

within this market.

• Invest in our payment platform strategy.

Physical

The elevation and concept innovation of our

physical store portfolio is a fundamental part of

our Group-wide strategy.

Across our three pillars of Sports, Premium and

Luxury, we will continue to:

• Invest in new strategic locations and

acquisitions.

• Elevate and improve our current estate,

particularly for Sports Direct.

• Give consumers access to unrivalled luxury

destinations across the UK.

• Invest in retail efficiencies which will improve

our operating, technology, and stock

capabilities.

During FY22, our achievements included:

• Opening a series of our new-concept flagship

stores, including:

• FLANNELS Sheffield and FLANNELS

Leicester, which also saw the delivery of

our first ever food & beverage concepts

and the launch of

FLANNELS Beauty.

• Sports Direct Birmingham New Street

• Continuing to open new location stores

across UK and Europe, including Brighton,

Southampton, and Hertfordshire.

• Significantly investing in our flagship

FLANNELS Liverpool on Parker Street, which

opened to great acclaim in

June 2022.

• Committing to over 500,000 sq. ft of vacant

retail space in the Irish market with recent

store openings in Derry, Cork,

and Galway.

• Acquiring Boucher Retail Park in

Northern Ireland.

During FY23, our priorities are to:

• Roll out new elevated stores across

the Group.

• Invest in new concepts and retail partner

collaborations across key categories which

will focus on fitness, home, and beauty.

• Develop and improve operational excellence

across our retail portfolio.

• Progress the ongoing elevation and

improvement of our existing store portfolio.

• Strategise and select key destinations across

Europe for expansion.

Enablers

We need to have talented people who will

enable us to succeed, supported by training that

empowers them to achieve.

To attract new talent, we will continue to develop

our employer brand, while further improving

internal communication to drive engagement

with existing colleagues.

We will also continue to invest in our systems and

automation to enhance efficiency, and in our data

capabilities, so we can make data-driven decisions.

During FY22, our achievements included:

• Doubling down on our investment in people,

launching a new careers website, introducing

new roles and programmes focused on

learning and development, reinvigorating our

retail pay rates and incentives and recruiting

over 60 new high-potential people into our

early careers programmes.

• Connecting through regular communication

and videos, to create transparency with our

Leadership team.

• Further investing in automation, now claiming

one of the largest auto stores in the World.

• Enhancing data sharing with suppliers

through electronic data interchange (EDI),

improving management of stock and

streamlining supplier payment processes.

During FY23, our priorities are to:

• Build out clear career pathways in our

Commercial function, to enable the growth

we need in this area over the coming years.

• Continue to drive a high-performance culture,

with the introduction of more regular updates

and support around colleague performance.

• Significantly expand our Retail development

offering.

• Launch a new internal comms and

engagement platform to better connect

people across our business and share key

updates and successes.

• Continue onboarding products and suppliers

onto EDI.

• Capture customer data and insights through

growth in our digital business, digital

marketing and the roll-out of our loyalty

programme.

KEY PERFORMANCE INDICATORS

The Board manages the Group’s performance by reviewing a number of key performance indicators (KPIs).

The KPIs are discussed in this Chief Executive’s Report and Business Review, the Financial Review, the Environment

section and the ‘Our People’ section.

The table below summarises the Group’s KPIs.

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

52 weeks ended

26 April 2020

Group revenue

£4,805.3m £3,625.3m £3,957.4m

Reported PBT

£335.6m £8.5m £143.5m

Adjusted PBT

(1)

£339.8m (£39.9m) £115.1m

Cash flow from operating activities

£628.9m £578.3m £425.2m

Net assets

£1,308.6m £1,211.0m £1,280.3m

Non-Financial KPIs

Number of retail stores

(2)

1,552 1,547 1,534

Workforce turnover

38.3% 28.9% 28.6%

Packaging recycling

(3)

14,405 tonnes 11,164 tonnes 12,358 tonnes

The Directors have adopted Alternative Performance

Measures (APM’s). APMs should be considered in

addition to IFRS measures. The Directors believe

that Adjusted profit before tax (PBT) 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 IFRS and may not be

directly comparable with ‘adjusted’ or ‘alternative’ profit

measures used by other companies.

From FY22 management changed the main reporting

KPI from Underlying EBITDA to Adjusted PBT. Adjusted

PBT is profit before tax less 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.

This change has been reviewed by the Audit Committee

which has appropriately challenged management on

the presentation and the adjusting items included in

this APM.

(1) The method for calculating adjusted PBT is set out in note 4 and the Glossary.

(2) Excluding associates and stores in the Baltic states that trade under fascias other

than SPORTLAnd or SPORTSDIRECT.com. and other niche fascias. Includes GAME

and Sofa.com concessions.

(3) Cardboard and plastic recycling.

Management has taken this decision for the following

reasons:

• with the continued significant investment in and roll

out of our Elevation strategy, on both the physical

and digital fronts, the importance of depreciation

and amortisation to both the Board and our

stakeholders in terms of assessing performance has

grown;

• our understanding from a number of financial

sectors including the banking sector is that

accounting for IFRS 16 Leases is becoming an

increasingly important consideration; and

• with this new measure being introduced we are

trying to align with the Financial Reporting Council’s

thematic standpoint with regard to ‘alternative

performance measures’ as far as possible whilst

retaining a degree of interpretation given factors

outside of our control, such as FX and fair value

movements in our Strategic Investments which

are exceptionally difficult to forecast, particularly

months in advance.

FRASERS GROUP PLC ANNUAL REPORT 2022

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

Adjusted PBT 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

Cash inflow from operating activities is considered

an important indicator for the Business of the cash

available for investment in the Elevation strategy.

Net Assets

The Board considers that this measurement is a key

indicator of the Group’s 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.

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.

Packaging Recycling

The Board considers that this measurement is a key

indicator of our impact and commitment to the best

environmental practices. for more details refer to the

environment section of this report.

FRASERS GROUP PLC ANNUAL REPORT 2022

CHIEF EXECUTIVE’S REPORT AND

BUSINESS REVIEW

Clear Vision

We are accelerating our strategy to provide consumers

with access to the World’s best sports, premium and

luxury brands by providing a World-leading retail

ecosystem. Aligned with this vision, we have defined the

Group’s purpose:

To elevate the lives of the many by giving them access to the

World’s best brands and experiences.

To deliver on this mission and purpose, and to maintain

the momentum created by the Elevation strategy, we

will continue to work closely with our key brand partners

such as Nike, Hugo Boss and Stone Island, to align

plans. Our brand partnerships are deeper and stronger

than they have ever been in the Group’s history. These

relationships will allow us to continue improving our

product offering and customer experience, by creating

the best platforms to enable our brands to succeed.

We are also redeveloping our sustainability strategy to

ensure we set ambitious targets and meet them in

the coming years.

Strategic Delivery

Our focus has been on executing our Elevation

strategy, with investments across our store portfolio,

brand partnerships and further innovations across our

operations. The strategic investments we made during

the year offer exciting new opportunities for Frasers

Group, whilst also supporting the long-term future of the

existing retail businesses, saving the jobs and

livelihoods of many.

Our recent acquisition of Studio Retail Limited provides

expertise and synergies which will enable us to deliver

flexible payment models in the future. Our post period

end acquisitions of the digital-first fashion brands

Missguided and I Saw It First allows us to unlock the

latest trends in women’s fashion and e-commerce.

To strengthen our European expansion strategy,

subsequent to the period end we acquired the leading

Danish sport retailer SportMaster.

We will also continue to divest non-core assets that fall

outside our vison and key focus segments, such as our

post period end disposal of Bob’s Stores and Eastern

Mountain Sports in America. Further details can be

found within note 16.

Increased PBT Guidance

We are alive to the challenging economic conditions at

present, with inflationary pressures and supply chain

disruption causing challenges for many businesses

operating in the retail sector. As well as the significant

increase in general running costs, we are fighting

against a fundamentally flawed business rates system

which is yet to be addressed. Linked to these are the

cost-of-living pressures facing many of our consumers.

As a result, we have been conservative in our forecasting

for the next financial year. However, with our proven

strategy and strong operational backbone, we are

confident of achieving a healthy growth to between

£450m and £500m of Adjusted PBT.

Store Openings

Our Elevation strategy keeps exceeding our

expectations. Its strength is demonstrated by our recent

store openings of FLANNELS Liverpool and Sports

Direct Birmingham.

FLANNELS Liverpool is one of the largest luxury retail

investments in the UK to date. This revolutionary

seven floor, 120,000 sq. ft store in a historic building

brings a ground-breaking fashion, beauty, wellness

and restaurant experience to the North of England. It

boasts a leading collection of experiences including

boutique fitness phenomenon Barry’s Bootcamp, the

first ever of its kind in a retail environment. Our regional

flagships do not only benefit the physical environment,

but also allow us to bring in new categories and brands

that our consumers can access online through our

omnichannel platforms.

Sports Direct Birmingham follows our Oxford Street,

London, opening last summer. Both stores demonstrate

the pinnacle of our journey and showcase the strength

of our Elevation strategy. The consumer experience

has been enhanced at every stage including digital

touchpoints, activations and integrations of other

group brands such as Evans, USC and GAME, giving

access to a wider variety of products and experiences.

FRASERS GROUP PLC ANNUAL REPORT 2022

Big Believers in Physical Retail

We have consistently criticised the archaic business rates

regime and the need for reform. Unfortunately, these

issues remain unaddressed and are now coupled with

soaring construction and store fit out costs, making

for an extremely challenging environment to open and

operate physical stores. While others have shied away

from committing to physical retail in these difficult times,

we are convinced that consumers will still flock to stores

for great brands and experiences. This belief has allowed

us to build remarkable momentum, bucking market

trends. We will continue to invest in new store openings,

refurbishments and flagship opportunities, to bring

the World’s best brands and experiences to untapped

markets.

Digital and Operational Transformation

As part of our growth strategy, we are continually

innovating across our supply chain and logistics to

drive further efficiencies. At our Shirebrook site, home

to our distribution centre, we have invested over £200m

in automation. This makes us the biggest AutoStore in

Europe and vastly improves our digital capabilities.

This has provided us with significant operational

efficiencies and supported the smooth integration of

acquisitions into the Frasers Group platform, enabling

both our own brands and brand partners to benefit from

our World-leading operations and logistics capabilities.

At Shirebrook, we now have approximately 2 million sq.

ft of warehousing, which enables us to process up to 4

million units per week. This still leaves us with capacity

for further growth.

We have continued to iterate and improve across the

entirety of our Frasers Group platform. Most notably

we have trialled a new headless e-commerce platform

on our Malaysian site, with a view to roll-out across

the Group. This will be a transformative step for the

Group, allowing us to be more agile when entering new

territories or deploying changes to our technology stack.

Global Growth

We also have extensive ambitions to grow the business

outside of the UK and will be exploring the potential

for further international expansion through acquisitions,

joint ventures and organic openings. We have already

begun to expand our operational capabilities in Europe,

with a new development site in Bitburg, Germany set to

open in the coming years. This will have up to 2.4million

sq. ft of warehouse and distribution space, handling

approximately 300 million units annually. This will

support our growth across continental Europe.

Talent and Partners

To support the Group in executing our ambitious strategy,

I am proud to have built an excellent senior team made

up of outstanding talent. They are the driving force

behind the Group’s ambitious culture, bringing together

dynamic, talented and motivated teams to drive

growth across the business. I have made it a priority

to strengthen Frasers Group’s management team by

creating several new roles. Alongside the management

team, we will look to support the business by adding

relevant talent and expertise to the Board

when appropriate.

Finally, thank you to our people and partners for your

continued support. I am proud of the steps we have

taken this year in transforming the trajectory of Frasers

Group and look forward to another exciting year of

innovation, impact and growth.

Michael Murray

Chief Executive Officer

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

Performance Overview

Group revenue increased by 32.5% to £4,805.3m in

the year. UK Sports Retail revenue increased by 34.1%

to £2,640.1m, Premium Lifestyle revenue increased by

43.6% to £1,056.6m, European Retail revenue increased

by 28.4% to £790.2m, Rest of World Retail revenue

decreased by 1.6% to £150.3m and Wholesale &

Licensing revenue increased by 9.7% to £168.1m.

Group gross margin in the year has improved compared

with the prior year with a small increase of 130 basis

points from 42.2% to 43.5%. UK Sports Retail margin

increased 100 basis points to 43.1% (FY21: 42.1%),

largely due to the continually improving product

mix. Premium Lifestyle’s gross margin was 44.9%

(FY21:44.9%), consistent with the prior year as product

margins were maintained over the period. European

Retail gross margin increased to 42.7% (FY21: 39.0%),

largely due to continually improving product mix in

the core business. Rest of World Retail gross margin

increased to 51.0% (FY21: 41.9%), largely due to

decreased inventory provisions within the US businesses

as inventory management was significantly improved.

Wholesale & Licensing gross margin decreased to 37.5%

(FY21: 44.1%), largely due to product mix within the US

wholesale division.

Group Selling, distribution and administrative expenses

increased by 20.5% largely driven by increased store

costs due to the reopening of stores after lockdowns

due to the Covid-19 pandemic, no repeat of the prior

year Government support schemes such as CJRS

(Coronavirus Job Retention Scheme), business rates

relief in the prior year particularly in House of Fraser and

increased investment in marketing.

There were property related impairments in the period

totaling £227.0m (FY21: £317.0m), including £76.8m in

relation to right-of-use assets (FY21: £168.2m), £106.5m

in relation to freehold land and buildings (FY21: £84.4m),

£2.0m in relation to long-term leasehold (FY21: £3.9m),

£40.7m of other property, plant and equipment (FY21:

£59.9m) and £1.0m of investment properties (FY21:

£0.6m). Property related impairments have been

recognised following a reassessment of future expected

cash flows largely driven by supply chain issues, the

increased cost of living, the change in consumer

behaviour in moving from physical to online shopping,

the impact of direct-to-consumer and increasing costs

as a result of Brexit. Further details including sensitivity

analysis are included within note 2.

Depreciation and amortisation charges have decreased

by 15.4% to £260.0m (FY21: £307.5m) largely due to prior

period impairment and a decrease in freehold land and

buildings depreciation, following the change in useful

economic life estimate in the period. See accounting

policies for further details.

As a result, Adjusted PBT for the year was £339.8m (FY21:

loss £39.9m). Excluding acquisitions and on a currency

neutral basis, Adjusted PBT increased to £371.9m from

a loss of £22.1m. UK Sports Retail Adjusted PBT was

£196.9m up from a loss of £12.8m in FY21, while Premium

Lifestyle Adusted PBT was £10.5m, up from a loss of

£7.8m in FY21. European Retail Adjusted PBT was £88.6m,

up from a loss of £51.3m in FY21. Rest of World Retail

Adjusted PBT was £32.7m, up from £12.2m in FY21 and

Wholesale & Licensing Adjusted PBT decreased to £11.1m

from £19.8m.

Group profit before tax increased to £335.6m (FY21:

£8.5m), driven by the strong reopening of stores after

lockdown, new FLANNELS stores, continued growth

in online in the premium lifestyle segment, continued

operating efficiencies, and the FY21 comparative

including Covid-19 related lockdowns, mitigated to some

extent by property related impairments of £227.0m.

Basic EPS for the year increased to 52.9p

(FY21: loss of 16.5p).

Within other comprehensive income, the Group’s

hedging contracts increased by £43.8m (FY21: decreased

by £16.5m) as a result of the fair value movements in the

period. With regard to the Group’s long-term financial

assets, fair value movements have resulted in a loss of

£8.1m (FY21: gain of £77.3m) in the period.

The Group generated cash inflows from operating

activities during the year of £628.9m, up from £578.3m in

the prior period, largely due to the increase in operating

profit year on year, offset by the increase in inventory.

Total Net assets as at the period end totalled £1,308.6m

compared to £1,211.0m in the prior period, largely due to

the profitability of the business mitigated by significant

share buybacks.

FRASERS GROUP PLC ANNUAL REPORT 2022

REVIEW BY BUSINESS SEGMENT

UK Sports Retail

The UK Sports Retail segment includes all of the

Group’s sports retail and USC store operations in the

UK (including Northern Ireland), all of the Group’s online

businesses (excluding Bob’s Stores, Eastern Mountain

Sports, Baltics and Malaysia), the Group’s gyms, Evans

Cycles, GAME UK stores and the Group’s Shirebrook

campus operations. UK Sports Retail is the main driver of

the Group and accounts for 54.9% (FY21: 54.3%)

of Group revenue.

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

UK Sports Retail Revenue

2,640.1 1,968.5

Cost of Sales

(1,503.3) (1,139.2)

Gross Profit

1,136.8 829.3

Gross Margin %

43.1 42.1

Revenue increased 34.1% to £2,640.1m. Excluding

acquisitions, revenue increased 30.1%, largely due to

the strong reopening of stores after the last lockdown in

March 2021 and the comparative period being impacted

by lockdowns as a result of Covid-19.

UK Sports Retail gross margin increased to 43.1%

(FY21: 42.1%), largely due to the continually improving

product mix.

Adjusted PBT for UK Sports Retail was £196.9m (FY21:

loss of £12.8m), largely due to the strong reopening of

stores after the last lockdown in March 2021 and the

comparative period being impacted by lockdowns as

a result of Covid-19 and a reduction in property related

impairments in the current period (FY22: £103.4m

compared to FY21: £201.9m).

UK Sports Retail Store Portfolio

(3)

24 April 2022 25 April 2021

England

387 394

Scotland

37 39

Wales

30 31

Northern Ireland

19 21

Isle of Man

1 1

GAME UK (1)

259 247

Evans Cycles (2)

57 48

USC

18 25

Total

808 806

Opened

90 93

Closed

(88) (98)

Acquired

- 42

Area (sq.ft.)

approx. 6.7m approx. 6.5m

(1) The GAME UK store numbers include 125 concessions operating within

Sports Direct fascia stores (FY21: 71) and does not include BELONG arenas.

(2) The Evans Cycles store numbers include 2 concessions operating within

House of Fraser fascia stores (FY21: 1).

(3) Table excludes the Group’s standalone gyms.

FRASERS GROUP PLC ANNUAL REPORT 2022

Premium Lifestyle

Premium Lifestyle consists of FLANNELS, Cruise, van

mildert, House of Fraser, Jack Wills and Sofa.com fascia

stores and corresponding web sales.

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Gross Transaction Value (GTV)

(1)

1,133.8 788.1

Revenue

1,056.6 735.6

Cost of Sales

(581.8) (405.3)

Gross Profit

474.8 330.3

Gross Margin %

44.9 44.9

Adjusted PBT

10.5 (7.8)

(1) GTV being gross sales net of VAT, discounts and returns, and gross sales where the

Group acts as agent.

Revenue grew 43.6% to £1,056.6m. This was largely due

to new FLANNELS stores, continued growth in online,

growth in House of Fraser, and the impact of Covid-19

related lockdowns on the prior period comparative.

Gross margin was 44.9%, consistent with the prior year

as product margins were maintained over the period.

It should be noted that despite year-on-year trading

improvements in the House of Fraser business, business

rates in their current form continue to be a significant

and disproportionate cost to House of Fraser.

Adjusted PBT for Premium Lifestyle increased from a

loss of £7.8m in FY21 to a profit of £10.5m for the period,

largely due to new FLANNELS stores, continued growth

in online, the strong reopening of stores after the last

lockdown in March 2021, offset by more significant

property related impairments in the current period (FY22:

£103.5m compared to FY21: £40.9m).

Premium Lifestyle Store Portfolio

24 April 2022 25 April 2021

FLANNELS

53 41

Jack Wills

(2)

52 60

House of Fraser / Frasers

(2)

39 43

Sofa.com

(1)

23 24

Cruise

5 5

18 Montrose

4 3

van mildert

1 1

Garment Quarter

1 1

Psyche

1 1

Total

179 179

Opened

21 12

Closed

(21) (17)

Acquired

- 5

Area (sq.ft.)

approx. 4.0m approx. 4.2m

(1) Sofa.com store numbers include 17 concessions operating within House of Fraser

fascia stores (FY21: 17).

(2) Jack Wills and Frasers stores in Republic of Ireland are shown in the European

store numbers as opposed to the Premium Lifestyle store numbers.

FRASERS GROUP PLC ANNUAL REPORT 2022

European Retail

The European Retail division includes the Group’s sports

retail store management and operations in Europe,

including the Group’s European distribution centres in

Belgium and Austria, stores and corresponding web

business in the Baltic regions and GAME Spain stores

and corresponding web business.

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Revenue

790.2 615.2

Cost of Sales

(452.9) (375.5)

Gross Profit

337.3 239.7

Gross Margin %

42.7 39.0

Adjusted PBT

88.6 (51.3)

Revenue increased 28.4% to £790.2m. On a currency

neutral basis and excluding acquisitions, European Retail

revenue increased by 33.4%, largely due to temporary

store closures as a result of Covid-19 in the prior period

comparative.

Gross margin increased to 42.7%, largely due to

continually improving product mix in the core business.

Adjusted PBT for European Retail improved from a loss of

£51.3m in FY21 to a profit of £88.6m for the period, largely

due to the strong reopening of stores after lockdown, the

comparative period being impacted by lockdowns as a

result of Covid-19, especially in Ireland and significant

property related impairments in the prior period of

£71.6m compared to £17.9m in the current period.

All of the following stores are operated by companies

wholly owned by the Group, except Estonia and Latvia

where the Group owns 60.0% and Lithuania where the

Group owns 51%.

European Retail Store Portfolio

(1)

24 April 2022 25 April 2021

GAME Spain

235 236

Republic of Ireland

(1)

43 39

Belgium

34 34

Portugal

21 20

Estonia

(2)

20 21

Austria

19 20

Lithuania

(2)

19 18

Latvia

(2)

18 17

Poland

13 14

Slovenia

13 13

Czech Republic

12 12

Spain

10 9

Hungary

8 8

Cyprus

6 6

Holland

5 5

Slovakia

5 5

France

4 4

Luxembourg

2 2

Germany

1 2

Iceland

1 1

Total

489 486

Opened

12 13

Closed

(9) (38)

Acquired

- -

Area (sq.ft.)

approx. 3.7m approx. 3.6m

(1) Excluding Heatons fascia stores

(2) Includes only stores with SPORTSDIRECT.com and SPORTLAnd fascias.

FRASERS GROUP PLC ANNUAL REPORT 2022

Rest of World Retail

Rest of World Retail includes sports stores in Malaysia

trading under the Sports Direct fascia, retail stores in the

US trading under Bob’s Stores and Eastern Mountain

Sports and their online businesses. In Malaysia the stores

are 51.0% owned by the Group.

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Revenue

150.3 152.7

Cost of Sales

(73.6) (88.7)

Gross Profit

76.7 64.0

Gross Margin %

51.0 41.9

Adjusted PBT

32.7 12.2

(1) GTV being gross sales net of VAT, discounts and returns, and gross sales where the

Group acts as agent.

Revenue decreased 1.6% to £150.3m, mostly due to the

US businesses offset by an increase in Malaysia. Gross

margin increased to 51.0% from 41.9%, largely due to

decreased inventory provisions within the US businesses,

as inventory management was significantly improved.

Adjusted PBT was £32.7m, compared to £12.2m in FY21,

largely due to overall operating efficiencies in the US

businesses.

Subsequent to the period end the Bob’s Stores and

Eastern Mountain Sports fascias and their corresponding

e-commerce offerings were disposed of.

Rest of World Retail Store Portfolio

24 April 2022 25 April 2021

Malaysia

34 33

Bob’s Stores

21 22

Eastern Mountain Sports

21 21

Total

76 76

Area (sq.ft.)

approx. 1.3m approx. 1.3m

Wholesale & Licensing

The portfolio of Group brands includes a wide variety of

World-famous sport and lifestyle brands. The Group’s

Sports Retail division sells products under these brands

in its stores, and the Wholesale & Licensing division

sells the brands through its wholesale and licensing

activities. The Wholesale & Licensing division continues

to sponsor a variety of prestigious events and retains a

variety of globally recognised celebrities and sporting

professionals as brand ambassadors.

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Wholesale

145.3 131.5

Licensing

22.8 21.8

Total Revenue

168.1 153.3

Cost of Sales

(105.0) (85.8)

Gross Profit

63.1 67.5

Gross Margin %

37.5 44.1

Adjusted PBT

11.1 19.8

Revenue increased by 9.7% to £168.1m. Wholesale

revenues were up 10.5% to £145.3m and Licensing

revenues increased 4.6% to £22.8m, largely due to the

prior period comparative being impacted by Covid-19.

Total gross margin decreased to 37.5% (FY21: 44.0%),

largely due to product mix within the US wholesale

division. Adjusted PBT decreased 43.9% to £11.1m (FY21:

£19.8m), largely due to impairment of goodwill in

the period.

FRASERS GROUP PLC ANNUAL REPORT 2022

PROPERTY REVIEW

The beginning of the financial year welcomed the

opening of the refurbished Sports Direct on Oxford

Street, London, showcasing the elevated store model

in one of Europe’s most iconic retailing destinations.

Further Sports Direct flagship locations in the pipeline

include Birmingham, which opened shortly after the

financial period end and Manchester, due to open late

FY23. Opportunities to deliver this flagship concept are

also being considered in various European capital cities.

In addition, a refurbishment model has been trialled

and is under development, to elevate appropriate stores

which are currently trading.

FLANNELS experienced significant new store activity

over the period with 15 new openings. The most notable

opening was delivering the first FLANNELS flagship store

in Sheffield incorporating beauty and food & beverage

elements across 55k sq ft. The outcome is a World-class

luxury offering receiving industry recognition. A second

FLANNELS Flagship store was also opened in Fosse Park,

Leicester, in the period. Further flagship sites have been

secured in Liverpool which is now trading, along with

Cardiff and Leeds which are both due to open during

FY24. FLANNELS will also be expanding its store network

into Ireland over the coming financial period. These will

be the first store openings outside of the U.K. for the

brand having secured sites in Dublin, Blanchardstown

and Cork.

The Group continues to identify large sites, which

working with collaborative landlords can be configured

to provide a multi fascia offering. Over the period sites

have been secured at Derby, Cork and Newbridge in

Ireland, to develop into Frasers and Sports Direct stores.

The main objective for the Group’s estate remains the

move to turnover-based rents. There has been significant

investment into new store concepts across all the

Group’s brands, including more recently the new Everlast

Gym concept as well as enhancements to existing brand

concepts such as the Sports Direct and FLANNELS

Flagship concepts. Where landlords are prepared to

co-invest in new stores the Group is prepared to enter

into long leases.

The Group remains acquisitive across fascias and

territories, with an exciting pipeline of new stores due to

open in the coming financial year; the number of new

store openings is expected to be comparable to FY22.

However, caution is being applied over shop fit costs,

which are being monitored closely and could influence

the store opening pipeline. In the usual manner, freehold

investment activity will continue to be used as an option

to secure space for the Group.

The business rates regime continues to be a challenging

landscape to navigate, particularly on large stores

and former department stores. With further clarity

required on the new regime effective April 2023 and the

uncertainty around transitional relief arrangements, the

Group is taking a cautious view on future rates liabilities.

Store Portfolio – UK Retail

Sports Stores in the UK (including Northern Ireland):

• Sports Direct is currently operating 387 stores in

England, 37 in Scotland, 30 in Wales and 19 in

Northern Ireland. There were 18 openings and 30

closures over the period. The majority of closures

were linked to new larger store openings and

closures, following the acquisition of the DW Sports

estate in FY21.

• Noteworthy openings include the Oxford Street

flagship (55k sq ft), Leicester Fosse Park (35k sq ft)

and Cheshunt (25k sq ft), a new market opening

following the successful asset management plan of

the retail park that the Group acquired in FY20.

• Store-in-store GAME/BELONG and Evans Cycles

concepts have been developed to complement

Sports Direct formats in selected locations. All new

store openings include a USC zone providing a

lifestyle offering, as part of the elevated store model

across all size formats.

Store Portfolio – Evans Cycles:

• There are currently 57 Evans Cycle stores trading, an

increase of nine stores over the period as a result

of ten openings and one closure. The Evans Cycles

store-in-store concept continues to be refined and

will be rolled out into selected future store openings.

Store Portfolio – GAME UK:

• The relocation program transitioning GAME stores

into selected Sports Direct stores continued over

the period and will continue throughout FY23. With

GAME now forming part of a significant number of

new Sports Direct store openings, the overall number

of GAME stores for the UK estate increased to 259,

having closed 50 and opened 62.

• The BELONG gaming arenas form part of GAME

stores in selected viable locations and have been

introduced to a number of elevated Sports Direct

stores. Note the GAME store numbers do not

include BELONG.

FRASERS GROUP PLC ANNUAL REPORT 2022

Store Portfolio – Premium Lifestyle

FLANNELS, Cruise and van mildert:

• Across the FLANNELS, Cruise and van mildert

fascias there was significant store activity with

16 openings and four closures resulting in a net

increase of 12 stores. Combining these fascias,

the total estate at the end of the financial period

amounted to 59 stores.

• Key openings for FLANNELS include the

Meadowhall flagship being the first FLANNELS store

to incorporate a beauty offering and F&B along

with the Leicester Fosse Park Flagship opening

shortly after. FLANNELS was also introduced on the

South Coast of England for the first time opening at

Southampton, Brighton and Portsmouth.

• After the financial period, the largest FLANNELS

flagship store to date was opened in Liverpool

covering seven floors over 120,000 sq ft and

introducing new experiences such as the boutique

fitness brand Barry’s Bootcamp.

• A refit programme refreshing older stores to the

new standard continued over the period and

will continue throughout the upcoming financial

period. There will be a focus on securing further

new stores in key incremental markets as well as

flagship locations.

• Finally, FLANNELS is due to launch in the Republic

of Ireland over FY23 having secured three new store

locations over the period. The secured locations are

in Dublin, Blanchardstown and Cork.

House of Fraser (HoF):

• At the end of FY22 there were 39 House of Frasers

stores trading, a net decrease of four stores after five

closures and one opening.

• Having come back into effect following relief over

the pandemic, the current business rates regime

remains a significant burden on the Hof estate

particularly given the large store sizes. Clarity

around the new regime effective April 2023 is

eagerly awaited and will be an influential factor on

the Hof estate.

• Whilst a significant proportion of the Hof estate

remains on short term flexible leases, progress has

been made on securing long term solutions. New

Frasers stores due to open over FY23 include Derby

along with Cork and Newbridge in Ireland.

Jack Wills:

• Over FY22 there were eight store closures reducing

the estate to 52 stores. Negotiations with landlords

continue to transition to long term leases.

• A new store concept for Jack Wills was delivered

shortly after the FY22 period end in Derby and

additional locations to deliver the new concept are

being pursued. Further to this a new shop-in-shop

concept has been developed and implemented in a

number of USC locations.

Store Portfolio - European Retail:

Republic of Ireland (ROI):

• At the end of the financial period there were 43

stores within the Republic of Ireland (ROI), a net

increase of four stores. Key new openings included

Sports Direct stores in Galway, Newbridge and Cork

Mahon Point Shopping Centre, which are all new

incremental markets.

• Further incremental markets and upsizes across the

ROI are actively being pursued for Sports Direct.

Along with the new store pipeline, a refit programme

is underway elevating appropriate Sports Direct

stores to the latest concept.

• During the financial period three FLANNELS

locations were secured in ROI and due to open over

FY23. This is a first for the fascia and the territory.

The secured locations were Dublin, Blanchardstown

and Cork.

FRASERS GROUP PLC ANNUAL REPORT 2022

Store Portfolio Europe (excluding ROI):

• The Group continues to operate sports stores in 19

countries in Europe.

• 211 Sports retail stores in Europe (excluding ROI, plus

26 non-core, speciality and outlet stores).

• Total sq.ft. of approx. 2.7m of all sports fascias

in Europe (including Sportland, Lillywhites,

SportsWorld etc).

• Closed 1 GAME store in Spain during the period.

• Seven openings in six different countries.

• Eight closures in five different countries either due

to poor performance, beneficial trade transfer or

landlords required the units back.

• During the period four elevated Sports Direct stores

incorporating a USC were opened totalling 47,012

sq ft of retail space. One of these was a freehold

purchased in FY20 that has been refurbished and

opened as an elevated Sports Direct store alongside

a right-sized Toys R Us store.

• As is the case in the UK, the Group is firmly

committed to the rollout of elevated stores across

Europe. Due to the accelerated shift to online

experienced across Europe due to the effects of

Covid-19 and a number of retailers reducing their

portfolio size, the Group believes it can capitalise

on these market conditions to efficiently expand

our physical estate, focussing on capital city and

flagship opportunities.

• We further expanded our geographical coverage

with the purchase of Denmark’s number one

Sporting Goods chain, Sportmaster, shortly after

the financial period. This increased our sports store

numbers by a further 75.

Store Portfolio – Rest of the World:

• 34 stores in Malaysia following 4 openings and 3

closures over FY22. Our flagship store at Sunway

Carnival totalling 18,284 sq ft and incorporating a

USC lifestyle area on the ground floor, opened in the

period alongside our Frasers Group Asia HQ at the

Sunway Pyramid retail and leisure complex.

• The Malaysian elevation and expansion drive

continues with all long term stores now elevated

into the latest Sports Direct fit outs. Five of these

stores now have USC areas within and we will

look to roll-out this concept across the estate

where appropriate.

• 42 stores in the USA, following one closure in FY22.

The Group subsequently sold the Bob’s Stores and

Eastern Mountain Sports business shortly after the

financial period end.

Freehold / Long Leasehold Property:

• Over FY22 a total of 14 properties were acquired

across the Group, totalling £121.3m. The most

significant purchase was Boucher Road Retail

Park in Northern Ireland for £40.0m. One site was

acquired within the EU consisting of development

land for a logistics scheme.

• Disposal of property assets continues to be standard

practice for the Group. Over the period eight

disposals completed in the Group totalling £36.8m.

There were no disposals across the EU or RoW.

• For the upcoming financial period it is anticipated

that Freehold acquisition activity will be broadly in

line with previous financial years.

Michael Murray

Chief Executive Officer

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

FINANCIAL REVIEW

The Financial Statements for the Group for the 52 weeks

ended 24 April 2022 are presented in accordance with

International Financial Reporting Standards (IFRS).

Summary of Results

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Revenue

4,805.3 3,625.3

Reported profit before tax

335.6 8.5

Adjusted PBT

(1)

339.8 (39.9)

Earnings per share (EPS)

Pence per share Pence per share

Reported basic EPS

52.9 (16.5)

Adjusted basic EPS

(2)

53.9 (27.3)

(1) Adjusted PBT is profit before tax less 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. Further detail on this

calculation can be found in the Glossary.

(2) Adjusted basic EPS is reported basic EPS less 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. Further detail on this

calculation can be found in note 15.

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.

As at 24 April 2022 and as detailed in note 30c, the

Group had the following forward contracts that

qualified for hedge accounting under IFRS 9 Financial

Instruments, 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 480m FY23 1.41

USD / EUR

USD

inventory

purchases

USD 120m FY23-FY24 1.26 – 1.31

EUR / GBP

Euro sales EUR 600m FY23, FY25 0.99 - 1.08

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 Financial Instruments. 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 / EUR

USD

inventory

purchases

USD 120m FY23, FY25 1.26 – 1.31

EUR / GBP

Euro sales EUR 740m FY23, FY26 0.99 - 1.08

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, and discusses and understands

appropriate financial products with various financial

institutions, including those within the Group Revolving

Credit Facility (RCF). 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,

to implement additional strategies and / or restructure

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.

Taxation

The effective tax rate on profit before tax in FY22 was

23.5% (FY21: 1,017.6%). The prior year was impacted by

more significant property impairments and disallowable

depreciation compared to FY22.

FRASERS GROUP PLC ANNUAL REPORT 2022

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

24 April 2022

52 weeks ended

25 April 2021

Pence Per Share Pence Per Share

Reported EPS (Basic)

52.9 (16.5)

Adjusted EPS (Basic)

(1)

53.9 (27.3)

Weighted average number of

shares (actual)

471,975,282 501,955,281

(1) 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. Further details can be found in

the Glossary.

Dividends

The Board has decided not to pay a final dividend in

relation to FY22 (FY21 £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 £323.2m (FY21: £219.4m), which

included £121.3m on freehold and investment properties

(FY21: £84.3m) and £36.8m on warehouse automation

(FY21: £48.5m).

Strategic Investments

The Group continues to hold various strategic

investments as detailed in note 21. In addition, the Group

also holds indirect strategic investments within contracts

for difference and options.

The fair values of the contracts for difference and options

are recognised in Derivative Financial Assets or Liabilities

on the Group Balance Sheet, with the movement in fair

value recorded in the Income Statement.

Acquisitions

On 25 February 2022, the Group acquired the entire

share capital of Studio Retail Limited and certain other

assets of Studio Retail Group Plc (in administration).

The consideration for the transaction comprised cash

and the release of SRG from its liabilities to the lending

banks under its revolving credit facilities resulting in

a cash payment by Frasers Group to the lenders of

£28.3m. As Frasers Group seeks to elevate its customer

journey including a flexible repayment proposition,

the acquisition of SRL will provide Frasers Group with

expertise and synergies that will accelerate this ambition.

Related Parties

MM Prop Consultancy Limited, a company owned and

controlled by Michael Murray, who is a member of key

management personnel as per IAS 24, continued to

provide property consultancy services to the Group

during FY22. During FY22, MM Prop Consultancy Limited

was primarily tasked with finding and negotiating the

acquisition of new sites in the UK, Europe and Rest of

the World, for both our larger-format stores and our

combined retail and gym units but it also provides

advice to the Company’s in-house property team in

relation to existing sites in the UK, Europe and Rest

of the World.

In the year, all properties have been assessed

that are considered to have created value across

all the outstanding freehold and long leasehold

properties over the applicable period from the MM

Property Consultancy agreement commencement

to 29 September 2021, they have been valued by an

independent valuer who confirms the value created by

MM Prop Consultancy Limited. The Group’s independent

Non-Executive Directors then review and agree the value

created and have full discretion to approve a payment

to MM Prop Consultancy Limited of up to 25% of

the value created.

On 1 May 2022 Michael Murray was appointed as

CEO. Prior to his appointment MM Prop Consultancy

Limited and Frasers Group finalised the terms on which

any relevant prior consultancy services agreements

are terminated. The Board has now completed its

assessment of the unsettled value created by MM Prop

Consultancy Limited to the Group, with the assistance of

independent third-party experts.

MM Prop Consultancy Limited is entitled to up to 25%

of any value created by services provided to the Group.

MM Prop Consultancy Limited has agreed to waive

contractually due amounts, including part crediting

previous payments under this agreement, such that

the Group receives a 40% discount as part of the

finalisation and cessation of the consultancy agreement.

The final payment to be made by the Group to MM

Prop Consultancy Limited following the application of

this discount is £20.9m which was paid in the year (FY21:

£2.5m was accrued and subsequently paid in FY22).

FRASERS GROUP PLC ANNUAL REPORT 2022

During FY21 the Group entered into an agreement

with M.P.M Elevation Limited, a company owned and

controlled by Michael Murray, in relation to Elevation

strategy services. M.P.M Elevation Limited was paid

£0.1m in relation to the provision of the Elevation

strategy services (FY21: £0.1m).

Other related parties are disclosed in note 35.

Cash Flow and Net Debt

Net debt increased by £242.2m, from £248.9m at 25 April

2021 to £491.1m at 24 April 2022 (including the £232.0m

borrowings acquired due to the acquisition of Studio

Retail). Interest on bank loans and overdrafts increased

to £13.6m (FY21: £11.1m) largely due to increased usage of

the RCF in the period.

Analysis of Net Debt:

24 April 2022 25 April 2021

(£m) (£m)

Cash and cash equivalents

336.8 457.0

Borrowings

(827.9) (705.9)

Net debt

(491.1) (248.9)

On 30 November 2021 the Group refinanced its existing

borrowings and entered into a combined term loan and

revolving credit facility of £930.0m for a period of three

years, with the possibility to extend this by a further two

years. This facility increased to £940.0m as at 24 April

2022 and to £980.0m subsequent to the period end.

The Group continues to operate comfortably within its

banking facilities and covenants and the Board remains

comfortable with the Group’s available headroom.

Note: Due to the timing of payroll and supplier

payments, net debt at calendar period end 30 April 2022

was materially higher than at 24 April 2022.

Cash flow:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Cash inflow from operating activities

628.9 578.3

Income taxes paid

(121.0) (59.3)

Invested in:

Purchase of subsidiaries, net of cash

acquired

(0.2) (39.4)

Purchase of listed investments

(198.4) (113.3)

Proceeds on disposal of listed

investments and derivatives

238.4 7.0

Proceeds on disposal of subsidiary

undertaking

1.0 -

Proceeds in relation to equity

derivatives

117.4 48.1

Net capital expenditure

(280.2) (192.3)

Exchange movement on

cash balances

0.1 (5.3)

Investment income received

1.0 0.5

Finance income received less finance

costs paid

(26.5) (22.6)

Lease payments

(176.2) (78.0)

Purchase of own shares

(193.2) (4.3)

Borrowings acquired through

business combinations

(232.0) -

Repayment of acquired debt

- (1.4)

Dividend paid to non-controlling

interest

(1.3) (0.9)

(Increase) / decrease in net debt

(242.2) 117.1

Summary of Consolidated Balance Sheet

(Extract)

24 April 2022 25 April 2021

(£m) (£m)

Property, plant and equipment

816.3 915.2

Right of use assets

194.7 249.7

Investment properties

89.2 14.1

Long-term financial assets

206.6 263.3

Deferred tax assets

100.8 66.8

Inventory

1,277.6 1,096.6

Trade and other receivables

841.4 546.5

Provisions

433.0 361.2

Trade and other payables

729.8 646.3

Lease liabilities

620.6 722.7

Borrowings

827.9 705.9

The majority of the decrease in property, plant and

equipment relates to the impairments of freehold land

and building and plant and equipment due to the

significant economic factors which are headwinds on

the business, including challenges with supply chain,

increased energy costs and cost of living.

FRASERS GROUP PLC ANNUAL REPORT 2022

IFRS 16 right of use assets have decreased largely due to impairments. Lease liabilities have decreased largely due to

lease payments during the period.

Long-term financial assets have decreased during the period due to the reduction in the valuation of Studio Retail

Group plc.

Inventory has increased due to the acquisitions in the period, these being the single individual reason.

Receivables includes a £88.3m reimbursement asset in relation to the Group’s ongoing non-UK tax enquiries (FY21:

£118.3m), £243.9m relating to deposits in respect of derivative financial instruments (FY21: £131.0m) with the increase

mainly relating to Hugo Boss and £234.2m credit customer receivables relating to the Studio Retail business (FY21: £nil).

Provisions have increased mainly due to the acquisition of SRL in the period.

Payables have increased largely due the acquisition of SRL in the period.

Summary of Company Balance Sheet (Extract)

24 April 2022 25 April 2021

(£m) (£m)

Investments

1,443.6 1,494.9

Debtors

512.8 162.9

Creditors: amounts falling due within one year

(985.7) (609.0)

Investments relates to investments in subsidiaries and long-term financial assets. The majority of the decrease relates

to Studio Retail Group Plc.

The majority of the movement in debtors relates to an increase in collateral to cover margin requirements for derivative

transactions held with counterparties.

Creditors largely relates to amounts owed to

Group undertakings.

Chris Wootton

Chief Financial Officer

20 September 2022

NONFINANCIAL INFORMATION

The table below sets out where the information required by sections 414CA and 414CB of the Companies Act 2006 can

be found in this Annual Report.

Requirement Location Relevant Policies

Environmental Matters Environment pages 38 to 39 Environmental policy

Employees ESG Report pages 33 to 37

Staff Handbook

Employee Data Privacy Statement

Acceptable Use Policy

Social Matters* ESG Report pages 33 to 37

Human Rights ESG Report pages 33 to 37 Anti-Slavery and Human Trafficking Policy

Anti-Bribery & Corruption policy ESG Report pages 33 to 37

Staff Handbook Anti-Bribery & Corruption policy

Whistleblowing Policy

Code of Conduct / Supply Policy

* We continually work to ensure that we improve in this sector. Our policy is not sufficiently formalised although evidence of what we do can be located on pages 33 to 37.

FRASERS GROUP PLC ANNUAL REPORT 2022

WORKERS’

REPRESENTATIVE REPORT

I have now been in the role of Workers Representative

and Non-Executive Director for three years and during

this period, my relationship with both my colleagues and

the Board have gone from strength to strength.

Although this past year has had challenges for the

retail sector as a whole, this has not detracted from

the wellbeing and development of our people being a

key focus. I continue to have full control and ownership

of the colleague welfare portal, where every colleague

has the opportunity to raise concerns or queries directly

to me. I operate with complete transparency and any

findings from these platforms are shared with the rest

of Board or, if appropriate, in accordance with our

whistleblowing policy.

A key success of my role this year was being able to host

and present to all our Retail Managers at conferences

held at our London and Shirebrook offices. At the

conferences, we celebrated our people and rewarded

every Manager with a selection of gifts for their efforts

over the past year, including a number of points under

the Fearless 1000 scheme to managers and

their colleagues.

Furthermore, I am pleased that despite the challenges

that the retail sector faces, this year we have revived our

retail colleague bonus and launched new reward and

recognition incentives, reinforcing the value we place

in our people.

Continuing my focus on our people, I am working across

the UK facilitating focus groups with colleagues of

varying seniority and experience to ensure our people

are consistently given a platform for their voices

to be heard.

This year, I have attended both the Remuneration and

Nomination committees, so I have full transparency and

insight into everything at Board level. This has not only

proved useful to me for my own personal development

but has given me a greater depth and understanding of

the topics that are discussed at Board level. With each

passing year, I am confident that I continue to add value

to both our Non-Executive and Executive teams.

I am looking forward to the year ahead and supporting

our incoming CEO Michael Murray, to ensure that

Frasers Group continues to place our people at the heart

of the business.

FRASERS GROUP PLC ANNUAL REPORT 2022

ESG REPORT

Our People

We have approximately 30,000 people across the Group.

Building on strong foundations around how we manage

and support our people, during FY22 we have continued

to invest in and improve the experience of working for

Frasers Group.

Culture and Values

Our culture and values continue to be integral to the

environment we are creating for our colleagues to

work in. We have maintained a focus on embedding

our values through every aspect of the colleague

journey, including recruitment, reward and recognition,

leadership and learning and how we measure

performance. Having this thread running through our

approach around people ensures we are clear about

what is important and what success looks like, so our

people understand how they can develop and progress.

Our values are:

• Own it and back yourself

• Don’t hesitate and act with purpose

• Think without limits and take the team with you

This year we have developed our recruitment process

to include a specific culture and values assessment,

ensuring that we select those people who are most

aligned with our business and ways of working,

improving their experience and their chances of

achieving success with us.

We have also focused on continuing to drive awareness

of Frasers Group as an employer externally, driven by a

social media strategy designed to:

• raise the reputation and profile of Frasers Group;

and

• bring the organisation to life for potential

future talent.

This strategy has driven an increase in followers of 71%

across our Frasers Group Linked In account and an

increase in followers of 34% on Instagram. We have also

undertaken an external survey, representative of the UK

working population, with our specialist employer brand

partner and we learned that 78% of those who are

aware of Frasers Group would consider working for us.

We also recognise that internal communication is

an integral part of engaging our colleagues with

the business and our culture and this year we raised

the bar with a significant levelling up in our internal

communications approach. We have delivered

a monthly newsletter from our senior leaders to

all colleagues, updating on key events across the

organisation, as well as regular updates celebrating our

success through programmes like our monthly Frasers

Champion awards, weekly round ups of all comms

messages and more focus on driving function updates

via our central comms teams, to improve consistency

and accessibility.

We also held our first Retail Managers Conference in

over two years following the pandemic. This event

saw our Retail Managers across the UK and Europe

come together over three weeks to thank them for their

hard work and dedication during the pandemic and

to recognise their incredible efforts since returning to

work. Here we also re-invigorated our retail incentive

schemes, recognition events and awarded points under

our Fearless 1000 bonus scheme (more details below).

We also held dedicated conferences for the first time for

some of our key support functions across the business.

Attraction

We aim to hire the best people within each discipline

across our organisation. Our ability to do so is key to our

strategy and success.

This year, we launched a new careers website, designed

to engage and educate potential new hires about

who Frasers Group are, our culture and values and the

people who make our business what it is. This was also

underpinned by the introduction of a new Applicant

Tracking System, to improve our ability to source the best

candidates for all roles across the business and improve

the experience our candidates have when applying for

roles with Frasers Group.

We understand that one of the best ways to find people

who are suitable for our organisation is through the

recommendation of people that already work for us, so

this year we also re-launched an internal referral scheme,

encouraging colleagues who work for us to recommend

people they know for key roles.

Retention

Alongside hiring the best people, we aim to retain their

knowledge, skills and commitment within the Group.

FY22 saw one of the most challenging landscapes

for colleague retention in recent times and as a result,

we saw an increase in the attrition of our UK salaried

colleagues to 33% (29% in FY21). Pleasingly however,

across our Store Manager population within Sports

Direct, our stability increased to 91% from 84% in FY21.

Our Assistant Manager stability increased to 87% from

86% and our Footwear Manager stability decreased

slightly to 91%, compared to 94% in FY21.

FRASERS GROUP PLC ANNUAL REPORT 2022

Development

Continuing our objective of populating the organisation

with high-calibre, well trained people to be the future

leaders of Frasers Group, this year we have started

an investment of over £1m in the development of our

people. We have introduced a new Head of Learning &

Development to shape and develop a comprehensive

offering of operational, technical and soft skills

development. Our new group L&D team provides a

shared service across the business, with a key focus

on management and leadership development, retail

capability, commercial training and the learning

experience of our colleagues. We have also invested in

new ‘Head of’ roles in each of these areas and, true to

our core principles around promoting from within, all of

these roles have been filled by internal talent.

We have already launched a new Leadership Academy,

which houses a trio of options for our people leaders

across the Group. These include premium digital

on-demand content from our strategic partners

Sporting Edge, our own in-house development

programme, Managing Without Limits, as well as access

to professionally accredited qualifications from the

Chartered Management Institute (CMI) in partnership

with Corndel and Imperial College’s Business School.

We have also kicked off our most significant cohort of

internal apprenticeships yet, with 154 people from our

early career talent pool enrolled on our new Retail Team

Leader programme, investing almost £700k from our

apprenticeship levy funds.

Within Retail, we have revised our new store on-boarding

programme for Management colleagues and developed

a new programme for our CAST teams to ensure that

they receive a World class start to their careers with

Frasers Group.

We have also undertaken a full refurbishment of our

Shirebrook Learning Academy facility, with significant

investment in new technology and an upgrade of our

facilities, with a focus on improving the representation

of all our Group fascias and further enhancing the

experience colleagues have when they come to

the campus.

Diversity and Inclusion

Frasers Group is a company of growth, elevation,

determination and a global community of diverse

and talented people. We welcome and celebrate

individuality and take pride in only allowing a

colleague’s contribution to define their path. We

empower individuality through our core values and

our attitude is championed within our brands through

diversity and inclusion amongst sport, fashion and

lifestyle, and is a considered and crucial part of our

approach. As we continue on our elevation journey as

one team, we are clear that the success of our business

is dependent on the success of our colleagues. We

aspire to create an environment where everyone can be

the best that they can be, every day. To us, diversity and

inclusion are about being the business that our people

want us to be.

We will not tolerate discrimination on grounds of gender

identity, sexual orientation, race, nationality, religion, age,

disability or any other grounds.

Included in our Management Without Limits programme,

launched in FY22 is an entire module dedicated to

promoting difference within our workforce, to help our

managers understand the importance and benefits of

diversity and inclusion and educate them on concepts

like conscious and unconscious bias.

We endeavour to meet our responsibilities to train and

employ disabled people. Applications for employment

by people with any disability are given full and fair

consideration for all vacancies and are assessed in

accordance with their skills and abilities. People who

have a first language other than English are important

to our business. In our Warehouse, we have this year

begun the introduction of personalised workwear

to enable easy identification of colleagues’ native

language and we are also offering translators in training

and meetings.

The table below shows the gender diversity of our

workforce at the period end. Approximately 54% of

our workforce is female, including 36% of our senior

management and their direct reports (FY21: 35% UK

workforce). We aim to ensure that both male and female

candidates are provided with equal opportunities to

apply for and work in all positions across the Group.

Female Male

Directors

29% 71%

Other senior managers and

direct reports

36% 64%

Other employees

55% 45%

FRASERS GROUP PLC ANNUAL REPORT 2022

Gender Pay Gap

Our gender pay gap report for 2021 was published

in April 2022. We are pleased to report that we have

maintained a 0% average gender pay gap across the

Group for three years in a row, compared to 6.3% in 2017.

We continue to work vigorously on aligning roles and

putting transparent structures in place across all areas

of the business. When it comes to rewards, we have

been lifelong champions of growth in earnings through

performance related bonuses. We encourage all our

people to reach their maximum potential and reward

the achievement of appropriate targets, set within the

respective discipline of the business. This is reflected

in the high percentage of males and females earning

a bonus, which are all gender neutral by design, and

continues to reflect the equality which we strive to

achieve across our business.

We recognise there is a difference in total earnings

between female and male colleagues. We are therefore

continuing to explore and implement methods that will

establish enhanced processes and training tools for our

employees and engaged workers, to achieve maximum

earning potential through our various bonus and

commission schemes (more details of which below).

Talent and Capability Development

Our strategy and future goals rely significantly on our

ability to nurture and grow the best talent in our industry,

and this year, alongside the investment in our people

development capability mentioned above, we have

continued to build on our ability to identify and support

talent to progress within Frasers Group.

This year, we have continued to run our Fearless Focus

performance review process, aligning individual goals

to our broader Group objectives and ensuring that every

colleague has a clear plan to progress their careers. This

has also enabled us to identify those colleagues who

we believe have the potential to develop and grow to

become future leaders of our organisation.

We have also introduced new leadership roles across

our Retail, Digital and Technology and IT functions,

to ensure that we have the right people at the right

level to support the achievement of our goals and the

development of future talent within their business areas.

We have also re-organised our structures within our

Retail and Commercial functions to align with our Sports,

Premium and Luxury pillars, ensuring these key teams

are best positioned to deliver our purpose and strategy.

We have continued to see success from our Elevation

Programme, with two colleagues from our first cohort

being promoted into senior leadership roles in our

Commercial team at the end of their second year in the

programme. We have also seen our second cohort of

25 new colleagues start their programme in September

2021 and the recruitment for cohort three being

completed, with another 26 high-potential individuals

who joined Frasers Group in September 2022. We

levelled up our approach to attracting the best calibre

of early careers talent this year, running an onsite and

digital marketing campaign that saw us voted third in

the category for Best Student Marketing Campaign at

the National Graduate Recruitment Awards 2022. We

also extended our Elevation Programme to our Finance

team in FY22, with five new graduates recruited, who

joined in August 2022.

Remuneration and Reward

We foster a reward-based culture that enables our

colleagues to share in the Group’s success. In the UK,

our policy is to pay above the National Minimum Wage,

including rates that are above the National Living Wage

for people aged over 25. We offer bonus schemes and

incentives depending on the role and the fascia, and

colleagues receive discounts across all fascias.

In FY22, we started the year with a full review of our

Retail pay structures, resulting in increased rates of pay

across the board, including management and casual

workers. In November 2021, we also re-invigorated our

Retail commission and bonus structures, making them

more accessible than they have ever been before and

paying out over £15m to our colleagues through our

bonus and commission schemes over the course of this

financial year.

We also reviewed our Fearless 1000 bonus scheme and

made a number of changes, to ensure that the scheme

is working in the best interests of our colleagues.

These included:

• extending the scheme for a further 12 months to

account for the impact of the pandemic in the first

year of the scheme and increase the opportunity to

achieve the goal of hitting the £10 share price for 30

consecutive days;

• increasing the number of points available to retail

leaders to recognise the number of people under

their remit; and

• moving the points allocation window to half yearly

to enable more time for great work to be visible to

senior leaders who are awarding points to

our colleagues.

FRASERS GROUP PLC ANNUAL REPORT 2022

Casual Workers

We strive to ensure our arrangements for casual staff

are fair and equitable. All casual workers are paid the

same rates as permanent employees in the same role.

We promote stability in working hours, while our casual

workers also benefit from the flexibility to decline shifts

at any time. This flexibility also benefits the Group,

enabling us to adjust staffing levels to cope with peak

times and quieter periods.

Casual workers are also included in our commission

schemes and in the Fearless 1000 bonus scheme.

Health and Safety

The Group’s health and safety programme has

continued to evolve, to support business growth. The

Company has safely operated through the Covid-19

pandemic and we have successfully implemented

a number of significant general health and safety

improvement measures that we are confident will help

drive and support our continuous improvement plans.

Over the last 12 months the Company continued to

respond effectively to the Covid-19 pandemic. Across

our distribution, office and warehousing operations and

together with our retail team, we maintained robust

social distancing and cleaning policies, meeting or

exceeding guidelines, to ensure customers were able

to enjoy a safe retail experience and maintain a safe

workplace for our teams.

We have implemented a number of measures to

strengthen our health and safety programme, focusing

on identifying and sharing good practices across the

business and, where appropriate, harmonising our

health and safety policy and procedures. Specific

initiatives include:

• the introduction of a bespoke online accident

reporting system, which is delivering improved

accident reporting and data analytics to inform

organisational learning and accident prevention;

• a significant increase in our Health and Safety team

in our Shirebrook warehouse to provide additional

expertise and support for our operational teams;

• supporting the retail team to help implement and

sustain in-store health and safety standards; and

• investing in our health and safety capabilities with

our regional H&S officers undertaking specialist

training on fire risk assessments.

We continue to positively engage with fire service and

local authority enforcement representatives and there

have not been any environmental enforcements or

prosecutions in the past 12 months.

All accidents and incidents are investigated in a timely

manner, to prevent recurrence.

The Group’s Reporting of Injuries, Disease and

Dangerous Occurrences (RIDDOR) incidents in the last

12 months all involved over seven-day incapacitation. In

total six incidents were reported in FY22, a reduction of

45% on the 11 incidents reported during FY21.

The accident rate for the distribution, office and store

workforce was 2.5 accidents per 100,000 hours worked

in FY22, an increase on the rate of 1.8 compared to

FY21. A direct comparison between periods is adversely

affected by extended periods of Covid-19 related

disruption, across operations and teams, including store

closures. The FY22 rate is more representative of regular

business activity.

In prior years, we have calculated the number of

accidents to the general public as a rate per £10m of

store turnover, using a 12-month rolling average. The

FY22 accident rate was 6.6. A comparison with FY21

is not considered to be meaningful, given the impact

of Covid-19 restrictions and associated store closures

during this period.

During FY23, we will pursue our continuous improvement

programme to further develop and sustain effective

health and safety across the business.

Wellbeing

Colleague wellbeing continues to be a focus for us,

as the understanding and importance of health and

wellbeing and its impact on our colleagues grows. We

maintain and have further embedded our relationship

with the Retail Trust this year. Our partnership gives all

Frasers Group colleagues access to free and confidential

wellbeing support, including advice, financial assistance,

face-to-face and telephone counselling, cognitive

behavioural therapy, non-repayable grants, career

development support, legal guidance and on-site critical

incident support. The helpline is available 24 hours a

day, seven days a week. We also offer an enhanced

counselling referral service to colleagues who require a

greater level of support.

In FY22 we have developed and launched a mental

health and wellbeing series through our digital learning

platform for colleagues and managers, to access

support people who are dealing with issues related to

their mental health.

FRASERS GROUP PLC ANNUAL REPORT 2022

Human Rights and Modern Slavery

We are committed to respect and maintain equal

treatment for all people.

We recognise that modern slavery is an ongoing

challenge for organisations, especially those dealing

in consumer goods, and we remain committed to

addressing this risk. Ultimately, we strive to ensure that

no slavery or human trafficking takes place within our

business or supply chain. We have policies in place

aimed at proactively identifying and mitigating these

risks. These policies aim to send a clear message that we

do not tolerate these practices.

We have a range of tools in place, including videos and

literature to educate colleagues about their rights, and

a number of communication channels, including an

internal telephone hotline and comment boxes on site,

for reporting any feedback or concerns. Anyone making

a report can remain anonymous if they choose. We also

continue to review and develop our colleague training,

monitoring processes and evaluation of outcomes, and

work with our employment agencies and other relevant

bodies, including the Gangmasters and Labour Abuse

Authority and the police, to support our training

and knowledge.

If we find, or suspect, that any organisations or

individuals are participating in modern slavery, we will

take immediate action. Accordingly, we have a policy of

reporting any suspicious activity to the police, who have

historically assisted in ensuring successful convictions.

Our s54 Modern Slavery Act statement can be found on

our website www.frasers.group.

Community and Charity

We are committed to engaging with the local and

wider communities around our stores and our offices in

London and Shirebrook, and we aim to minimise any

detrimental impact on them.

Our Sports Directory subsidiary has been a specialist

supplier of sports equipment to the education sector

for nearly 30 years, and part of the Frasers Group since

2016. Sports Directory plays a key role in giving back to

schools in the UK and helping to keep our young people

fit and healthy. Through its ‘My School’ scheme, schools

purchase sports equipment from Sports Directory and

the business gives them the opportunity to claim a

voucher for every purchase. To date, Sports Directory

has issued over 65,000 vouchers to UK schools, which

equates to more than £4.5 million worth of free

sports equipment.

Sports Directory has also, via the Professional

Footballers’ Association, donated free equipment to 72

football league clubs, helping to support

local communities.

For more information on Sports Directory visit: www.

sportsdirectory.com

The Group has also run campaigns to encourage

children to become active in sport. This included the

Monster Kickabout campaign launched by Eric Cantona.

Over 3,000 schools participated in this campaign and

the Group donated £500,000 of football kits to the

schools. Four schools were also given the experience of

a lifetime at St George’s Park, where they received the

opportunity to train with FA coaches.

Anti-Bribery and Corruption

The Group has an Anti-Bribery and Corruption Policy

in place, which was originally created following the

introduction of the UK Bribery Act. As a result of the

Act, all policies and procedures were reviewed to ensure

compliance measures were put in place to mitigate

colleagues being offered and/or accepting bribes.

We have a zero-tolerance approach to bribery and

corruption at Frasers Group, and we encourage our

people to speak up if they have concerns that bribery or

fraud is taking place. No instances of bribery, corruption

or fraud have been reported during FY22.

Whistleblowing

The Group has an approved whistleblowing policy and

a number of processes in place which support our policy,

including Your Company Your Voice, our Retail Support

Unit Asset Protection hotline, as well as a dedicated

whistleblowing e-mail address.

During the financial year the Audit Committee reviewed

and recommended to the Board the approval of an

updated Whistleblowing Policy, which was subsequently

adopted by the Group and rolled out to colleagues.

FRASERS GROUP PLC ANNUAL REPORT 2022

ENVIRONMENT

ESG is an increasingly important area to Frasers Group.

We recognise the importance of sustainability to our

stakeholders and to the future success of the business

and take seriously the part we must play to change the

paradigm of the retail and manufacturing industries.

We welcome the progress made at COP26 and

are actively working with our partners to identify

opportunities to work together to tackle climate change,

particularly in relation to carbon emissions from

transport and waste.

Frasers Group supports the introduction of the Taskforce

for Climate-related Financial Disclosures (TCFD).

Significant analysis and scenario modelling went into

producing our disclosure. The findings have given us

a robust foundation to mitigate climate related risks

and inform opportunities going forwards. Our full TCFD

disclosure can be found at page 40.

The role of the sustainability team continues to evolve as

we further embed sustainability throughout the Group,

linking sustainability to Group strategy and vice versa.

TCFD has further helped to formalise this approach

and the Group’s sustainability manager is an integral

member of the newly formed Climate Risk Group.

There has been a particular focus on materiality and

data gathering over the past year, to better inform the

direction of the Group’s ESG journey. Notably, there

has been improved data collected on energy use and

savings, product material composition and

single-use plastic.

We expect continued improvement in the quality of data

we collect and in the way we use and share that data, to

better inform agile decision making as the information

and the opportunities that presents become clearer.

Campaigns through the year included our Save the

Bumblebees campaign, which aimed to engage and

educate our customers on biodiversity, giving out

free seeds and information booklets and temporarily

rebranding our popular Sports Direct bag for life and

mug with the #savethebumblebees logo.

Carbon

This continues to be a priority focus area for the Group,

as evidenced by our newly created Carbon Reduction

Manager role. It is one of the areas where we have made

significant improvements in data gathering and

target setting.

The plans we already had in motion last year to reduce

our energy use and emissions have cushioned the Group

from some of the impacts of a volatile energy market

and associated increased energy costs and will continue

to bring cost savings year on year. This approach has

bought about both commercial and environmental

benefits.

Of note, we have accelerated our LED upgrade

programme, investing more than £5M in replacing LED

lights in 124 stores and 1 warehouse. The project will save

more than £2.5M per year (as an average of our energy

costs last year) and more than 3.0Mtco2e annually.

We also introduced a store colleague incentive to reduce

energy use, dubbed ‘Top of the Shops.’ The incentive

rewards store colleagues for best practice in energy

saving measures, such as ensuring the escalators were

only turned on when the stores are open to customers.

Impacts of the savings were communicated to stores

regularly and stores were able to measure themselves

against each other in a Top of the Shops league table,

fostering healthy competition. We were delighted with

the engagement level from store colleagues. We had

forecast a 10% reduction in UK electricity use for the

year but exceeded this to achieve a 15% reduction

(from a 2019 baseline, measured against like-for-like

stores. 2019 baseline used as a comparative year due to

coronavirus lockdowns affecting data in 2020 and

early 2021).

Our pilot trial of infrared overdoor heaters has

demonstrated their improved efficiency compared to

the traditional electric blow heaters. Infrared heaters will

now be installed as standard practice in all new stores

and store refits.

We installed 18 EV charging points at our warehouses

last year which have been well utilised by colleagues

and visitors.

Aside from our estate, we have also been working

hard to reduce emissions in our supply chain, notably

from delivery of goods, building on the success of our

pioneering container optimisation programme which

maximises the space used per container. We have

further expanded the number of brands we collaborate

with and have also increased the number of deliveries

that are optimised from our existing brand partners.

Delivering to us in this way reduces the number

of deliveries by 25% on average. That means

approximately 25% has been saved in delivery costs and

the greenhouse gases associated with those deliveries.

Container optimisation complements our growing

automation system, reducing manual handling and

processing time from leaving port of origin, to arrival

with our customers.

FRASERS GROUP PLC ANNUAL REPORT 2022

For last mile deliveries, customers now have the option

to select DPD Carbon neutral delivery at check out.

Approximately 32.1tco2e was saved in FY22 by customers

selecting this option.

Acknowledging the urgency of the climate crisis, Frasers

Group’s primary focus for the coming year will be to

further investigate our scope 3 emissions and gather

decision-useful data, to enable us to target high-impact

areas effectively.

Frasers Group has responded to the Science Based

Targets initiative’s (SBTi) urgent call for corporate climate

action, by committing to align with 1.5°C and net-zero

through the Business Ambition for 1.5°C campaign.

The Group now has 24 months to submit a target for

validation to the SBTi.

Waste

Waste has always been managed very well from our

Shirebrook DC and we have detailed collection data

going back to 2014. In FY22 we recycled 86% of our

waste, of which 68% was cardboard.

This last year we modernised the way we collect and

share information to help further improve our recycling

rates. We have set a target for FY23 that 90% of

the waste that goes through Shirebrook DC will be

recycled. This includes even more packaging waste that

we expect to receive back from our stores, due to the

store recycling initiative that is being piloted, to drive

behaviour change and bring down waste rates. We are

proud of this achievement, as reducing waste has a

big impact on the environment. However, we recognise

that whilst perfecting the system at Shirebrook DC, we

have not had the same focus on our other warehouses.

We acknowledge that we have a lot of work to do in

collecting baseline data for those and looking at the

systems in place to see where improvements can

be made.

Packaging

Detailed data is being gathered on the material

composition of the Group’s own-brand core

product packaging, to enable us to look for more

environmentally responsible alternatives such as FSC

card and alternatives to virgin plastic packaging. This

work was already being undertaken to reduce and

improve the packaging we use but has been accelerated

and other streams of data added, to account for the

Plastic Packaging Tax that came into force in April 2022.

The additional data collection also brought into scope

other plastics we procure, such as e-commerce and

carrier bags. All of our carrier bags are now fully FSC

certified and recyclable or from 100% recycled and

recyclable plastic (80% post-consumer waste, 20%

factory waste).

We are in a strong position to report for the tax

requirement and have already been able to implement

changes to some of our packaging to remove or reduce

plastic content, thereby falling out of scope for the tax

whilst improving the environmental impact.

Elevated Product

Frasers Group acknowledges its responsibility as part

of the fashion industry to reduce the amount of textiles

waste that is sent to landfill and to maximise the full

value of textiles already in circulation.

As part of the Elevated Product pillar of our strategy, we

have gathered data on the material content of 91% of

our own-brand core textile products. This will give better

visibility of the composition of materials we use and

enable us to choose more sustainable materials in the

future. We are in a good position to report the first-year

submissions to the Textiles 2030 initiative, of which we

are a member.

For Spring/Summer 2022, 100% of our own-brand

seasonal swimwear was from 100% recycled nylon

and we plan to extend use of recycled nylon across the

ranges for next year, as well as working with our brand

partners to encourage the use of more sustainable fibres

in third-party products.

Looking at circularity in fashion, we are delighted to

announce our partnership with Sharewear in piloting

a clothing take-back scheme, which launched in five

House of Fraser stores in April 2022. Sharewear’s unique

ReLived scheme is the only clothing collection scheme

that guarantees all useable clothing will go to someone

in poverty in the UK, free of charge. The collaboration

is part of Frasers Group’s commitment to reduce our

impact on the environment by ensuring that textiles

are kept in use for as long as possible. Not only does

this initiative protect the environment, but it also helps

people in need in our local communities. Frasers Group

was the only retailer to pilot the scheme with Sharewear,

providing a supply of clothing that enabled people to

attend interviews, leading to work and training, and send

their children to school warm and dry.

Future Progress

We are pleased with the progress made during the last

year and recognise that there is much more work to do

in all areas of sustainability.

Whilst we are keen to address every issue with urgency,

we are mindful that it takes time to deliver large scale

adjustments and we are committed to working with our

partners and colleagues to deliver changes that are long

lasting and impactful.

FRASERS GROUP PLC ANNUAL REPORT 2022

TASK FORCE ON CLIMATE

RELATED FINANCIAL

DISCLOSURES TCFD

Frasers Group supports the aims of the TCFD, which

we believe is an important step in tackling climate

change. In this section of the report, we are making

the disclosures recommended by TCFD, to provide

stakeholders with useful information on climate-related

risks and opportunities relevant to our business.

During the year, we have worked closely with expert

external advisers to enhance our understanding of the

potential impact of climate change on Frasers Group

and to inform our future strategy, risk management

approach and the metrics and targets we will use to

monitor our progress. This work has included:

• a gap analysis, to identify key gaps between our

practices and the TCFD recommendations;

• identification and shortlisting of our key potential

climate-related risks and opportunities;

• qualitative scenario analysis for both physical and

transition risks and opportunities, over time and

across two different temperature scenarios; and

• development of actions to integrate climate-risk

considerations into our Enterprise-wide Risk

Management framework (ERM).

The two temperature scenarios we considered were

increases of 1.5oc and 4oc above pre-industrial levels.

We selected two pathways as we identified that there

are two potential futures ahead of us. A scenario where

we actively move towards a lower-carbon economy to

keep warming to 1.5oc would introduce more transitional

risks to our business. 1.5oc was identified as a best-case

scenario of the Paris Agreement at the COP21 summit in

2015, was reiterated at the COP26 summit in November

2021, and also aligns with the objectives of the SBTi.

Alternatively, if efforts are not made to limit global

warming to the agreed 1.5oc, we could face a worst-case

scenario of 4oc of warming, which would pose a lot

more physical risks such as extreme weather events.

Governance

The Board has ultimate responsibility for ensuring

effective risk management and that our strategy

takes account of the risks and opportunities we face,

including those related to climate change. The Board

has delegated its oversight of climate-related risks to the

Audit Committee, which reports to the Board on these

matters on a quarterly basis, and are tasked with:

• Monitoring progress against climate-related goals

and targets.

• Continuous review of the Group’s ESG risks

and opportunities.

• Keeping under review the materiality of climate-

related risk and its impact on financial statements.

• Monitoring adherence to externally applicable

sustainability codes and principles.

During the year, our external advisers presented

twice to the Audit Committee, sharing their work

on the identification and assessment of transitional

and physical climate-related risks, and proposals for

enhancing our risk management processes in relation to

climate. Our Sustainability Manager also presented the

external advisers’ findings to the Board in the February

2022 Board meeting.

Going forward, we plan to establish our Climate Risk

Steering Group to manage any current or upcoming

identified risks relating to climate whose responsibilities

will include:

• Providing direction and input into our targets and

goals, and ensure the continual evolution of our

action plans

• Oversight of the delivery of our action plan and

improvement roadmap, targets and emerging

climate-related risks.

Our Sustainability Manager who will be an integral

part of the Climate Risk Steering Group, will then

communicate findings from the Group into the Audit

Committee and Compliance & Risk Group on a

quarterly basis.

FRASERS GROUP PLC ANNUAL REPORT 2022

Reporting to the Climate Risk Steering Group, cross

functional management are responsible for managing

on a day-to-day basis the climate related risks and

opportunities of the business.

The Chief Executive Officer has overall responsibility for

our management of risk, supported by his direct reports,

who are accountable to him for managing the risks that

fall within their remits. In addition, the Compliance &

Risk Group has a range of important roles in relation to

risk management, as described on pages 50 to 62.

Strategy

Scenarios are hypothetical in nature describing a path

of development leading to a plausible future state.

During the year, we worked with our external advisers

to identify the potential physical risks, transition risks

and opportunities that could affect our business in

both a 1.5oc scenario (low physical risk, high transition

risk), as recommended by the TCFD recommendations

and in line with the 2015 Paris Agreement and a 4oc

high emissions (high physical risk, low transition risk)

scenarios. We compiled the list on both a top-down and

bottom-up basis, across each of our business areas. We

refined the list to exclude those where our assessment

of their potential likelihood and impact meant the risks

were not material*, or to combine certain risks (such as

heatwaves and water stress) where they arose from

the same cause.

* The materiality of the climate related risks were assessed by taking into account probability of

failure and productivity loss values over time for each risk and their impact on Frasers Group’

locations and operations using a qualitative approach in line with our risk management

framework.

Physical Risks

From our shortlist of physical risks, we identified the

following potential hazards:

• riverine flooding;

• surface water flooding;

• extreme wind;

• coastal inundation; and

• extreme heat.

To understand the potential impact of these hazards, we

aggregated our business operations into three areas:

sourcing, logistics and retail. Underlying these three

areas are 11 sectors of operation, covering the breadth

of our value chain, as shown in the diagram below. We

then reviewed these sectors across 11 key countries

of operation.

FRASERS GROUP PLC ANNUAL REPORT 2022

Each hazard was assessed for:

• the annual probability of that hazard causing an

asset or sector to stop working, with or

without damage;

• the percentage loss of productive availability of an

asset due to component failure, damage or repair;

and

• the resulting productivity loss for Frasers Group,

weighted by the percentage of sales and

procurement in each country.

This analysis demonstrated that the key physical risks

for Frasers Group are coastal inundation and extreme

heat, and that the potential impact of riverine flooding,

surface flooding and extreme wind are not material. No

significant changes are expected to the Group’s business

model as a result of the analysis, other than considering

a potential other sourcing locations.

For coastal inundation, although there is uncertainty

around the time horizon over which climate related risks

will materialise, we assessed the risk at specific points in

time, such as 2025, 2030 and 2050, representing short,

medium and long term time horizons, across both the

1.5oc and 4oc scenarios. for extreme heat, we considered

the number of median (>35oc) and extremely hot days

(>40oc) in 2030 and 2050, across both temperature-rise

scenarios.

Our assessment of the impact on our productivity and

the range of opportunities to mitigate that impact are

shown in the table below. Overall, we see these risks as

arising in the medium to long term. Without mitigating

actions, we are likely to see the impact of these risks on

the business in around 20 years.

Risk

Potential annual impact

on productivity

Mitigations available &

Business response

Coastal

inundation

• Sourcing: The

annual probability of

occurrence of coastal

inundation causing

closures and disruptions

to operations is likely

to increase over time.

The production of

raw materials and

manufacturing of

garments are sectors

that are likely to have

high productivity loss.

• Logistics: Coastal

inundation resulting

in coastal flooding

could have major

consequences on

transport infrastructure.

Potential productivity

loss impact for both

land and water

transportation is likely

to increase.

• Baseline assessment of

supply chain climate

resilience.

• Focus on countries that

came out as highest risk

in our analysis.

• Engage with

suppliers, brands or

manufacturing units to

develop or improve their

risk mitigations.

• Explore other supplier

bases that are

more resilient.

Extreme heat

• Sourcing: There is

an increase in the

likelihood of extreme

heat events such as

heatwave, drought

etc. materialising and

leading to closure/

stoppage of activities in

supply chains.

• Logistics: The

annual probability

of occurrence of an

extreme heat event

causing disruptions

to Frasers Group’

operations is likely to

increase over time.

• Retail: An increase in

the productivity loss

impact of physical risks

could be felt across

most retail activities.

• Understand supply

chain risks through

engagement, including

suppliers’ business

continuity and

contingency plans.

• Work with suppliers to

mitigate factory-level

operational risks.

• Build an internal data

set to track the effects

of rising temperatures

across locations.

• Explore other supplier

bases that are

more resilient.

FRASERS GROUP PLC ANNUAL REPORT 2022

Transition Risks

The risk identification process described earlier

highlighted several potential risks related to the

transition to a low-carbon economy. These were:

• the cost to transition, as a result of rising energy

costs and the switch to renewable energy generation;

• increased costs of raw materials and production;

• carbon taxes and other carbon-pricing mechanisms;

• regulatory changes, reporting obligations and

increased stakeholder concerns; and

• shifting consumer preferences and supplier

requirements, which also presents opportunities for

us (see below).

We analysed the potential impact of rising costs

of energy, raw materials and production, and the

introduction of carbon taxes or pricing, using our

external adviser’s specialist modelling tools. The effect

of regulatory, reporting and stakeholder changes, and of

shifting consumer preferences and supplier requirements,

were assessed using qualitative reviews, analysis of

trends and identification of key drivers. All of these

analyses were conducted for both the 1.5oc and 4oc

scenarios. This enabled us to project the likely trajectory

of costs, taxes and other variables, to give a potential

impact for each year over the period from 2020 to 2050.

The risks, their potential impacts and the mitigations

available are summarised in the table below. Overall,

while these risks may arise in a shorter timeframe

(less than five years), and continue to impact over the

medium to longer term, we are working to mitigate these

as shown in the table below;

Risk Potential impact

Mitigations available &

Business response

Cost to

transition to

a low-carbon

economy

• Increased energy costs,

as low-carbon energy

and technology tends

to be more capital

intensive.

• Increased capital

expenditure, for

example to implement

renewable energy

generation on Frasers

Group sites.

• Business planning to

factor in higher energy

costs and capital

expenditure.

• Develop a robust

transition plan aligned

to the business strategy.

Increased

cost of raw

materials and

production

• Increased costs and

reduction in profitability

if supplier costs are

passed through as a

result of fluctuating raw

material prices, carbon

price rises etc.

• Engage with suppliers

and gain increased

visibility of supply chain

operations.

• Develop methods to

improve agility of the

supply chain, to avoid

major disruptions.

Carbon tax

and other

carbon pricing

mechanisms

• Increased cost base

as a result of higher

carbon prices, felt

directly or indirectly

across most activities in

the sector.

• Measure Scope 3

emissions, to determine

materiality of supply

chain exposure to

carbon prices.

• Engage with suppliers,

to influence mitigation

of supply chain

emissions.

• Identify products

that are less emission

intensive.

Regulatory

changes,

reporting

obligations

and increased

stakeholder

concerns

• Regulations are

changing rapidly,

adding to existing

reporting requirements.

• Insufficient

transparency in our

operations could

lead to litigation and

reputational risks.

• Set up repeatable

climate-related data

collection processes.

• Engage with

stakeholders to enable

oversight of new

regulatory requirements.

• Regular stocktakes

and assessment of

regulatory compliance

measures.

Shifting

consumer

preferences

and supplier

requirements

• Increased consumer

demand for highest

levels of low-carbon

compliance and

greater transparency of

operations.

• Develop supplier

selection criteria to

identify leaders in the

domain and screen out

suppliers who do not

meet the criteria.

FRASERS GROUP PLC ANNUAL REPORT 2022

Opportunities

We have identified opportunities in relation to the transition to a low-carbon economy. These have the potential to

increase our revenues, enhance our efficiency and optimise costs, and open up a broader range of financing sources.

The opportunities are set out in the table below:

Transition opportunity Benefit for Frasers Group Potential actions

Optimisation and efficiency of

processes and assets

• There is an opportunity for Frasers Group to reduce

costs by upgrading and improving assets and processes

across the value chain.

• Improve building and infrastructure efficiency.

• Switch to an all-electric vehicle fleet.

• Optimise logistics and the supply chain.

Financing

• There may be opportunities to raise debt capital to

finance climate projects.

• A robust approach to managing climate risks and

opportunities can help us to attract and retain new

shareholders.

• Identify potential opportunities to finance climate

projects using debt capital.

• Continue to enhance our climate-related reporting and

our sustainability reporting more generally.

Shifting consumer preferences

and supplier requirements

• There may be opportunities to capitalise on the

emergence of a new and growing market for

sustainable, clean and responsibly sourced products.

• Engage with suppliers and brands who are leaders in

sustainability.

Risk Management

The process through which we have identified and

assessed our climate-related risks during the year is

described in the Strategy section above. Our overall

risk-management framework is set out on page 50.

We have begun work to fully integrate the identification,

assessment and management of climate-related risks

into our Group-wide ERM. This work is based on the

following principles:

• Disaggregation. We will assess climate risks as

individual physical and transition risks, across our

regions and sites.

• Cross-cutting. We will integrate climate risks into

existing processes, so they can be considered

alongside our other operational and business risks,

including their interaction with those risks.

• Appetite. We will set an appropriate risk appetite for

each disaggregated risk.

• Ownership. We will set clear roles and

responsibilities, from the top down.

• Escalation. We will establish a process to escalate

risks to senior management, if necessary.

• Monitoring and evaluation. We will set up a

continuous process for monitoring, evaluating and

reporting across the business.

Our work to date includes climate risk being included

within our ESG principal risk and ensuring that

physical and transition risks are included in the

functional risk registers owned by the respective

business risk owners, such as finance, property,

logistics, commercial trading, supply chain and

people which can be found in on page 33.

Our plan is then to discuss potential actions with each

team, based on the principles described above. We are

implementing a Climate Risk Group, which will meet

regularly to discuss and drive forward our approach to

climate risk management. This will include all of the risk

owners mentioned above with executive sponsorship

and Audit Committee oversight, to ensure we remain

focused on the risks and opportunities for the Group

We will report on our progress with integrating climate

risks into the ERM in our FY23 Annual Report.

FRASERS GROUP PLC ANNUAL REPORT 2022

Metrics and Targets

Information on our greenhouse gas emissions can be found on page 46. Currently we do not have an approved

greenhouse gas emissions reduction target as part of our metrics and targets. However, we have submitted our

commitment to the SBTi, which has now been approved and we plan to have a target in place within the next two

years. The table below sets out the metrics we will use to monitor progress with managing our climate-related

opportunities and risks, as well as the targets we have set in relation to them.

Metric Category Climate-related Target Climate-related Metric Reasoning

Transition Risks All sustainability-related mandatory

reporting obligations met on time

annually

% sustainability-related regulatory

disclosures met within required

timeframe annually

We continue to be committed to

complying with ongoing regulatory

changes and support the aims of

initiatives such as TCFD to prepare

companies for climate change.

Physical Risks Counter-cost the top 40% of our

own brand contributing lines with

alternative manufacturers by end

of FY23

% of products by contribution with

an alternative manufacturer plan

in place

To migitate the risks of coastal

inundation and extreme heat we

plan to counter cost the top 40%

of our own brand contributing lines

with alternative manufacturers

to provide us with an alternative

partner, should our current partner

become unavailable.

Physical Risks Ensure top manufacturer by

contribution has risk mitigation in

place in line with 2050 projected

floodplain by end of FY23

Risk mitigation in place Y/N Following our analysis as part

of TCFD we plan to share the

projected floodplain information

with our manufacturers to help

them mitigate their potential

physical risks in their locations.

Climate-related Opportunities 90%+ Sports Direct GB stores with

a lease of 2 years or more and no

planned fixed break to be fitted

with LED lighting by end of 2023

% of Sports Direct GB stores with

LED lighting

Lighting was identified as

the greatest energy reduction

opportunity within our estate. We

chose Sports Direct stores as a

starting point as they are the largest

percentage of our estate.

Climate-related Opportunities Increase our container fill rate by

5% by end of FY23 based on a

2020 base year

Average units per delivery By maximising the fill rate of our

containers we reduce the number

of containers transported thereby

reducing greenhouse gas emissions

and costs related to those deliveries

FRASERS GROUP PLC ANNUAL REPORT 2022

Greenhouse Gas Emissions and

Energy Consumption

Reporting period

1 May 2021 to 30 April 2022

Baseline year

(1)

FY20

Consolidation approach

Financial control

Boundary summary

All entities and facilities globally, either

owned or under financial control, were

included. Emissions from air conditioning and

refrigeration units are excluded due to the

cost of data collection. These are expected to

be a negligible percentage of scope

1 emissions.

Consistency with

financial statements

Organisations are encouraged to align

information to financial years, to aid

comparability and consistency of information

with financial performance. SECR reporting

has been prepared on an annual basis to 30

April 2022, which is aligned with the financial

year of Frasers Group. The difference in

emissions of these date ranges is expected to

be negligible.

Emission factor

data source

DEFRA (BEIS) 2021 has been used for all

emissions sources.

Assessment methodology

The footprint is calculated in accordance

with the Greenhouse Gas (GHG) Protocol

and Environmental Reporting Guidelines:

Including streamlined energy and carbon

reporting guidance. Scope 2 reporting uses

the market-based calculation approach.

Estimations

18% of the energy data (kWh) and 16% of the

emissions data (FY20: 10.3% of the energy

data (kWh) and 7.6% of the emissions data)

used to prepare these results is based on

estimations or extrapolations, as calculated

by a third-party provider.

Intensity ratio

Emissions per £m of revenue

(1) Due to the impact of Covid-19, the base year chosen for all future SECR

comparisons is FY20 (1 May 2019 to 30 Apr 2020).

The Group has engaged a third-party provider to assess

emissions and energy consumption for the periods

reported in these results.

Scope 1 emissions comprise the emissions associated

with the combustion of fuels by the Group, as well as

additional emissions sources such as transport fuel.

Scope 2 emissions comprise the emissions associated

with electricity consumption by the Group, as well

as emissions from any generated electricity. Scope 3

emissions are other indirect emissions occurring as a

consequence of the activities from sources not owned

or controlled by the Group, including indirect transport

from travel in employee-owned cars and lease/hire

cars not owned by the Company, transmission and

distribution losses and well to tank losses. The non-UK

emission factors are those published by IEA and specific

to each country.

CO2 equivalent factors are used, which ensures we have

reported on all of the emission sources required under

the Companies Act 2006 Regulations. Consumption

considers all Group companies and no adjustments

have been made to comparatives for prior periods for

subsidiaries newly acquired in the period.

The Group’s CO2 emissions and supporting metrics are

detailed in the following table:

Year FY22 FY20

Scope 1 CO2 emissions (tonnes)

38,913 20,987

Scope 2 CO2 emissions

(market based) (tonnes)

40,077 68,162

Scope 3 CO2 emissions (tonnes)

13,081 7,550

Total Scope 1, 2 and 3

emissions (tonnes)

92,071 96,699

CO2 emissions (tonnes) / £m turnover

19.2 24.4

CO2 emissions vs turnover Index

(2020 = 100)

78.7 100

74.7% of Scope 1 and 2 emissions relate to the UK and

UK offshore areas.

The table below shows the Group’s energy consumption.

Scope 1 consumption relates to the consumption of

fuel and consumption from facilities operated by the

Group. Scope 2 consumption is based on the amounts of

electricity purchased through the period, as well as heat

and steam the Group generates for its own use.

Year FY22 FY20

Scope 1 consumption (kWh)

184,646,729 101,337,897

Scope 2 consumption (kWh)

305,169,539 276,618,984

Total Scope 1 and 2

consumptions (kWh)

489,816,268 377,956,881

The majority of the increase is due to the later part of

FY20 being impacted by the Covid-19 pandemic.

The table below shows energy consumption for the UK

and UK offshore areas only:

Year FY22 FY20

Scope 1 consumption (kWh)

156,504,302 80,667,717

Scope 2 consumption (kWh)

224,494,586 195,475,533

Total Scope 1 and 2

consumptions (kWh)

380,998,888 276,143,250

Frasers Group is committed to responsible energy

management and sustainability, which it practises

throughout the organisation where it is cost effective

to do so.

FRASERS GROUP PLC ANNUAL REPORT 2022

During the reporting year the Group has implemented

the following energy and carbon efficiencies across the

organisation, to ensure that energy consumption and

associated emissions are reduced:

• Energy consumption for each Retail site in the UK

is monitored, to make sure they are operating in an

efficient way and to ensure that levels are reducing.

• We continue to upgrade fluorescent lighting to

LED. for the Retail sites all opportunities to replace

lighting during a refit were taken and the resulting

consumption has reduced by c. 52% for those sites

that have had a full refit of lighting to the latest

LED technology.

• Face-to-face meetings with colleagues and

suppliers have reduced through the increased

availability of video conferencing thereby reducing

the amount of travel and further reducing Frasers

Group’s carbon footprint.

• We are implementing mini Building Management

Systems that are highly flexible based on common

industry standards and provide excellent

energy savings.

• We are using additional submetering within

sites and properties, to improve real-time energy

consumption and promote granular in-depth review

of facility energy data.

• Heating and ventilations systems are undergoing

trials that include retrofits to improve

energy efficiency.

• We are implementing voltage optimisation projects

that provide cost-effective solutions and deliver

optimised supply voltage.

A number of other energy efficiency measures are

under consideration for implementation during the next

reporting year.

FRASERS GROUP PLC ANNUAL REPORT 2022

SECTION 172 STATEMENT

The Board confirms that, during FY22 it has acted in

the way it considers, in good faith, would be most

likely to promote the success of the Company for the

benefit of its members as a whole, having regard to

the stakeholders and matters set out in s.172(1)(a)-(f) of

the Companies Act 2006. This statement sets out the

matters considered under each subsection of s.172(1)

(a)-(f) and provides cross references to where further

information can be found in the Annual report. The

areas the Board focused on during the year and the key

decisions made are set out on page 65 to 71 and our

report on stakeholder engagement during the year is on

page 66.

A. The likely consequences of any decision in the

long term

When making key strategic decisions, the Board

takes into consideration the strategy, purpose,

values and culture of the Group. The Board is

focused on the sustainability of the Group and

mindful of the impact the decisions may have on

this objective. for each matter, it also considers

the likely consequences of any decision in the

long term, identifying stakeholders who may be

affected and carefully considering their interests

and any potential impact part of the decision-

making process may have. During the year, the

Board has made decisions based on Board papers,

presentations from senior executives, information

documents, discussions with external advisors

and reports.

Principal Decisions/Steps:

Key appointments to positions of senior leadership

within the Group which included:

Preparation for the transition of Michael Murray who

was appointed as CEO on 1 May 2022 as part of the

Board’s long-term succession planning. The Board felt

Michael had proved himself to be a valuable asset to the

business, as an external consultant in relation to property

matters and the elevation of the physical store estate.

More recently, in his role of Head of Elevation, he has

built up a strong rapport with a number of key brands.

The approval of the appointment of Dave Al-Mudallal

and Sean Nevitt as Chief Operating Officer and Chief

Commercial Officer respectively, so that more focus can

be placed on areas of the business that will add value

and contribute to the ongoing Elevation strategy.

The decision to continue the share buyback programme

was also key during the financial year to demonstrate

that the Board continues to maintain confidence in the

performance of the Group.

The Board continued to be acquisitive throughout the

year. The acquisition of Studio Retail Limited was of

strategic importance to the Group due to its credit

offering which is an area that the Group is keen to

explore for its other fascias. SRL’s expertise in this regard

will provide valuable insight for the Group.

B. The interests of the Company’s employees

Details of the initiatives and engagement with our

colleagues is detailed in the Workers’ Representative

report, the Our People report and the

Directors’ report.

Principal Decisions/Steps:

The Non-Executive Workforce Director remains the

primary method that we use to ensure that colleagues

are listened to and responded to by somebody who

fully understands their situation. Cally Price remains the

Workers’ Representative on the Board and retains full

control of the colleague welfare portal.

The Group has also implemented a new e-learning and

development programme which includes a new learning

platform for colleagues which not only covers regulatory

learning, including data protection, but also personal

development and wellbeing courses that can be used

outside the business.

It has also been decided that a Leadership Academy

that provides professional accreditation and fosters

home grown talent from within the organisation should

be offered. This allows us to invest in our people

and retain our talent, which helps with the long-term

planning and sustainability of the Group.

FRASERS GROUP PLC ANNUAL REPORT 2022

C. The need to foster the Company’s business

relationships with suppliers, customers and others

The Group aims to develop and maintain

mutually beneficial business relationships with

all our suppliers and government agencies and

other stakeholders. Details of the Company’s

business relationships with suppliers, customers,

regulators and lenders are set out in the Corporate

Governance Report.

Principal Decisions/Steps:

• Our new loyalty programme has been launched.

• We have increased the available customer service

contact channels for our customers to provide

greater choice.

• We are focusing on increasing the number of

satisfaction surveys to assist with our strategy of

improving overall customer satisfaction.

• Reworked operating hours, to be aligned to

customer demands and activity.

D. The impact of the Company’s operations on the

community and the environment

The ESG report on page 33 details the initiatives

we have undertaken in sustainability and the

community.

Principal Decisions/Steps:

• We have developed and published our ESG policy.

• The Group has signed up to the textiles 2030

initiative to address sustainability issues within the

supply chain.

• We have developed extensive metrics and targets

around TCFD reporting (see page 40).

• The Group has responded to the SBTi’s urgent call

for corporate climate action, by committing to

align with 1.5°C and net-zero through the Business

Ambition for 1.5°C campaign.

As part of our sustainability plans, the Group has

launched a pilot – the ReLived Scheme, which is aimed

at recycling used clothing so it can be redistributed to

the people in the communities that need it the most. We

are also supporting the Bumblebee Conservation Trust

and have launched a campaign to save the bumblebees.

E. The desirability of the Company maintaining a

reputation for high standards of business conduct

At all times we endeavour to adhere to strict

Corporate Governance standards. The Board

continues to comply with the Corporate Governance

Code as well as industry best practice.

Principal Decisions/Steps:

Following recommendations from external consultants,

the Board approved the review and elevation of the

Group’s internal policies and procedures to bring them

into line with industry standards and best practice.

These new policies and procedures implement greater

levels of transparency within the business.

F. The need to act fairly as between members of

the Company

All shareholders of the Company hold ordinary

shares which attach the same rights and benefits.

We ensure that all shareholders have the

opportunity to express their concerns to the Board

throughout the year, with the existence of our

investor relations contact on the Group’s website,

and endeavour to respond when appropriate. The

AGM allows an opportunity for shareholders to ask

questions and to discuss issues in more depth.

Principal Decisions/Steps:

The Group recognises that the interests of our

institutional investors and other shareholders may not

always align with that of our majority shareholder. As

a result, certain resolutions at the AGM are required to

pass on a majority of independent shareholders vote.

The Group invites and analyses feedback from investors

in relation to their votes on resolutions put forward

at the AGM as well as internal policies. This feedback

is routinely presented to the Board for consideration

during its decision making and long-term planning.

FRASERS GROUP PLC ANNUAL REPORT 2022

PRINCIPAL RISKS AND

UNCERTAINTIES

Our Risk Management Framework

The Board has overall responsibility for the effectiveness

of the Group’s systems of risk management and internal

control. These systems are intended to manage, rather

than eliminate, the risk of failing to achieve business

objectives, and they provide reasonable but not absolute

assurance against the risk of material misstatement or

financial loss.

The Audit Committee supports the Board with

discharging its responsibilities, under a delegated

authority. The Chief Executive Officer has overall

accountability for managing risks in the business, and

his direct reports are accountable to him for effectively

managing those risks within their remits.

The Group’s risk management framework comprises

a top-down and bottom-up approach to risk

identification, evaluation and mitigation. Principal risks

are discussed and agreed by executive management

through the Compliance & Risk Group and by the Audit

Committee on behalf of the Board. The Board and/

or its sub-committees discuss each principal risk at

least annually and receive presentations and detailed

risk reporting from risk owners on a cyclical basis. Risk

owners re-evaluate principal risks in advance of each

Compliance & Risk Group discussion. Any changes are

reported to the Audit Committee, as part of our Group

Risks Profile reporting.

The Compliance & Risk Group provides connectivity

between executive management’s responsibilities

for risk management and internal controls and the

oversight roles of the Audit Committee and the Board. It

facilitates cross-functional discussion and collaboration

across principal risk areas and matters of internal

control. It also facilitates horizon scanning, emerging

risk discussions, and challenges the appropriateness of

internal controls and their effectiveness. The Compliance

& Risk Group’s activities are reported formally to the

Audit Committee. Our Steering Groups also report

formally to the Compliance & Risk Group, completing

our governance structure.

Our approach to risk management is illustrated below:

RISK MANAGEMENT FRAMEWORK

Board | Audit Committee | Sub-committees

Compliance & Risk Group

Steering Groups

THREE LINES MODEL

First line Second line Third line

Management Compliance & other

assurance functions

Internal Audit

RISK CONTROLS ASSURANCE

Operational teams and Functional level risks

Risk Identification

We have continued to identify and assess both our

principal and functional risks with management which

has enabled us to further develop our risk management

framework. Horizon scanning and emerging risks

form part of our structured compliance and risk group

discussions.

Risk Controls and Responses

We have continued to enhance clear definitions relating

to controls assessment, probability and impact, to

ensure our risks are clearly prioritised in line with our

defined risk appetite across each of our principal and

functional risks.

FRASERS GROUP PLC ANNUAL REPORT 2022

Governance and Monitoring

The responsibility for identifying, assessing and

managing risks resides with management at a

functional and executive level. The Compliance and

Risk Group provides reports and detailed evaluation of

key principal risks to the Audit Committee. The Audit

Committee on behalf of the Board, undertakes an

annual effectiveness assessment of the risks and internal

controls of the Group.

During the period, the Audit Committee, on behalf of the

Board, has: undertaken a full review of the Group risk

risk reporting and summary update reporting on the

Group’s principal risks profile, for further discussion

and challenge.

Audit and Assurance

We have a number of assurance functions that provide

second line monitoring and controls assessment e.g.

Health & Safety, Digital risk, Information Security and

Retail Support.

Our Group Internal Audit function provides independent

assurance that controls are working effectively and

reports its findings to management and the Audit

Committee as per an agreed annual audit plan.

Principal Risks and Uncertainties

These are defined as our most significant risks that

could affect our strategic ambitions, future performance,

viability and/or reputation. Principal risks are cascaded

to operational teams and central functions for discussion

and action on risk mitigations, as part of operational risk

management activity. Operational risk management

facilitates the elevation of risks to the Compliance & Risk

Group, for onward reporting to the Audit Committee.

Board Review

The work of the Audit Committee and the Internal

Audit & Risk team has been presented to the Board

for discussion. The Board is satisfied that the Group’s

systems of risk management and internal control

(including financial, operational and compliance

controls) have operated effectively during the financial

period, up to and including the date of this report,

and no significant failings of internal control were

identified during the period. The Group is committed to

continuously improving its risk management framework

and methodology, in line with regulatory standards and

the Group’s Elevation strategy.

Assessment of Principal Risks

We have carried out a robust assessment of our

principal and emerging risks in the period and our

principal risks profile has been updated to reflect where

our risks have changed.

We have continued to respond well to the on-going

challenges presented by the Covid-19 pandemic in light

of the uncertainty around lockdowns in Europe and new

variants during the period. The effects of the pandemic

on economies and society at large were more prominent

than expected and we remain cautious with a number

of well publicised macroeconomic headwinds on the

horizon in the form of but not limited to cost increases,

supply chain issues and potential squeezes on consumer

spending power.

Environmental, social and governance (ESG) issues

feature more prominently in our disclosures. Climate

and sustainability risks have remained an integral part

of our commitment to ESG and our business operations,

but have previously been incorporated into our broader

disclosures on corporate and social responsibility.

The following risks and mitigations are an extract from

our principal risks profile and are not presented in any

order of priority. Principal risks are those which we

consider pose a threat to our business model, future

performance, prospects and/or reputation.

FRASERS GROUP PLC ANNUAL REPORT 2022

Reference To Strategy

Building excellent relationships

with the World’s best brands

Elevation in our digital offering

Elevation of our physical stores

Enablers : People, Training,

Brand, Communication, Systems,

Automation, Data

Risk Trends

Increasing

Unchanged

Decreasing

FRASERS GROUP PLC ANNUAL REPORT 2022

PRINCIPAL RISKS

Strategy

The Group continues to deliver its Elevation strategy, which focuses on the brands we sell, our digital offering and our

physical stores. Our vision is to become the elevated multi-channel platform for sports, premium and luxury brands.

We continue to deliver well against all aspects of our strategy, and the on-going support of our key partners and

investors for our strategy has enabled this risk to reduce over the past 12 months.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

We fail to deliver our strategy efficiently, effectively and on a

timely basis, or we adopt the wrong strategy, which impacts our

long-term growth, performance and ambition.

• The Board and senior management set and agree the Group

strategy and undertake both regular and detailed reviews.

• Our Group is diverse in terms of geography and product

and executive management is able to respond to strategic

opportunities and challenges with agility, to maximise

achievement of our strategic ambitions.

• We continue to evaluate strategic brand acquisitions, to

provide product and choice in line with our brand strategy

and add attractive locations to the store estate.

• Effective management of our property portfolio supports our

elevated direction.

• We monitor our performance, markets and competition on an

ongoing basis.

• Our strong financial controls, reporting and analysis help to

optimise resource allocations, maximise profits and cash flow

and support efficient and effective strategic delivery.

• We perform ongoing research for insights into consumer trends.

• Ongoing internal and external communication of our strategic

direction supports understanding, engagement and

effective delivery.

FRASERS GROUP PLC ANNUAL REPORT 2022

Third-Party Brand Relationships, Key Suppliers and Supply Chain Management

Key brands, brand suppliers and major manufacturers are central to our business and Elevation strategy. Our strategic

acquisitions and business model aim to bring attractive brands into the Group, to support customer demand and

choice.

Our supply chain is international and is subject to stringent management of supply chain logistics and working capital,

we continue to navigate through the well-publicised global supply chain issues to ensure the flow of product is in line

with our strategic ambition.

We have continued to strengthen our brand and supplier relationships during the pandemic, demonstrating the

strength of our business model and strategic performance. This also supports new product availability, in line with our

elevation ambitions.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

We fail to manage and leverage our supplier and brand partner

relationships successfully, to secure the right products for our

business at the right price and quality, and to meet or exceed

our customers’ expectations. Failure to mitigate these risks might

impact our elevation targets, performance and long-term growth.

• The Group has a policy of forging close long-term commercial

relationships, which are underpinned by our commitment to

product, elevation and customer excellence.

• The Elevation strategy targets forging stronger relationships

with key brand partners, and this continues to be an

ongoing priority.

• Dedicated relationship partners, procurement and commercial

teams support truly integrated supplier engagement.

• The Group utilises two leading supply chain companies to

procure much of its own-brand products. A Group-owned

supply chain entity further diversifies risk.

• Our stock levels supported our ability to trade through

the Covid-19 pandemic and supply chain delays. We have

continued to secure ongoing supplies, due to the depth and

breadth of our commercial relationships.

• Suppliers sign-up to the Group’s Supplier Manual, which

enables us to monitor and benchmark supplier performance.

• Strong service level agreements are in place, which help to

support an effective supply chain network.

• Our own-brand investment targets consumer trends and

complements third-party brands, supporting consumer choice.

• Influencer partnerships and brand collaborations provide

opportunities for own-brand growth.

• Electronic Data Interface (EDI) capability improves our process

efficiency through the commercial cycle and enhances

supplier engagement through a dedicated supplier portal.

FRASERS GROUP PLC ANNUAL REPORT 2022

Global Macro-economic Conditions, Events (Pandemic) or Political Factors

The current geo-political events and the on-going global pandemic are core aspects of this risk in the period under

review. We also monitor global and national political change on an ongoing basis, for impacts on our strategy and

supplier networks. These are external events and we respond well to those factors we can control. The strength of our

business and our performance enables us to generally absorb the broader indirect economic impacts associated with

these risks (including the challenging economic conditions at present, with inflationary pressures and increased energy

and cost of living) although we remain cautious at all times.

The current macro-economic pressures and geo-political events occurring in Eastern Europe have clearly increased

this risk and we continue to monitor these events and the potential impacts on the Group.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to anticipate, evaluate or appropriately respond to

external events, or broader global/macroeconomic conditions,

events (pandemic) or political factors, may risk the achievement

of our performance targets, impact our strategic direction or

longer-term viability, or result in lost opportunities for growth.

Pandemic:

• We have continued to implement effective response

procedures, with Board oversight and prioritisation.

• Our mandated safe working and operating standards

prioritise colleague and customer wellbeing.

• We deployed new safety requirements quickly, with external

validation and ongoing evaluation, review and monitoring.

• Investments in our online capability and customer service

delivery support our accelerated growth in e-commerce.

• Effective supplier and supply chain management optimises

working capital and leverages and strengthens our

commercial relationships.

• Effective management of cash flows and committed facilities

supports our liquidity, long-term viability and trading

partner support.

• We conduct ongoing scenario analysis, with timely reporting

to management.

• We leverage opportunities for investment, through strong

management oversight.

Monitoring of economic and political change:

• We ensure ongoing financial and commercial evaluation of

economic and political change, with senior management

oversight and Board reporting.

• The executive-led Compliance & Risk Group holds emerging

risks discussions, with oversight reporting to the

Audit Committee.

• Immediate online closure of sanctioned countries for deliveries

or trade through our web platforms was actioned during the

current conflict.

FRASERS GROUP PLC ANNUAL REPORT 2022

Treasury, Liquidity and Credit Risks

Short, medium and long-term funding arrangements support our business operations and our ability to meet our

financial obligations and deliver our strategic ambitions.

Funding availability remains a principal risk but the overall risk level trended downwards towards the end of the period,

based on our trading performance and strategic delivery through the height of the pandemic and the successful

refinancing of our Group facility to 2024, however with the acquisition of Studio Retail Group, we remain cautious of

our exposure to credit risk in respect to ‘Credit customer receivables’ and therefore the overall risk remains unchanged.

Interest rate risks arise on net borrowings. Foreign exchange risk arises from international trading, future sales and

purchases in foreign currency, loans to non-UK subsidiaries and unhedged options to buy or sell foreign currency.

Credit risk arises primarily through our Wholesale and Licensing customers and there is some level of counter-party

risk exposure, although we do not consider this to be material.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to appropriately manage our funding and liquidity

positions and secure access to funding markets might impact our

plans for growth, the ability to manage our trading requirements,

meet longer-term liabilities and the ongoing viability of

our business.

• Our Board reporting on debt, covenants, funding and cash

flow positions includes stress testing and extensive business

risk scenario analysis, including Brexit, Covid-19, mandated

store closures and related costs.

• The Group Treasury function manages liquidity, interest rate

and foreign exchange risks.

• The Group treasury policy, with Board oversight, outlines

delegated authorities for operation, monitoring and reporting.

• We have refinanced our Group facility until 2024 with an

option to increase the term by an additional two years.

• Ongoing monitoring and reporting of going concern and

viability are part of our standard suite of internal and

external reporting.

• Our hedging strategy is reviewed and approved annually

as part of our treasury governance, with hedging activity

reported to Board.

• Investments of surplus cash, borrowings and derivative

investments are made under pre-approved investment criteria.

• We use forward foreign currency contracts to hedge against

highly probable foreign currency trading transactions.

• We conduct regular monitoring of customer and

counter-party credit risks.

See note 3 to the Financial Statements for further detail on financial risk management.

FRASERS GROUP PLC ANNUAL REPORT 2022

Customer

Customer engagement and retention is vital to our Group, whether through our physical stores or online. Continuing

to harness customer value and loyalty consistently across the Group is complex as it is underpinned by our product

offerings, price and service.

We have enhanced our e-commerce offering and significantly improved our customer experience through our

Elevation strategy, as well as our customer service and the underlying platform for our digital business.

We continue to strengthen our elevation through our new concept stores and flagship multi-fascia offerings.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to anticipate and respond to customer needs or changes

in consumer trends and spending, or to drive and deliver

customer service excellence, may impact our growth, value,

reputation and strategic ambition.

• We conduct ongoing monitoring of customer insights and

competitor and market trends.

• We review and update our customer policies periodically which

enables us to respond to and drive our customer-led strategy.

• Continued investment in our customer service offering,

systems and communication enables us to understand and

improve our customer experience, working across all channels

including social media.

• We continue to develop and invest in our online offering, in

line with customer demand.

• Ongoing enhancement of our ESG agendas supports our

strategy, in line with our customer focus.

Legal and Regulatory Compliance

The legal and regulatory landscape in which we operate is constantly changing. Our commitment to delivering

robustly on our obligations is central to our culture and values.

We have increased our assessment of this risk in the period, based on factors which continue to impact the legal and

regulatory landscape in which we operate. We are conservative in our assessments and are confident in our ability

to manage these risks effectively. The trend we are reporting recognises anticipated changes through our horizon

scanning and emerging risks evaluations, until we have implemented our response plans.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

An action or incident may occur which results in a legal or

regulatory breach and which impacts our business financially,

commercially or reputationally and/or may result in litigation.

• Our experienced and qualified in-house Legal team provides

core services and advice as well as oversight of new and

emerging legislative and regulatory requirements.

• External advisers provide additional services and training in

specialist areas, as required by the business and legal team.

• Key legislative and regulatory compliance risk areas are

prioritised (including but not limited to), FCA regulation, GDPR/

data protection, health and safety, IP rights, Listing Rules and

Trading Standards as an ongoing priority.

• Our Code of Conduct supports our ethics, behaviours and

culture, and our regulatory policies include, for example,

Anti-Bribery & Corruption, Corporate Gifts & Hospitality and

Conflicts of Interest.

• We review the approach and content of mandatory induction,

policies and ongoing training across relevant areas, for

all colleagues.

• The Legal team is a key contributor and adviser to the

Compliance & Risk Group.

FRASERS GROUP PLC ANNUAL REPORT 2022

Technology Capability and Infrastructure Renewal

We operate in a competitive and challenging customer-focused market. Our systems need to be built with customer

experience at the forefront, supporting an end-to-end supply chain logistics service. Technology is constantly evolving

and managing change and transformation in this environment is a key focus.

We have invested heavily in our automation, enhancement of IT platforms and delivery capabilities, which support a

modernised online and in-store customer experience, built on resilient infrastructure.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to maximise the use of our existing technology or to

renew our infrastructure in a timely and effective way may affect

our ability to keep up with the pace of change and deliver our

strategic ambition.

• We continue to develop our Group technology strategy, which

is aligned to the business strategy.

• Our forward programme of infrastructure renewal enables us

to operate our business efficiently and support our ability

to compete.

• Our streamlining and decommissioning programme supports

acquisitions and integration activity.

• Investments in our online trading capabilities, warehouse

management systems and in-store technology enhance the

end-to-end customer experience.

• Our experienced Technology team, supported by ongoing

skills training, helps us to keep abreast of emerging

technologies and customer-leading insights.

• We develop an ongoing cycle of internal training programmes

to support effective use of existing and new technologies

across our businesses, as they are introduced.

• Strengthening our information security capability has

enhanced our transformation programme, our strategic

technology delivery and the robustness of our

second-line oversight.

Cyber Risks, Data Loss and Data Privacy

Attempts to attack or gain unauthorised access to systems and data are becoming increasingly sophisticated. Our

systems are critical to our operations and trading. We have legal and commercial obligations to protect the security

and privacy of the data we hold and process.

We combine the continued investment in our digital offering, automation and technological change with the

strengthening of our people and in-house capabilities, to deliver on our risk mitigations.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

A cyber-attack may result in data loss and/or denial of service,

impacting our business financially through fines and penalties or

lost trade, as well as our reputation and our ability to operate.

Failure to adequately protect our processes and the data we hold

may result in legal or regulatory breach, loss of trust and financial

loss.

• We have strategies and policies in place to support our IT

security, with continued development and review.

• We collaborate closely with our industry leading service

partners, who provide core services beyond our in-house

capabilities. Capability delivery, security and savings are

core drivers.

• Protection tools, including encryption, and detection tools are

in place to support effective monitoring and reporting, and are

reviewed regularly.

• We have enhanced our information security capabilities and

strengthened our second-line monitoring.

• We conduct an annual external review of our cyber

infrastructure and penetration testing across the Group.

• Strengthening our data protection mandate, enhancing our

policies and procedures and ongoing internal training help

to mitigate data protection and privacy risks and support

delivery of our change and transformation programme.

• We have an ongoing programme of security and privacy

monitoring across our Group and extended enterprise.

• Our in-house Legal team supports second-line monitoring and

reporting of legislative compliance.

• We have continued to invest in data protection training and

communications (and local legislative equivalents in our

overseas operations).

• We routinely action and retain Data Protection

Impact Assessments.

FRASERS GROUP PLC ANNUAL REPORT 2022

Business Continuity Management and Incident Response

Our Head Office and Distribution Centre at Shirebrook and our e-commerce activity are critical to our business

operations. There is an ongoing and increasing reliance on the availability of technology across our Group. We need

the ability to respond to incidents effectively and on a timely basis, to ensure continuity of operations and trade.

We have continued to invest in our warehouse automation and develop appropriate documented contingency

strategies allowing this risk to move downwards over the period.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to respond effectively or on a timely basis to operational

or IT incidents or events might impact the Group financially

through lost revenue or have a reputational impact, based on our

capability and communications.

• Our business continuity plans are fully documented and are

scheduled for continual review, revision and testing as required.

• Our governance structure supports agile incident response,

with clear roles, responsibilities and reporting lines.

• Annual external review and challenge of our processes

supports our commitment to continuous improvement.

• Ongoing training supports good practice and knowledge

sharing for continuity.

• Internal and external communications, marketing and PR

capabilities are integral to our incident response plans.

• Recovery prioritisation of IT systems and processes forms part

of our business impact analysis review.

• We have recovery time targets for both critical and normal

service functions.

• Critical recovery capabilities align to our appetite and controls,

supported by appropriate insurance cover.

Group Entities and Extended Enterprise

Our Group is complex and extensive and includes oversight of our third-party and extended enterprise partners and

suppliers. We are committed to ensuring we have the right levels of transparency, consistency and monitoring across

our Group, to enable effective oversight in line with our values and culture.

We have an appetite for acquisitions as part of our strategic growth agenda. Our integration strategy continues to be

developed to support ongoing efficient and effective acquisition engagement and management.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to effectively monitor activities across our Group entities,

partners and suppliers, who form part of our extended enterprise,

may result in financial, reputational or legal compliance issues.

• Transparency across our Group and extended enterprise

and its changes is an ongoing priority. It is subject to regular

review and discussion and forms part of our risk management

framework and reporting.

• Oversight roles and responsibilities across our Group structure

support risk-based functional monitoring and assurance.

• We maintain strength in our supply chain management and

supplier and partner relationships.

• Risk and controls reporting across the Group is subject to

continuous improvement, including self-assessment processes

for confirmation of compliance with key policies, controls and

other Group requirements.

• Governance and monitoring are in place for new investments,

acquisitions and opportunities.

• The Group Internal Audit team is developing third-line

monitoring to support the broader internal controls framework

across the Group.

FRASERS GROUP PLC ANNUAL REPORT 2022

People, Talent Management and Succession

Our business benefits from strength and depth of knowledge, talent and experience, which has long been pivotal to its

success. Retaining and protecting this talent, providing for succession and an ongoing programme of attracting and

developing new talent is core to our people plans and objectives.

We have made significant progress in the period in this area and when new initiatives have time to embed, we expect

to see this risk trend decrease. However, the current pressures on the national labour market throughout the retail

sector has increased our risk over the period.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to attract, retain or develop talent across our business and

implement effective succession planning might impact our ability

to achieve business and strategic objectives and the efficiency of

our growth transformation.

• Continued development of strong trainee management and

apprenticeships programmes supports our future

talent pipeline.

• We recruit externally to fill capability gaps necessary for our

growth and transformation.

• We prioritise internal development and promotion wherever

possible and actively encourage cross-functional experience.

• A new ‘fearless focus’ appraisal system has been introduced,

with clear expectations for performance, opportunities for

development and broader succession planning.

• A six pillar People Framework supporting performance and

talent recognition is now in place across the Group.

• An internal recruitment mandate operates, with improvements

in onboarding and applicant tracking.

• We have created core principles and a colleague value

proposition that share the Group’s values and ambitions for

our people, with an elevated and re-energised website to

attract talent.

• A new recognition and bonus structure has been launched,

recognising and rewarding people who continually adopt our

core principles.

• The Workers’ Representative is a Board Director, who supports

communication channels and gives our people a voice at the

highest level in our business.

• We have a strong strategy for diversity and inclusion and

people support.

• We have made significant investment into learning and

development, supporting internal progression and overall

organisational capability.

FRASERS GROUP PLC ANNUAL REPORT 2022

Environmental, Social & Governance (ESG)

Tackling climate change is a global imperative and the resulting increase in regulation is a key focus area for

the Group.

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.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

Failure to maximise our position and value relating to ESG factors

might impact our ability to achieve our growth, value, reputation

and strategic ambitions.

• We have Board-level engagement and an Executive sponsor

of our ESG agenda.

• Sustainability continues to be embedded throughout the

business and is a continued area of focus for the Group.

• Dedicated operational leadership continues to drive project

and programme initiatives and engagement through our

supply chain.

• Appointing our Group Carbon Reduction Manager shows our

commitment to tackling climate change.

• We have evaluated our risks and opportunities around climate

change and our TCFD disclosures provide further details

on this.

• We have an environmental policy in place, which has been

reviewed and approved by the Board.

• We have energy efficiency targets, monitoring and

measurement, with external specialist support and league

tables with reward mechanisms to drive this forward.

• We continue to launch ranges and products that drive

responsible and sustainable purchasing decisions.

• Our community initiatives support the provision of vouchers to

schools and organisations to allow purchases of

discounted sportswear.

• Review and ongoing development of the Group Code of

Conduct supports our values and colleague engagement and

includes a standardised framework for supplier onboarding.

• We are constantly working with our partner brands and

suppliers to encourage more sustainable practices.

FRASERS GROUP PLC ANNUAL REPORT 2022

Property

The retail landscape continues to see significant changes with a high volume of retail properties vacant due to the

high level of retail insolvencies and retailers moving away from bricks and mortar to e-commerce due to the shift in

consumer behaviour, which has further increased due to the Covid-19 pandemic.

As a result of the above, both the value and value in use of retail properties has declined.

Risk Trend and

Links To Strategy

Risk Controls and Mitigations

There is a financial risk to the Group if our commitment to a

lease or the value of our freehold properties decline, where high

vacancy rates make the area less attractive for our consumers

and drive less footfall to our stores.

• For new store leases we actively engage and work with our

landlords to support rents that are flexible and linked to

store turnover.

• We aim to align rent free packages and capital contributions

from landlords to reflect the elevated store fit outs.

• As retail units become more affordable, we look to move

into more prime locations with more footfall and consumer

resilience.

• We are actively reviewing our lease portfolio and looking to

renegotiate with landlords in relation to underperforming stores.

• The freehold estate is actively managed by the property team

and we will look to dispose of sites which are not aligned with

the Group’s strategy or where there is a commercial benefit to

the wider Group.

The Strategic Report has been approved by the Board and signed on its behalf by:

Chris Wootton

Chief Financial Officer

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

VIABILITY STATEMENT

The 2018 UK Corporate Governance Code requires the

Board to express its view of the long-term viability of

the Group and assess the Company’s prospects, capital

management and principal risks.

Accordingly, the Board regularly carries out thorough

and robust assessments of the risks, including stress

testing the Group’s resilience to threats to its business

model, strategy, future performance and liquidity

and the risks identified in the Principal Risks and

Uncertainties section of this Report, together with the

steps the Group has taken to mitigate them. In addition,

the Board regularly reviews the performance and

financing position of the Group and its projected funding

position and requirements.

The Group continues to face the challenges that the

pandemic, Brexit, supply chain issues and changing

consumer behaviour are having on the retail industry.

The Board chose to review these over a three-year

period to 27 April 2025. This period is covered by the

Group’s combined term loan and revolving credit

facility (on the assumption the extension is granted).

Management is satisfied that a three year period is

appropriate to review performance, as it best reflects the

short-term budgeting and planning process of the Group,

the longer-term forecasting and the expected timescales

for strategy implementation. The process adopted to

prepare the model for assessing the viability of the

Group involved input from a number of departments

across the business to model a conservative scenario.

The Board has considered all the risks included within

our Principal Risks section as they could all have an

impact on performance. However, with regards to

viability, we have focused on those which are the

greatest risk:

Global Macro-economic Conditions,

Events (Pandemic) or Political factors

We have:

• reviewed the continuing impact of the pandemic

on the Group’s sales and margin in relation to both

store and online revenue; and

• reviewed the continuing impact on costs due

to Brexit.

Third-party Brand Relationships, Key

Suppliers and Supply Chain Management

We have:

• tested the business model’s resilience to changes in

the retail market and responses to variability in sales

and margins;

• taken into account further consumer shift from

bricks and mortar to online;

• forecast the impact of key suppliers going direct

to consumer;

• reviewed the arrangements with key suppliers; and

• forecast and modelled increased costs associated

with supply chain issues.

Treasury, Liquidity and Credit Risks

We have:

• reviewed the Group facility and its suitability for the

Group’s cash flow cycle and liquidity requirements;

and

• reviewed the Group’s hedging strategy.

Viability has been assessed by performing sensitivity

analysis and stress testing of the Group’s FY23 budget

and forecast for the viability period prepared by

management. This comprised a recent review by the

Board of a number of scenarios in which the Group’s

income statement, balance sheet and cash flow

forecasts were stress tested to determine how much

the Group’s trade would need to be affected in order

to breach the Group’s covenants (being interest cover

and net debt to EBITDA ratios). These scenarios, the

occurrence of which are deemed to be highly

remote, include:

Scenario 1:

The Frasers Group operations as a whole are impacted

by a material and unexpected reduction in demand (e.g.

future pandemic), we materially fail to manage brand

partner relationships resulting in trade being impacted

for a period of time (e.g. loss of key suppliers) or there

is a significant impact due to the economic downturn

globally due to reduced customer confidence resulting in

lower spending.

FRASERS GROUP PLC ANNUAL REPORT 2022

Assumptions:

• a further decrease in sales of 10%, margin remaining

consistent with original budget and direct costs

falling in line with sales.

Scenario 2:

Our supply chain continues to be affected across

the Group by the impact of Covid-19 and Brexit,

with logistics costs significantly increased for both

ourselves and our suppliers who pass on the increased

costs impacting our margin or there is a significant

impact due to the economic downturn globally due to

customers being more price sensitive.

Assumptions:

• the gross margin percentage reducing by a further

2% across the Group, with other assumptions

remaining consistent with the original budget.

Scenario 3:

• this is a combination of scenarios 1 and 2 above and

is seen as the worst-case and highly unlikely.

This scenario testing indicated that the business could

withstand a sustained decline in sales and gross margin

and, through the use of mitigating actions, remain within

its financing facilities and covenants.

On 30 November 2021 the Group refinanced its existing

borrowings and entered into a combined term loan and

revolving credit facility of £930.0m for a period of three

years, with the possibility to extend this by a further two

years. This facility increased to £940.0m as at 24 April

2022 and to £980.0m subsequent to the period end.

The Group has consistently created strong operating

cash flows from underlying trading and has an

appropriate hedging strategy to meet currency risks.

There have been no post balance sheet changes

to liquidity.

The impact on the projected cash flow as a result of

the conservative model has been reviewed, if required

management has a number of mitigating actions which

could be taken such as putting on hold discretionary

spend, liquidating certain assets on the balance sheet, or

reductions in labour and marketing costs.

Based on its assessment, the Board has a reasonable

expectation that the Group will be able to continue

operating and be able to meet its liabilities as they fall

due for a period of approximately three years.

The Viability Statement was approved by the Board on

20 September 2022, and signed on its behalf by:

Chris Wootton

Chief Financial Officer

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

GOVERNANCE

CORPORATE GOVERNANCE

REPORT

Chair’s Introduction

As Chair, my primary role is to ensure that the Board

effectively sets and implements the Company’s direction

and strategy. I am responsible for leading the Board

to make decisions that will benefit the Group and

ultimately its stakeholders. My role is to ensure that we

adhere to high standards of corporate governance that

will facilitate the continued sustainability of the Group.

Our Non-Executive Directors have a great depth

of experience, remain independent throughout all

discussions and are rigorous in challenging the

Executives in the best interests of the Group. Our

Executive Directors understand the Group’s values and

behaviours. They work tirelessly to retain and grow

shareholder value, engage our workforce and promote

the Group’s strategy.

The Board and the Committees continue to work

effectively and collaboratively to ensure the decisions

being made drive the Group forward. I would like to

thank Board members for their commitment

and diligence.

We have continued our efforts to work on improving our

environmental impact and sustainability as well as the

difference we make in the communities we serve. Further

details are included in our ESG report at page 33.

The Board and Audit Committee have worked with

the sustainability team as well as external advisors in

relation to TCFD reporting. The Board and Committee’s

have also worked with the Group to set stretching

but achievable targets for the Group during the FY23

financial year. The TCFD report is at page 40.

We have also continued to strengthen our governance

as part of our ongoing Elevation strategy. Further

information regarding our compliance with the Code

can be found in our Corporate Governance Statement

at page 65.

David Daly

Non-Executive Chair of the Board

20 September 2022

CORPORATE GOVERNANCE

STATEMENT

This Corporate Governance Report and Statement sets

out how the Company has applied the principles in the

2018 UK Corporate Governance Code during its financial

period ended 24 April 2022. A copy of the Code is

available at www.frc.org.uk.

Disclosures in relation to DTR 7.2.6 (share capital) and

DTR 7.2.8 (diversity) are set out in the Directors’ Report

on page 95 and in the Nomination Committee Report

on page 75.

The Board considers that it complied with the majority of

the principles and provisions of the 2018 UK Corporate

Governance Code for the period ended 24 April 2022.

One area in which the Board was not fully compliant

was Code Provision 36 which requires that remuneration

schemes should promote long-term shareholdings

by Executive Directors that support alignment with

long-term shareholder interests and that share awards

granted for this purpose should be released for sale on

a phased basis and be subject to a total vesting and

holding period of five years or more. The Executive

Share Scheme approved by 86.6% of shareholders’

voting at the 2021 AGM has a total five-year vesting

period as suggested by the Code but could permit 50%

of share awards to vest after four years if our stretching

share price targets (a minimum £12 or £15 as relevant

maintained for 30 dealing days) are attained within 4

years of the commencement of the plan.

Board Leadership and Company Purpose

The Board

Board changes during the year were minimal, with one

director resignation due to a conflict of interest. Despite

this, the Board remains stable and well resourced. We

are reviewing the Board’s size, composition and skillset

on a regular basis to ensure that it continues to be fit

for purpose and address areas where we can make the

most effective changes.

Business Model

Information on the Group’s business model and strategy

can be found in the Strategic Report on pages 12 to 16.

FRASERS GROUP PLC ANNUAL REPORT 2022

Culture

During the year the Board, and the Remuneration

Committee in particular, met regularly with the Group

Head of People to assess and monitor the culture of the

Group, especially as seen from outside the Group. This

led to a social media strategy to raise the reputation and

profile of the Group to bring in potential future talent.

The Group has also developed a newsletter to provide

more regular and consistent messaging to colleagues.

Further information on the Group’s culture can be found

on page 33.

Stakeholder Engagement

Like most companies, the Group has to balance

the needs of multiple stakeholders. Stakeholder

engagement is integral to the growth and sustainability

of the Group. We aim to ensure that we capture the

views of as many stakeholders as possible. Whilst we

try to accept commendation where appropriate and

address criticisms when necessary, we are mindful that

this may not always be possible. We recognise that the

most important objective in our approach to stakeholder

engagement is to balance stakeholder views against

other competing factors and accept that it may not

always be possible to achieve a satisfactory outcome for

all stakeholders. During the year, the Board has made

decisions based on the Board papers, presentations

from senior executives and discussions with and reports

from external consultants. The principal decisions in

relation each of stakeholders is contained in the s.172

statement on page 48.

Employees

Please see the Director’s report for details of employee

engagement.

Shareholders

The AGM provides shareholders with an avenue to have

direct access to the Board and senior leadership. The

Group resumed physical AGMs in FY21 but also offered

shareholders the ability to submit questions prior to

the meeting.

Comments from our shareholders are passed to the

Board and relevant committees for consideration and

analysis. The Executive Directors are also available

for questions at all our result presentations and

shareholders’ opinions are closely monitored through

analyst and broker correspondence. Our larger

shareholders also have regular engagement with senior

executives and a number have visited our Shirebrook site

during the financial year. Shareholders also have access

to other key representatives of the Group, by using the

investor relations contact on the Group’s website.

Customers

The Group continues in its effort to provide an elevated

customer experience. Our efforts aim to act upon and

improve customer feedback. Customers now have the

ability to reach out to us through numerous channels

and we have started the roll out of self-service options

in selected fascias. There have also been improvements

to the online help centre to encourage first-time

resolutions for the customers who make contact and we

have adopted a flexible-working approach to address

customer demand during peak times.

The Group has invested in an Operational Excellence

programme which is focused on supporting, developing

and empowering the Customer Service teams to

provide them with the right tools to meet the highest

standards of customer service and satisfaction. We

have also invested in increasing our Customer Service

capacity by establishing an inhouse contact centre in

one of the overseas territories in which we operate. The

Group has also made significant investments in our

digital capabilities and approach to customer service

management which we are confident will yield improved

results for FY23.

The acquisition of Studio Retail Group, which had a very

strong consumer credit team, has also ensured that we

can accelerate our proposition of offering our customers

more flexible payment options, by utilising this expertise

for the rest of the Group.

Suppliers

We aim to engage with suppliers who have compatible

values to those of the Group and who provide value for

money and high-quality goods and services. The Group

prides itself on fostering long-term relationships with

our key brand partners to ensure ongoing continuity

of supplies to our customers. This includes, where

appropriate, making strategic investments in brand

partners such as Mulberry and Hugo Boss.

Our own-brand products continue to be produced and

supplied by our two gateway suppliers with whom we

have a longstanding relationship.

We are currently undertaking a review of our

procurement process and policies, to assess our suppliers

to ensure that we can meet our ESG commitments and

achieve our TCFD targets. Further information can be

found in our ESG report.

FRASERS GROUP PLC ANNUAL REPORT 2022

Regulators

The Group makes every endeavour to comply with its

legislative and regulatory obligations. We regularly

liaise with HMRC, the FRC and the FCA in an open and

transparent manner. The Finance team and the Board

have established regular communications with tax

authorities internationally. Our internal tax team has a

dedicated contact at HMRC and we have dedicated

contacts at other Government bodies, such as

Trading Standards.

Lenders

Alongside attending all Board meetings, the CFO is

always available to inform the Board of any updates in

relation to financial lenders. With the assistance of the

Finance team, the CFO ensures that the Group complies

with the terms and conditions in its credit facility

agreements. The CFO regularly liaises with the Chair of

the Remuneration Committee and the Chair of the Audit

Committee, to discuss the Group’s financial performance.

Updates on the Group’s financial performance are

provided at every Board meeting.

During the year, the Group entered into a new term loan

and revolving credit facility that is valid for three years

at a value of £930 million with the option to increase

the value up to £1.2 billion. As at the date of the release

of this Annual report the Group facility was at a value of

£980m. This replaces the previous £913m facility.

Community

Details of our engagement with the community can be

found in our ESG report on page 33.

Workforce Concerns

Cally Price remains the voice of workers on the Board

and provides a direct link with the workforce and Board.

She regularly provides the Board with an update on the

workforce and brings any pertinent issues to

their attention.

The workforce is able to raise awareness of any issue

they face by speaking with their line managers or HR.

They can also send an e-mail to the whistleblowing

inbox if they have concerns around wrongdoing or

they can report issues anonymously through the ‘Your

Company, Your Voice’ hotline, which is monitored by

Cally Price. There is also an anonymous whistleblowing

e-mail address to voice concerns, which the Company

Secretary has access to and is responsible for monitoring.

Whistleblowing is an agenda item at each Board

meeting so that any concerns can be raised to the

Board. In addition, the Chair has regular meetings with

the Company Secretary on an informal basis, where any

whistleblowing reports can be discussed.

Colleagues also have access to confidential wellbeing

advice and support through the Retail Trust.

Director Concerns

During the year, no concerns were raised by the Board,

or any current or former directors, regarding the

operation of the Board or the management of

the Group.

Conflicts of Interest

Details of procedures regarding Directors’ conflicts of

interest, including the Relationship Agreement with Mike

Ashley as the controlling shareholder, can be found in

the Directors’ Report.

Anouska Kapour was appointed to the Board in

September 2021, but subsequently took the decision

to resign from the Board in December 2021 due to a

conflict of interest. No further conflicts from other Board

members became apparent throughout the year.

The Board considered whether Nicola Frampton’s

appointment as Chief Operations Officer of Domino’s

Pizza Group created a conflict of interest. It was

unanimously agreed that as Domino’s operates in a

separate sector to the Group, that this was not a conflict.

Nicola continues to be able to dedicate enough time to

her role as a Non-Executive Director, as shown by her

Board and Committee attendance throughout the year.

Corporate Governance Framework

The Group has continued with the elevation of its

corporate governance framework. The Group has

re-drafted and published numerous policies including

our Whistleblowing and Anti-Bribery & Corruption

policies to strengthen our current internal controls. This

work will continue into the next financial year. The

Internal Audit team has drafted an audit timetable

for the FY23 financial year, reviewing various different

departments to ensure internal controls are appropriate.

Division of Responsibilities

The Chair

The Chair leads the Board, ensuring constructive

communications between Board members and that

all Directors are able to play a full part in the Board’s

activities. The Chair sets Board agendas and ensures

that Board meetings are effective and that all Directors

receive accurate, timely and clear information.

The Chair communicates with shareholders effectively

and ensures that the Board understands the views of

major investors. The Chair also provides advice and

support to both the Executive and Non-executive

Board members. The Chair continues to meet the

independence criteria set out in provision 10 of the

Corporate Governance Code.

FRASERS GROUP PLC ANNUAL REPORT 2022

The Chief Executive

The Chief Executive provides leadership to the senior

leadership team in the day-to-day management of the

Group, with an emphasis on long-term goals, growth,

profit, and return on investment. He is instrumental in

formulating and implementing the Group’s strategy.

He is the main point of contact between the senior

leadership team and the Board and facilitates effective

communication and flow of information with the

Non-Executive Directors. Michael Murray became Chief

Executive on 1 May 2022. Mike Ashley and Michael

Murray worked together for a number of months, to

ensure a smooth transition into the role.

The Senior Independent Director

Richard Bottomley, OBE, is the Senior Independent

Non-executive Director. He works closely with the

Chair and provides support to both him and the other

Non-Executive Directors. He is also an alternative point

of contact for shareholders and is able to assist when

necessary if they have concerns. He is also responsible

for ensuring that the annual appraisal of the Chair’s

performance is completed and is supported by the

other Non-Executive Directors in this respect and for

overseeing the succession planning for the role of the

Chair. Richard is also chair of the Audit Committee and

has regular contact with the internal finance team and

the external auditor.

Role of the Non-Executive Directors

The Non-Executive Directors have extensive experience

from a wide range of sectors. Their role is to understand

the Group in its entirety, to constructively challenge

strategy and management performance, set executive

remuneration and ensure appropriate succession

planning is in place. The Non-Executive Directors

must also ensure they are satisfied with the accuracy

of financial information and that effective risk

management and internal control processes are in place.

Independence

There are currently three independent Non-Executive

Directors, as well as a Non-executive Chair of the Board,

a Non-executive Workforce Director, and three Executive

Directors, with the appointment of Michael Murray

as CEO on 1 May 2022. All Non-Executive Directors,

other than the Non-executive Workforce Director,

were considered independent upon appointment. The

Non-executive Workforce Director is not considered to

be independent as she is employed by the Group.

Delegation of Responsibilities

The Board has three sub-committees, namely the Audit

Committee, Remuneration Committee and Nomination

Committee. The Committees are governed by their

Terms of Reference, which provide details of matters

delegated to them. The Terms of Reference are available

on the Group’s website at frasers.group/financials/

corporate-governance and are reviewed annually to

ensure they remain fit for purpose. The roles of the

Chairman, Chief Executive and Senior Independent

Director are clearly defined and set out in writing.

FRASERS GROUP PLC ANNUAL REPORT 2022

Remuneration

Committee

Remuneration

policy

Remuneration

schemes

Service contracts

for senior executives

Key Board

Responsibilities

Approving budgets

Setting the Group’s values and standards

Approving strategic aims and objectives

Approving acquisitions and disposals

Approving the appointment or removal of

Board members

Approving foreign exchange and commodities

transactions above a material level

Audit

Committee

External audit

Financial reporting

Internal audit

Risk management

Compliance

and fraud

Nomination Committee

Composition of the Board

Succession planning

Matters reserved for the Board

There is a formal schedule of matters that require

Board approval before any action is taken by the senior

leadership team. The matters reserved for the Board

could have significant strategic, financial or reputational

impact on the Group so are subject to extra scrutiny. The

schedule of matters is reviewed annually and updated

by the Board when necessary.

Board and Committee Performance

Board, Committee and individual director performance

are evaluated annually in line with the requirements

of the Corporate Governance Code 2018. The

Non-Executive Directors, led by Richard Bottomley,

review the performance of the Chair, taking into

account the views of Executive Directors. The outcome

of the review is relayed to the Chair, with constructive

comments to improve his future performance.

During the period, the Chair reviewed the performance

of all Non-Executive Directors, to ensure their

performance remains effective and that they are

committed to and capable of performing the role. The

Chair has discussed with each Non-Executive Director

how they can improve their knowledge, behaviour and

skills, in order to be better equipped for the role. A skills

matrix is in the process of being produced to allow

objective analysis of where Board performance can be

improved. It will also be used as a tool in our succession

planning when recruiting new directors. The Board

and Nomination Committee had numerous meetings

throughout the year to discuss the appointment of

Michael Murray as CEO. These meetings reviewed his

performance during his property consulting role and as

Head of Elevation and identified the skills that he could

bring to the Board.

There was a thorough independent external evaluation

of the Board and its committees in FY21. The

performance of the board and its committees have

been discussed in the individual Board appraisals taking

into account the recommendations and comments

arising from the review in FY21.

Following the appointment of the new CEO in May

2022, the Board is intending to consider again the

recommendations of the external review and see

whether there are any further steps to take.

FRASERS GROUP PLC ANNUAL REPORT 2022

In addition to the evaluation of the Non-Executive

Directors, the performance of the Executive Directors

was also reviewed by the Chair and performance

objectives set. During the period, the Chair held informal

meetings with the Non-Executive Directors without the

Executive Directors present.

Director Commitment

Prior to accepting Board positions, prospective

Directors are informed that following induction, they

are required to dedicate between 15 and 20 days per

annum to fulfil the role of a Non-executive Director.

Non-Executive Directors are aware that scheduled and

unscheduled meetings may take place, as well as other

events including site visits, shareholder meetings and

strategy meetings. The time commitment specified in

Non-Executive Directors’ letters of appointment has

been reviewed by the Nomination Committee and is

considered appropriate. Regular training is offered to all

Directors and this is further considered during

Director evaluations.

The Directors are expected to attend all scheduled

Board meetings and are asked to use best endeavours

to attend unscheduled meetings. To assist with

managing their commitments, the Non-Executive

Directors are given prospective annual Board calendars

early in the second half of the preceding year. During

the year, there were six scheduled and six unscheduled

Board meetings.

Appointment Documentation

Details of Executive Directors’ service contracts,

and of the Chair’s and the Non-Executive Directors’

appointment letters, are given on page 81.

Copies of service contracts and appointment letters are

available for inspection at the Company’s registered

office during normal business hours and at the Annual

General Meeting. None of the Executive Directors hold a

directorship of another FTSE 350 company.

Meeting Documentation

A detailed agenda is established for each scheduled

meeting and appropriate documentation is provided to

Directors in advance. Regular Board meeting agenda

items include reports from the Chief Financial Officer,

reports on the performance of the business and current

trading, and specific proposals where the Board’s

approval is sought. The Board monitors and questions

performance and reviews anticipated results. The Board

also receives reports from the Non-Executive Workforce

Director, who attends all Board meetings.

During Board meetings, presentations are made on

business or strategic issues where appropriate, where the

Board considers the Group’s strategy at least annually.

Minutes of Committee meetings are circulated to all

Board members for agreement.

Copies of analysts’ reports and brokers’ notes are

also provided to Directors. The Board also receives

presentations from industry experts when necessary.

Board Meeting Attendance

The Board has a formal schedule of regular meetings

that is agreed and circulated in advance. Scheduled

meetings are used to approve standard regulatory

matters and make significant decisions and also provides

an opportunity for the Board to exercise its expertise to

advise and influence the business. The Board has the

capacity to meet on other occasions if decisions need to

be taken outside the scheduled meetings.

The Directors’ attendance at Board and Committee

meetings during the year, and the total number of

meetings that they could have attended, are set out in

the table below. Attendance was high for all Directors,

who attended all meetings unless prevented from doing

so by a prior commitment. There was an ongoing need

for unscheduled meetings during the year, to discuss

numerous decisions and matters outside the scheduled

Board meetings.

FRASERS GROUP PLC ANNUAL REPORT 2022

Board Meetings

Scheduled

Board Meetings

Unscheduled

Audit Committee

Meetings

Remuneration

Committee Meetings

Nomination

Committee Meetings

Mike Ashley 6/6 6/9

David Brayshaw 6/6 8/9 5/5 4/4 3/3

David Daly 6/6 9/9 5/5* 4/4 3/3

Nicola Frampton 5/6 9/9 3/5 4/4 3/3*

Richard Bottomley 6/6 8/9 5/5 1/4* 3/3

Cally Price 6/6 8/9 1/4* 1/3*

Chris Wootton 6/6 9/9 5/5* 1/4*

Anouska Kapur** 2/6

(attended 2/2 meetings

during her tenure)

0/9

(attended 0/1 meetings

during her tenure)

* Not a committee member but attended meeting.

** No longer a member of the Board.

Company Secretarial Support

All Directors have access to the advice and services of

the Company Secretary and may take independent

professional advice at the Company’s expense, subject

to prior notification to the other Non-Executive Directors

and the Company Secretary.

The Company Secretary ensures that the Company

maintains appropriate insurance cover in respect of its

Directors and Officers. He also advises the Board on

corporate governance matters.

The Group Position and Prospects

The Board takes responsibility for the preparation of

the Annual Report and Accounts for FY22, and is in

agreement that taken as a whole, they are fair, balanced

and understandable. for the Board’s statement on this

matter please refer to page 92. We are confident that

the Annual Report and Accounts provide sufficient

detail and that our shareholders have been provided

with the necessary information on the Group’s position,

performance, business model and strategy. Further

details on this can be found in the Strategic Report on

page 10. Detailed information on the financial position

and performance can also be located in the Group

Financial Statements located on pages 113 to 117.

As a result of its findings, the Board has adopted a

going concern statement for FY22, and full details of this

can be found in the Directors’ Report at page 95. The

Directors have also assessed the prospects of the Group

over a three-year period and the Viability Statement can

be found at page 63.

Risk Management

The Board’s responsibilities and procedures for

managing risk and the supporting systems of

internal control are set out in the Principal Risks and

Uncertainties section of the Strategic Report. Further

information is included in the Audit Committee Report.

Controls in respect of financial reporting and the

production of the consolidated financial statements

are well established. Group accounting policies are

consistently applied and review and reconciliation

controls operate effectively. Standard reporting

packages are used by all Group entities to ensure

consistent and standard information is available for the

production of the consolidated financial statements.

The Board has carried out a robust assessment of the

Groups’ emerging and principal risks in the period and

further detail can be found in the Strategic Report and

Principal Risk and Uncertainties section as noted above.

FRASERS GROUP PLC ANNUAL REPORT 2022

THE BOARD

David Daly

Non-Executive Chair of the Board, Chair of the

Nomination Committee

Appointed: 2 October 2017

Committees: Nomination and Remuneration

Committees

Previous roles:

David has held a number of positions during a 30-year

international career with Nike, where his primary focus

was the business of football. He started in a sales role in

1986 later becoming sales director for Nike UK/Ireland.

He retired in 2015 as a Senior Director for Nike’s Club

and Federation business, where he was responsible for

global merchandising business for all of Nike’s leading

football clubs.

Present roles:

David is a Non-Executive Director of Fulham

Football Club.

Key skills, experience and contribution:

David has significant knowledge of the sporting goods

industry having worked at Nike for 30 years. He has

worked in senior roles in sales, marketing, product

development and general management, which has

given him a thorough understanding of consumer

trends and behaviour. He has spent 18 years working

outside the UK and this international experience

has proven crucial to the Board. David joined the

Group as a Board member in October 2017, gaining a

much-needed understanding of the business, before

being appointed as Chair in October 2018. His focus has

been on improving best practices, corporate governance,

promoting diversity and driving the Elevation strategy.

He ensures the Board functions effectively by facilitating

an open and productive debate and providing

constructive challenge.

Michael Murray

Chief Executive Officer

Michael Murray is Chief Executive of Frasers Group; he

will accelerate the Group’s strategy to achieve its vision:

‘to serve our customers with the World’s best sports, premium

and luxury brands.’

Michael has had a relationship with the Group dating

back to 2015 when his consultancy services (through MM

Prop Consultancy Limited) commenced.

He was first tasked with rethinking and implementing

the elevation of the Group’s national and international

property portfolio. As part of that strategy, the Group

pursued a £1bn investment strategy, reinvigorating

the Group’s estate, transforming customer in-store

experience, and repositioning the Group in the eyes of

key stakeholders and brands. This work was to form the

bedrock of the Group’s future Elevation strategy.

Through the implementation of the property Elevation

strategy Michael demonstrated a clear vision for future

business growth and also the potential for a full scale

re-imagining of the market identity of the Group. This

encouraged the Group to completely re-evaluate its

intended future consumer offering, ultimately leading to

the decision of the Group to rebrand from Sports Direct

International plc to Frasers Group Plc.

Building on the success of the property Elevation

strategy Michael was tasked by the Group with using his

vision to provide non-property elevation services to the

Group, encompassing investing in brands, technology,

retail environments and 360 digital innovation. Michael’s

unrivalled vision, and willingness to shake up the industry,

allows the Group to continue its uniquely impressive

trajectory and to pioneer the business’s development.

Michael has been instrumental to the growth and

continued success of FLANNELS - the multi-category

retailer that has reinvented luxury retail and revived

in-store experiences across the UK. Stocking the biggest

names in luxury fashion and beauty, FLANNELS has

become one of the most exciting players in the industry.

During his time working with the Group, Michael has

also revolutionised Sports Direct, by evolving the product

offering, investing in physical store experiences, and

establishing the business’ identity as the leading sports

destination - championed by an all-new aesthetic and

brand mission.

FRASERS GROUP PLC ANNUAL REPORT 2022

Mike Ashley

Director

Appointed: 1982 (founder)

Previous roles:

Mike established the business of the Group on leaving

school in 1982 and was the sole owner until the Group’s

listing in March 2007. He was Executive Deputy Chair

prior to being appointed Chief Executive in September

2016 before handing over the role to Michael Murray on

1 May 2022.

Key skills, experience and contribution:

Mike was the founder of the Group and has the

necessary skills for formulating the vision and

commercial strategy of the Group. With over 30 years

in the sports retail business with Sports Direct, he

is invaluable to the Group. Mike’s knowledge and

experience in all areas of retailing, buying, warehousing

and logistics ensures that he is crucial to the effective

and efficient running of operations. With the continuing

challenges in the macro-economic environment his

decisive leadership has meant the Group has remained

resilient and in good health and will be able to take

advantage of future opportunities.

Chris Wootton

Chief Financial Officer

Appointed: 12 September 2019

Previous roles:

Chris worked at PwC for the early part of his accounting

career in the assurance practice, including work on large

corporates and listed entities.

Key skills, experience and contribution:

Chris is a Chartered Accountant and has provided key

support in the transition to the new leadership team.

He continues to improve the skills, experience and

capabilities of the Frasers Group Finance team. Chris is

a key driver of the Group’s accounting principles, namely

being conservative, consistent and simple.

Chris was instrumental in negotiating the recent renewal

of the Group’s combined term loan and revolving credit

facility during the financial year.

Cally Price

Non-Executive Workforce Director and Workers’

Representative

Appointed: 1 January 2019

Previous roles:

Cally began her career with Sports Direct as a casual

sales assistant in our Aberdare store in 2007.

Present roles: Company’s Workers’ Representative

Key skills, experience and contribution:

Cally has been with the Group for over 13 years,

commencing on the shop floor working as a casual

assistant. Cally continues to manage the Cardiff

Sports Direct store giving her a unique insight into the

challenges of the retail sector from those on the ground.

Richard Bottomley OBE

Senior Independent Non-Executive Director, Chair of

the Audit Committee

Appointed: 1 October 2018

Committees: Audit and Nomination Committees

Previous roles:

Richard has over 25 years’ experience working with listed

companies during his time as a senior partner at KPMG,

and continues to be a member of the Audit Committee

Institute. Until recently Richard was a Non-Executive

Director of Newcastle Building Society, where he chaired

the Audit Committee.

Present roles:

Richard is a Non-Executive Director of MSL Property

Care Services Ltd, Marsden Packaging Limited and

Jessgrove Limited.

Key skills, experience and contribution:

Richard has strong experience in corporate governance,

corporate finance and strategy. He has been influential

in the recruitment and appointment of a Head of

Internal Audit, ensuring that risks are properly assessed

and mitigated.

FRASERS GROUP PLC ANNUAL REPORT 2022

David Brayshaw

Independent Non-Executive Director, Chair of the

Remuneration Committee

Appointed: 8 December 2016

Committees: Audit, Nomination and Remuneration

Committees

Previous roles:

David is a very experienced senior investment and

commercial banker. He has over 30 years’ experience

with organisations such as Barclays Capital, HSBC,

Citigroup and Pilkington plc.

Key skills, experience and contribution:

David graduated from Oxford in 1975 with a Master

of Arts in Chemistry. He has spent a long career in

the field of corporate financing for a number of major

financial institutions and was also the Group Treasurer

of Pilkington plc. David spent 15 years of his career at

Barclays Capital, advising FTSE 350 companies on all

aspects of corporate, syndicated, and capital markets

funding, together with interest rate, foreign exchange

and balance sheet hedging. He has funded countless

public company acquisitions and still remains involved

in an advisory role with several corporates and banks in

a private capacity. He has a proven track record in the

finance and acquisitions sector, providing sound advice

in line with the Group’s Elevation strategy.

Nicola Frampton

Independent Non-Executive Director

Appointed: 1 October 2018

Committees: Audit and Remuneration Committees

Present roles:

Nicola has spent the majority of her recent career in

senior executive management roles and has recently

been appointed to a new senior executive role with

Domino’s Pizza Group, where she is Chief

Operations Officer.

Previous roles:

Prior to joining Domino’s Pizza Group, Nicola was the

Managing Director of William Hill’s UK Retail division

from April 2010, working closely with William Hill’s Board,

Executive Committee and operational management.

During her time at William Hill, Nicola led a number of

successful major innovation and transformation projects.

Before switching to an executive management career,

Nicola spent the previous ten years working in the

professional services industry, most recently as a Director

at Deloitte.

Key skills, experience and contribution:

Nicola has extensive experience in risk management,

assurance and corporate governance across a wide

range of industries, having specialised in these areas

of corporate activity at both William Hill and prior to

that whilst at Deloitte. The Board also benefits from

Nicola’s current and previous retail experience running

large, non-competing retail businesses. Nicola serves

as a Trustee Board member for a number of charities

and brings an informed perspective on corporate

responsibility to the Board.

FRASERS GROUP PLC ANNUAL REPORT 2022

NOMINATION COMMITTEE REPORT

Dear Shareholder

To meet the Group’s needs, the Nomination Committee

must ensure that the Board remains competent, diverse,

well balanced and equipped to deal with any present

or future issues which may arise. It is also important

that the Nomination Committee both supports and

challenges the decisions of the Executive Directors,

which includes reviewing the Group’s leadership and

making recommendations regarding the appointment

of new Directors and extending the term of office of

existing Directors.

Biographical details of each Committee member are

shown in the Board of Directors’ profiles on pages 72

to 74.

The Nomination Committee usually meets formally

twice a year, although additional meetings take place

when appropriate. The Committee formally met three

times during FY22, with meetings returning to physical

meetings following the end of Covid-19 restrictions.

All members of the Nomination Committee are

Non-Executive Directors and, with the exception of the

Chair, are considered to be independent.

The Responsibilities of the Nomination

Committee Include:

• reviewing the leadership needs of the Group, looking

at both Directors and senior management;

• reviewing the composition, structure and size of

the Board, and recommending adjustments to the

Board, having regard to diversity, skills, knowledge

and experience;

• reviewing the time the Non-Executive Directors are

required to spend discharging their duties;

• identifying and nominating, for the approval of the

Board, candidates to fill Board vacancies as and

when they arise;

• considering succession planning for Directors

and senior management, taking into account the

challenges and opportunities facing the Group and

the skills and expertise therefore needed on

the Board;

• formally documenting the appointment and

re-appointment of Directors;

• identifying potential candidates for senior posts, and

making recommendations to the Board; and

• considering the recommendations to shareholders

for re-electing the Directors, under the annual

re-election provisions of the 2018 UK Corporate

Governance Code.

A full list of the Committee’s responsibilities is set out in

its Terms of Reference which are available on the Group

Website: www.frasers.group.

What has the Committee Done During

the Year?

Board Nominations

• The Committee considered and recommended to

the Board the reappointment of Nicola Frampton

and Richard Bottomley.

• The Committee considered and recommended the

election or re-election of all Directors at the AGM,

following consideration of their effectiveness

and commitment.

Composition of the Board

The Committee has reviewed the Board’s composition

and we continue to look to add talented people to the

Board, who will bring appropriate skills and experience.

The Committee has begun work on preparing a skills

matrix that will identify key areas in which Board

members have experience in order to identify the areas

in which board knowledge could be strengthened. This

is being updated to take into account the skills that

Michael Murray brings to the Board. The results will be

used to influence future Board appointments. The Board

continues to have dialogue with external recruitment

agents, a number of which specialise in recruiting

diverse candidates.

Annual Performance Appraisals

All Board members, both Executive and Non-Executive,

went through an annual performance review during

FY22 and each Director engaged fully in the process.

This included setting objectives for each individual. I

led these appraisals, as Chair of the Board and the

Nomination Committee. This process will be repeated

annually. Richard Bottomley, Chair of the Audit

Committee and Senior Independent Non-executive

Director, led my performance appraisal and

objective setting.

The Directors will take into account any development

needs identified in their appraisals and will be

challenged on how they have taken action against these

objectives during their next annual appraisal.

The results of appraisals will be used to influence

Board appointments.

FRASERS GROUP PLC ANNUAL REPORT 2022

Diversity and Inclusion

At the period end the Board had two female Directors,

representing 29% of the Board. There is currently no

representation from ethnic minority backgrounds on the

Board. However, the Board is conscious of the targets set

by the FCA which apply for the FY23 financial year and

its reporting requirements in respect of this.

The Group’s objectives in relation to Board diversity and

inclusion are:

• To ensure that the Board has an appropriate mix of

skills, experience and knowledge, to ensure a variety

of perspectives are represented on the Board and

enable the Board to effectively oversee and support

the Group’s growth and management.

• To maintain Board representation from the workforce,

which brings the voice of colleagues into the

boardroom, supports our strategy of investing in our

people and enables the Board to effectively oversee

and support the Group’s growth and management.

• To increase female representation and

ethnic minority representation at both senior

management and Board level, in line with the FCA’s

recommendations.

The Group achieved its Diversity policy objective in

respect of gender and age, by having a strong gender

balance in senior management and their direct reports,

and a varied representation of ages in middle and senior

management. When reviewing candidates who may

become potential Board members, the Committee has

regard to factors including professional experience, skills,

education, gender, ethnicity and background, to ensure

a variety of perspectives are represented at Board

level. As discussed above, we have been working with

a recruitment agent specialising in diverse candidates.

The Board is conscious that to successfully deliver the

strategic goals of the business, our people, including the

Board of Directors must reflect the diverse cultures and

values of our customer base.

The Committee recognises the advantages of having

a diverse team and has therefore reviewed the

composition of the senior management team, including

their direct reports. A number of senior management

roles were held by women at period end, including the

Chief Marketing Officer, Head of Sustainability, Head of

Consumer Credit, Head of PR and Communications and

the UK Group Financial Controller.

The table below shows the gender diversity of our

workforce at the period end. Approximately 54% of

our workforce is female, including 36% of our senior

management (FY21: 35% UK workforce). We aim to

ensure that both male and female candidates are

provided with equal opportunities to apply for and work

in all positions across the Group.

Female Male

Directors

29% 71%

Other senior managers and

direct reports

36% 64%

Other employees

55% 45%

We were pleased that our most recent Gender Pay Gap

Report showed that we have maintained a 0% gender

pay gap.

Further details on diversity and inclusion are set out in

the Our People section.

David Daly

Chair of the Nomination Committee

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

DIRECTORS’ REMUNERATION

REPORT

Dear Shareholder,

As the Chair of the Remuneration Committee (the

Committee), I am pleased to present our Directors’

Remuneration Report for the period ended 24 April 2022.

This report is split into three parts: this Annual Statement,

a summary of our Directors’ Remuneration Policy for

FY22-FY25 and the Annual Report on Remuneration.

As a first item, the Remuneration Committee wishes

to thank our shareholders for the support which they

gave to the resolutions on remuneration matters at

our September 2021 AGM. Each of the three AGM

resolutions, which were to approve our revised

Directors’ Remuneration Policy, to approve our Directors’

Remuneration Report and to approve the establishment

of the Executive Share Scheme (‘ESS’) was approved by

shareholders at levels of voting which indicted strong

support from both our full shareholder base and also by

our independent shareholders who voted.

Board Changes

As shareholders will have seen, on 1 May 2022 Michael

Murray became our new Chief Executive Officer. Details

of Michael’s pay arrangements as our CEO (and which

are consistent with information already provided to

shareholders when this appointment was announced

in Summer 2021) are set out in this report. On 1 May

2022, Michael was formally granted an award under

the ESS, the terms of which had been communicated

to shareholders as part of the arrangements for the

approval of the ESS at our September 2021 AGM.

Mike Ashley remains on our Board as a director. Mike

receives no compensation for this role and he received

no compensation in relation to his stepping down

as Group CEO. On 20 September 2022 the Group

announced that Mike Ashley would not be standing for

re-election as a director at this year’s Annual General

Meeting (“AGM”) and that he will therefore step down

from the Board upon the conclusion of the AGM.

Actions Taken in FY22 and Impacts on Pay

Notwithstanding the several aspects of positive

Company performance in FY22, the Remuneration

Committee has not awarded an annual cash bonus for

the year to our CFO.

The Committee exercised what it regards as normal

commercial judgement in respect of Directors’

remuneration throughout the year (and in all cases in

line with the Company’s Directors’ Remuneration Policy).

There were no other exercises of judgement or discretion

by the Committee save as detailed in this report.

Operation of Remuneration Policy in FY23

It is the Committee’s intention to operate the

Remuneration Policy in FY23 consistent with how the

policy was operated in FY22.

• our Executive Directors’ salaries for FY23 are

unchanged (CEO: £1,000,000; CFO £250,000);

• in line with our shareholder approved Directors’

Remuneration Policy, our FY23 annual bonus for

our Executive Directors will be operated with a

maximum pay-out potential of 200% of base salary;

and

• there will be no further awards of LTIPs made

to the Executive Directors in FY23 (other than

implementation of the ESS awards for our CEO

which were approved at our FY21 AGM).

Format of the Report and Matters to be Approved at

Our 2022 AGM

At the FY22 AGM, shareholders will be asked to approve

the Directors’ Remuneration Report for FY22. This will be

the normal annual advisory vote.

I hope that our shareholders remain supportive of our

approach to executive pay at Frasers and vote in favour

of the resolutions on remuneration matters to be tabled

at the FY22 AGM.

David Brayshaw

Chair of the Remuneration Committee

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

Directors’ Remuneration Report

This report contains the material required to be set out

as the Directors’ Remuneration Report for the purposes

of Part 4 of the Large and Medium-sized Companies

and Groups (Accounts and Reports) (Amendment)

Regulations 2013, which amended the Large and

Medium-sized Companies and Groups (Accounts and

Reports) Regulations 2008 (the DRR Regulations).

Directors’ Remuneration Policy

The Directors’ Remuneration Policy was approved by

shareholders at the 29 September 2021 AGM. The full

Remuneration Policy as approved by shareholders can

be found on pages 52 to 57 of the 2021 Annual Report, a

copy of which is also available on the Group’s corporate

website at https://www.frasers.group. for ease of

reference, we have set out below the Future Policy Table

for Executive Directors, as included in the approved

Directors’ Remuneration Policy.

FRASERS GROUP PLC ANNUAL REPORT 2022

Future Policy Table

The table below describes each of the elements of the remuneration package for the Executive Directors.

Element of

Remuneration

Purpose /

Link To Strategy

Operation Maximum Performance Measures

Changes To

Policy Approved

At The 2021 AGM

BASE SALARY Fixed element of the

remuneration package,

where the balance of fixed

and variable remuneration

is aligned to the commercial

strategy of long-term

profitable growth and

reflects the Company

remuneration philosophy

of gearing reward to

performance, with a sharing

of risk between Executive

Directors and shareholders.

Base salaries are normally

reviewed annually.

Mike Ashley does not

currently receive a salary for

his role.

Although salaries for

Executive Directors (other

than Mike Ashley, who

does not currently receive

a salary) are set at levels

below the amounts typically

paid by similar-sized

companies, the Committee

retains discretion to set

salaries at levels considered

appropriate for the business,

considering its size and

complexity.

Not applicable. No change.

BENEFITS With the exception of a

20% colleague discount

on products purchased

from the Group’s retail

stores, which is available

to Executive Directors

other than Mike Ashley,

no additional benefits

are generally available to

Executive Directors. The

same level of discount is

available to all colleagues.

The current Executive

Directors do not receive

any benefits other than the

colleague discount, which

is not available for Mike

Ashley.

Benefits may be provided

in line with market practice

to recruit a new Executive

Director taking into account

individual circumstances.

Such benefits may include

relocation expenses.

Although the Remuneration

Committee has not set an

absolute maximum level of

benefits Executive Directors

may receive, the Company

retains discretion to set

benefits at a level which the

Remuneration Committee

considers appropriate

against the market and

to support the on-going

strategy of the Company.

Not applicable. No change.

RETIREMENT

BENEFITS

Provide post-employment

benefits to recruit and retain

individuals of the calibre

required for

the business.

The Executive Directors are

entitled to participate in a

stakeholder pension scheme,

on the same basis as other

employees.

On request, this benefit

may be paid as a salary

supplement in lieu of

pension contribution,

as necessary.

The current maximum

employer contribution to the

stakeholder pension scheme

is 3%.

The Committee may

increase employer

contribution rates to

reflect changes in the

auto enrolment employer

contribution rates.

Not applicable. No change.

ANNUAL

BONUS

Rewards the Executive

Directors for performance

which supports the Group’s

strategy and performance

in role.

Executive Directors, other

than Mike Ashley, may earn

a bonus. Any bonus earned

in excess of 100% of salary

would be deferred into

shares for a period of two

years, unless the amount

to be deferred would be

less than £10,000. The

Committee also retains a

discretion not to operate

deferral in an exceptional

case and where salary paid

in the year was £250,000

or less.

Any bonus paid would be

subject to clawback for

a period of three years

following its determination,

in the event of gross

misconduct, material

misstatement of the

Company’s financial

statements or corporate

failure.

The maximum bonus that

an Executive Director may

earn shall be 200% of salary

in respect of any

financial year.

Any bonus opportunity shall

be assessed against one or

more metrics determined

by the Committee and

linked to the Company’s

strategy and/or the

performance of the

Executive Directors in role,

with the weighting between

the metrics determined

by the Committee, if

relevant. Bonuses will be

determined between 0%

and 100% of the maximum

opportunity, based on the

Committee’s assessment of

the applicable metrics.

The annual bonus plan is a

discretionary arrangement

and the Committee

retains a standard power

to apply its judgement

to adjust the outcome of

the annual bonus plan for

any performance measure

(from zero to any cap)

should it consider that to be

appropriate.

No change.

FRASERS GROUP PLC ANNUAL REPORT 2022

Element of

Remuneration

Purpose /

Link To Strategy

Operation Maximum Performance Measures

Changes To

Policy Approved

At The 2021 AGM

LONG-TERM

INCENTIVES

To motivate and incentivise

delivery of sustained

performance over the

long-term, and to promote

alignment with shareholders’

interests, the Company

intends to operate an

Executive Share Scheme.

Executive Directors, other

than Mike Ashley, may

receive awards under the

Executive Share Scheme.

Awards may be granted

as nominal cost options or

conditional share awards,

which vest to the extent the

performance conditions are

satisfied over a period of

four years.

The Committee shall have

discretion to reduce the

number of shares subject

to an award granted under

the Executive Share Scheme

by an amount equal to

the aggregate gross salary

received by a participant

during the performance

period.

Clawback and malus

provisions apply to awards

granted under the Executive

Share Scheme. Any

amounts received under the

Executive Share Scheme

may be subject to clawback

for a period of three years

following the end of the

performance period, in the

event of gross misconduct,

material misstatement of

the Company’s financial

statements, corporate failure

or reputational damage.

As is normal, the

Committee retains power

to settle awards in cash in

exceptional cases only.

For awards with a £15 share

price target, the maximum

opportunity for an Executive

Director will be an award

over 6,711,409 shares.

For awards with a £12 share

price target, the maximum

opportunity for an Executive

Director will be an award

over up to 600,000 shares.

Awards will vest subject

to an absolute share price

target of either £12 or £15.

The share price must be

over the target for any

period of 30 consecutive

dealing days during the

four-year performance

period.

The Committee may set

additional performance

conditions on awards under

the Executive Share Scheme,

as it considers appropriate.

For information: there are

two underpins applying

which relate to satisfactory

performance ratings for

each participant, and

anticipated delivery of our

Elevation strategy.

Introduction of the

Executive Share

Scheme, which is

our new long-term

incentive plan that

will reward our

senior executives

for achieving

sustained

performance over

the long term.

FRASERS GROUP PLC ANNUAL REPORT 2022

Service Contracts and Policy on Payments

for Loss of Office

The Company’s policy is for Executive Directors to be

employed on the terms of service contracts which may

be terminated by either the Company or the Executive

Director on the giving of not more than 12 months’

notice. All Directors are subject to annual re-election.

Executive Directors

Details of the current service contract for each Executive

Director are set out below:

Contract

Date

Unexpired Term

/ Notice Period

Governing

Law

Mike Ashley 11/02/2007 12 months*

England &

Wales

Michael Murray 20/09/2022 6 months

England &

Wales

Chris Wootton

06/03/2017 6 months England &

Wales

*The Company may terminate Mr Ashley’s service contract by giving six months’ notice if

he is unable to perform his duties for over 120 days in any consecutive 12 months.

Non-Executive Directors

The Non-Executive Directors enter into an agreement

with the Group for a period of three years, other than

the Chair whose agreement continues until terminated

in accordance with its terms. The appointments of

the Non-Executive Directors may be terminated

by either party on one month’s written notice and

in accordance with the Articles of Association of

the Company. Termination would be immediate in

certain circumstances (including the bankruptcy of the

Non-executive Director).

Non-Executive Directors (other than the Non-executive

Workforce Director) do not and are not entitled

to participate in any bonus or share scheme. The

Non-executive Workforce Director is entitled to

participate in employee bonus and share schemes for

employees, including all-employee schemes.

The approach to determining Non-Executive Directors’

pay is to benchmark ourselves against other companies/

retailers within the FTSE 250 with remuneration

ultimately a Board responsibility.

Non-Executive Directors are subject to confidentiality

undertakings without limitation in time. Non-Executive

Directors are not entitled to receive any compensation

on the termination of their appointment.

Details of the Non-Executive Directors’ letters of

appointment are set out below:

Position

Date of Letter

of Appointment

End Date of

Appointment

David Daly

Non-executive

Chair of the

Board

16 July 2020 1 October 2023

David Brayshaw

Non-executive

Director

23 April 2020

7 December

2022

Nicola

Frampton

Non-executive

Director

1 October 2018

30 September

2024

Richard

Bottomley

Non-executive

Director

1 October 2018

30 September

2024

Cally Price

Non-executive

Workforce

Director

6 October 2020 5 October 2022

(1) The original three year terms of appointment for Nicola Frampton and Richard

Bottomley have been extended for a further three years, subject to continuing

annual re-election at the AGM.

Copies of the service contracts of Executive Directors

and of the appointment letters of the Chair and

Non-Executive Directors are available for inspection at

the Company’s registered office during normal business

hours and at the AGM.

Engagement with Shareholders

The Committee consults major shareholders and

representative groups where appropriate concerning

remuneration matters. General representations have

been received from investors regarding overall FTSE

remuneration. The Committee has due regard to the

Investment Association principles, and is always happy

to receive feedback from shareholders. There have been

no changes to the Remuneration Policy or outcomes as

a result of shareholder engagement.

Colleague Reward

It is worth reminding shareholders that our UK

colleagues (excluding the Executive Directors) who

have participated in our share schemes have received,

subsequent to any IPO bonus payments, a total value of

£250m (FY21: £250m) of awards since their introduction.

In addition to share schemes, the Company operates

other bonus and incentive awards for its workforce. By

way of recent example, in FY22 the Group paid awards

and incentives of approximately £15.0m (FY21: £5.4m). A

significant proportion of these other bonus and incentive

awards was paid to our casual retail workers.

During FY21, the Company launched the Frasers

All-Employee Omnibus Plan (known as ‘Fearless 1000’)

following approval by shareholders at the 2020 AGM.

The Fearless 1000 plan is available to all eligible and

qualifying Fraser Group employees (except for the Chief

Executive, Chief Financial Officer, Chief Commercial

Officer and Chief Operating Officer) and is intended to

provide a significant one-off reward for employees if a

stretching share price growth target is achieved within a

five year period measured to October 2025.

FRASERS GROUP PLC ANNUAL REPORT 2022

There are two related but distinct parts to the Fearless

1000 plan as follows:

• share awards to those 1,000 eligible and qualifying

employees in the business who most demonstrate

outstanding service and performance consistent

with the Company’s values; and

• cash bonuses to eligible and qualifying employees

in the Company’s Group, to reward them for their

loyalty and hard work.

A similar incentive plan is also available for our

non-employee Group workers.

The Remuneration Committee remains committed to

transparent and simple remuneration for Executive

Directors, based upon reward for significant financial

and personal performance only. The Committee also

remains committed to appropriately rewarding our large

and loyal workforce.

Our Workforce-nominated Director, Cally Price engages

with colleagues through regular and multi-channel

communication mechanisms. This enables colleagues to

understand the strategy of the Company, the vital role

all colleagues play in contributing to the overall success

of the Group and how this is rewarded and to raise any

questions directly with a Board member. Cally has been

directly involved in the review of retail colleague pay

during FY22. The Committee has reviewed the salaries,

other remuneration and other employment conditions of

senior and middle managers throughout the Group and

has taken them into account in considering Directors’

salaries. The Committee has considered pay and

employment conditions of colleagues (other than the

Directors) and has aligned pension contributions and

colleague discounts of the Directors with employees.

Whilst the Company has not directly consulted with

employees on Directors’ remuneration, the views of

colleagues can be expressed by the Workforce Director.

Annual Report on Remuneration

This part of the Directors’ Remuneration Report sets

out the actual payments made by the Company to its

Directors with respect to the period ended 24 April 2022

and how our Directors’ Remuneration Policy will be

applied in the year commencing 25 April 2022.

Base Salary and Fees

Michael Murray’s salary will be £1,000,000 per annum,

with effect from the start of his employment on 1 May

2022. Chris Wootton’s salary will remain at £250,000 per

annum (no change from FY22).

Mike Ashley does not receive a salary for his role.

Fees for the Chair and Non-Executive Directors are

normally reviewed annually. In respect of fees for FY23,

David Daly will receive an annual fee of £200,000

(FY22: £150,000) for his role as Chair. Richard Bottomley

will receive £75,000 for his role as Senior Independent

Director (FY22: £65,000). David Brayshaw and Nicola

Frampton will each receive a fee of £65,000 (no change

from FY22) for their roles as Non-Executive Directors.

Cally Price will receive a fee of £15,000 (no change from

FY22) for her role as Non-executive Workforce Director.

Pension

The contribution rate for Michael Murray and Chris

Wootton will be 3% of salary, capped at £50,000 of

salary, being the maximum employer contribution rate

available under the Company stakeholder pension

scheme. No Director participates in a defined benefit

scheme (FY21: none).

Mike Ashley is not eligible to receive employer

contributions under the Company stakeholder

pension scheme.

Annual Bonus Scheme

Michael Murray and Chris Wootton will be eligible to

earn a bonus in respect of FY23. Any amount earned

shall be determined by reference to one or more

performance metrics determined by the Committee and

linked to the Company’s strategy and/or the Executive

Director’s performance in role. The Committee will

provide appropriate and relevant levels of retrospective

disclosure of the assessed criteria applied to the FY23

bonus. Any such bonus shall be of up to 200% of salary,

and any bonus earned in excess of 100% of salary may

be subject to deferral.

Mike Ashley shall not be eligible to earn a bonus in

respect of FY23.

FRASERS GROUP PLC ANNUAL REPORT 2022

Long-Term Incentives

Michael Murray and Chris Wootton are both eligible to participate in the new Executive Share Scheme (which was

approved by shareholders at the 2021 AGM). Chris Wootton received an award over 600,000 shares in FY22 and

Michael Murray received an award over 6,711,409 shares as soon as practical after he joined the Board in FY23.

Awards under the Executive Share Scheme are due to vest after a four-years performance period ending in October

2025, subject to a stretching absolute share price performance target (£15 for the proposed award to Michael Murray

and £12 for the award made to

Chris Wootton).

In addition to the share price performance measure, awards under the Executive Share Scheme will be granted subject

to two underpins requiring:

i. satisfactory performance ratings for the Executive Director during the term of the award; and

ii. anticipated delivery of the Company’s

Elevation strategy.

Mike Ashley is not eligible to be granted awards under the Executive Share Scheme.

Single Figure Table (Audited)

The aggregate remuneration provided to individuals who have served as Directors in the period ended 24 April 2022 is

set out below, along with the aggregate remuneration provided to individuals who have served as Directors during the

prior financial year.

Director

Salaries

and fees

Other

benefits

Bonus

Long-term

incentive

schemes

Pension

(1)

Total

Total fixed

remuneration

Total variable

remuneration

FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21

£000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000 £000

Executive Directors

Mike Ashley

- - - - - - - - - - - - - - - -

Chris Wootton

250 150 - - - 100 - - 1 1 251 251 251 151 - 100

Non-Executive Directors

David Daly

150 100 - - - - - - - - 150 100 150 100 - -

David Brayshaw

65 50 - - - - - - - - 65 50 65 50 - -

Nicola Frampton

65 50 - - - - - - 1 1 66 51 66 51 - -

Richard Bottomley

65 50 - - - - - - - - 65 50 65 50 - -

Cally Price

15 15 - - - - - - - - 15 15 15 15 - -

Anouska Kapur

22 - - - - - - - - - 22 - 22 - - -

Total

632 415 - - - 100 - - 2 2 633 517 633 417 - 100

(1) Pensions are provided via a defined contribution to the Company stakeholder pension scheme (see note 38).

FRASERS GROUP PLC ANNUAL REPORT 2022

Further Information on the FY22 Annual

Bonus (Audited)

Chris Wootton received a bonus of £nil in respect of

FY22 (FY21: £100k).

Payments for Loss of Office and Payments

to Former Directors (Audited)

No payments for loss of office or payments to former

Directors were made in FY22 (FY21: nil).

Statement of Directors’ Shareholding and

Share Interests (Audited)

The beneficial interests of the Directors who served

during the year and of their connected persons, in

both cases at the beginning of the financial year, or at

the date of appointment if later, and at the end of the

financial year, or at the date of resignation if earlier, in

the share capital of the Company are shown below:

Ordinary

Shares held at

24 April 2022*

Ordinary

Shares held at

25 April 2021*

Mike Ashley

330,000,000 330,000,000

Chris Wootton

- -

David Daly

31,563 24,205

Nicola Frampton

5,732 5,732

David Brayshaw

31,611 31,611

Richard Bottomley

10,000 10,000

Cally Price

- -

Anouska Kapur

- -

*or if earlier the date of resignation

There has been no change to the interests reported

above between 24 April 2022 and 20 September 2022

(being the latest possible date for inclusion in the 2022

Annual Report). The Company did not receive any

notifications under DTR 5 between 24 April 2022 and 20

September 2022.

As at 24 April 2022 and the reporting date, Michael

Murray held an equity derivatives contract which is the

economic equivalent of the holding of 6,851,120 Frasers

Group Plc ordinary shares.

In addition, Executive Directors hold outstanding scheme

interests under the Executive Share Scheme as follows:

Executive

Director

(1)

Awards held

at 26 April

2021

Awards

granted

during the

year

(2)(3)

Awards

lapsed

during the

year

Awards held

at 24 April

2022

Chris

Wootton

- 600,000 - 600,000

(1) Mike Ashley is not eligible to participate in the Executive Share Scheme.

(2) Awards are granted in the form of a conditional share award.

(3) The award to Chris Wootton was granted on 14 October 2021 and has a face value

of £3.8m, based on a closing share price of 632 pence per share on the date

of grant.

Awards under the Executive Share Scheme are subject

to a stretching share price target measured over a four-

year performance period to October 2025. In the case of

the award to Chris Wootton, the share price target is £12

per share for 30 consecutive trading days. In addition,

each award is subject to underpins relating to:

i. achievement of satisfactory performance ratings for

each participant; and

ii. anticipated delivery of the Company’s Elevation

strategy.

FRASERS GROUP PLC ANNUAL REPORT 2022

Performance Graph and Table

The following graph shows the Company’s performance measured by total shareholder return compared with the

performance of the FTSE 100 and FTSE 250 Index (excluding investment trusts).

The Committee considered these as appropriate indices against which to compare the Company’s performance.

They are widely accepted as national measures and include the companies that investors are likely to consider as

alternative investments.

Total Chief Executive Remuneration and Performance-Related Pay

The table below shows details of the total remuneration and performance-related pay for the Company’s Chief

Executive over the last ten financial years.

Total remuneration

Long term incentive scheme vesting as a % of

maximum opportunity

FY22 - Mike Ashley

Nil N/A

FY21 - Mike Ashley

Nil N/A

FY20 - Mike Ashley

Nil N/A

FY19 - Mike Ashley

Nil N/A

FY18 - Mike Ashley

Nil N/A

FY17 - Mike Ashley

(1)

Nil N/A

FY17 - Dave Forsey

(2)

£62,500 N/A

FY16 - Dave Forsey

£150,000 N/A

FY15 - Dave Forsey

£150,000

(3)

FY14 - Dave Forsey

£150,000 N/A

(1) Mike Ashley was appointed as Chief Executive with effect from 22 September 2016.

(2) Dave Forsey resigned with effect from 22 September 2016. His total remuneration is his remuneration earned

in the period from 25 April 2016 until the date his resignation took effect.

(3) The figures for FY15 reflect Dave Forsey’s decision on 6 June 2016 to forego an award over 1 million shares

which would otherwise have been due to vest on 6 September 2017.

FRASERS GROUP PLC ANNUAL REPORT 2022

Chief Executive to Employee Pay Ratio

In line with reporting requirements, the Company is required to disclose ratios which compare the total remuneration

of the Chief Executive to the remuneration of the 25th, 50th and 75th percentile of the Group’s UK employees. The

Company has not disclosed these ratios and associated supporting information on the basis that Mike Ashley who

was the CEO during FY22 is not remunerated by the Company.

Annual Percentage Change in Remuneration of Directors and Employees

The table below shows the percentage change in remuneration of the Directors and employees of the business

between FY21 and FY22 and between FY20 and FY21.

% Change From FY21 To FY22 % Change From FY20 To FY21

Salary or fees Benefits Bonus Salary or fees Benefits Bonus

Employees

(1)

23% 31% 1% (13%) (21%) 8%

Executive Directors

Mike Ashley

(2)

N/A N/A N/A N/A N/A N/A

Chris Wootton 67% 0% (100%) 70% 0% 100%

Non-Executive Directors

David Daly 50% N/A N/A 0% (100%) (100%)

Nicola Frampton 30% N/A N/A 0% 0% N/A

David Brayshaw 30% N/A N/A 0% (100%) N/A

Richard Bottomley 30% N/A N/A 0% (100%) N/A

Cally Price 0% N/A N/A 50% N/A N/A

(1) Employees is been based on total number of employees, the decreased between FY20 and FY21 is due to the impact of Covid-19.

(2) Mike Ashley receives no remuneration.

Disclosure for all Directors in addition to the CEO has

been added this year in line with the new requirements

under the EU Shareholder Rights Directive II and over

time a five-year comparison will be built up. Frasers

Group Plc does not have any employees and therefore a

subset of the Group’s employees has been used.

The table above shows how the percentage increase/

decrease in each Director’s salary/fees, taxable benefits

and annual incentive plan between 2021 and 2022

compares with the average percentage increase in

each of those components of pay for the UK-based

employees of the Group as a whole.

Relative Importance of Spend on Pay

The table below sets out the Group’s distributions to

shareholders by way of dividends and share buybacks,

investment (calculated as set out below) and total

Group-wide expenditure on pay for all colleagues (as

reported in the audited financial statements for FY22

and FY21) and the Company’s share price (calculated

as at the close of business on the last day of FY22

and FY21). We have included information on both

investment in the business in the year and share price

performance. These are indicative of actual shareholder

value being generated and the continuing steps being

taken to position the business for future generation of

shareholder value.

FY22 FY21

Percentage

Change

Distributions to

shareholders by

way of dividends

and share

buybacks

£193,200,000 - 100%

Investment* £504,200,000 £231,200,000 79.1%

Group-wide

expenditure on pay

for all employees

£532,900,000 £377,100,000 41.3%

Share price

(pence)**

690.0 515.5 33.9%

* Comprises of increases in working capital, acquisitions and capital expenditure in the

year (see Consolidated Cash Flow Statement and note 33: Cash inflow from operating

activities) as the Board believes these to be the most relevant measures of the Group’s

investment in future growth. FY21 has been restated as per note 33.

** for these purposes, the share price for FY22 and the share price for FY21 are calculated

at the close of business on 22 April 2022 and 23 April 2021 respectively, being the last

working days prior to the period ends.

FRASERS GROUP PLC ANNUAL REPORT 2022

Remuneration Committee

During FY22, the Remuneration Committee consisted

of David Brayshaw and Nicola Frampton, who are

considered independent and the Chair of the Board,

David Daly. The purpose of the Committee, as previously

outlined, is to assist the Board to ensure that Executive

Directors and senior executives receive appropriate

levels of pay and benefits.

Attendance at the meetings held during the year is

detailed on page 71.

The members of the Committee have no personal

financial interest, other than as shareholders, in the

matters to be decided, no actual or potential conflicts

of interest arising from other Directorships and no

day-to-day operational responsibility within

the Company.

Advisers to the Committee

Mike Ashley, the Chief Executive, and Chris Wootton,

the Chief Financial Officer, have advised or materially

assisted the Committee throughout FY22 when

requested. Executive Directors are not present during,

nor do they take part in, discussions in respect of matters

relating directly to their own remuneration.

FIT Remuneration Consultants LLP (‘FIT’) act as adviser

to the Committee. FIT is a founder member of the

Remuneration Consultants’ Group and adhere to its

code of conduct. Fees totalling £75,889 plus VAT have

been paid for its services during the year (FY21: £127,184

plus VAT) for the provision of advice to the Committee

on various aspects of remuneration including advice

on the Remuneration Policy and implementation of

incentive schemes. The Committee has reviewed the

quality of the advice provided and whether it properly

addressed the issues under consideration and is satisfied

that the advice received during the year was objective

and independent. FIT has no personal connection to the

Company or its Directors.

Total Remuneration

The Committee considers that the current remuneration

arrangements promote the long-term success of the

Company within an appropriate risk framework and are

suitably aligned to the Company’s objective of delivering

long term sustainable growth in total shareholder returns

given bonuses are discretionary.

Remuneration Principles

A key priority is to ensure that our Remuneration Policy

is aligned with strategy to achieve the long-term

success of the Group. The Committee ensures that

it complies with the requirements of regulatory and

governance bodies including, but not limited to, the UK

Corporate Governance Code, whilst meeting stakeholder,

shareholder and workforce expectations.

The Remuneration Committee and Board remain

committed to a fully transparent and simple

Remuneration Policy that is aligned with the interests

of all its shareholders. In the operations of the

Remuneration Committee, we reiterate our commitment

to the following key principles:

• Clarity: We provide open and transparent

disclosures regarding our executive remuneration.

• Simplicity: Our Remuneration Policy for our

Executive Directors is straightforward and

understood by both Directors and shareholders.

• Predictability: Most components of Director

remuneration are either fixed or subject to individual

caps set by reference to base salary. Through the

use of a share price measure under the Executive

Share Scheme, performance outcomes are

predictable and highly aligned to the experience of

our shareholders.

• Proportionality: Our Executive Director salaries are

amongst the lowest in the FTSE 250. Variable pay

awards are ‘at-risk’ and linked to delivery of our

strategy and long-term performance, to ensure that

poor performance is not rewarded.

• Risks and behaviours: We ensure that in our

operations we identify and mitigate reputational

risks arising from our remuneration arrangements

and behavioural risks related to incentive targets.

• Alignment to culture: Increases to pay and

bonuses are only awarded where the Executive

Director demonstrates high-level behaviours and

performance consistent with Company purpose,

values and strategy.

Responsibilities of the Committee

The Committee is responsible for:

• determining the Company’s policy on Executive

Director’s remuneration, including the design of

bonus schemes and targets, share schemes when

appropriate, together with payments under them;

• determining the level of remuneration of the Chair

and each of the Executive Directors;

• setting the remuneration for the first layer of

management below the Board level, including the

Company Secretary;

• monitoring the remuneration of senior management

and making recommendations in that respect;

• agreeing any compensation for loss of office of any

Executive Director; and

• ensuring that the Company’s Remuneration Policy

remains fit for purpose and takes note of any new

regulatory requirements.

FRASERS GROUP PLC ANNUAL REPORT 2022

What Has the Committee Done

During the Year?

• Put in place an Executive Share Scheme for the

CEO, CFO, COO (‘Chief Operating Officer’) and

CCO (‘Chief Commercial Officer’). This was voted on

by shareholders at the 2021 AGM and will reward

executives based on a stretching share price target

of £12 for all executives apart from the CEO and a

share price target of £15 for the CEO.

• Worked with senior leaders in the business to

explore long service awards for colleagues with five,

ten, and twenty years’ service.

• Reviewed the Fearless 1000 share scheme to spread

points more evenly around the business. Regional

managers now have 1,000 points (the same as

senior leaders) as they have a large amount of the

workforce reporting to them. The Committee is

satisfied that the points distribution in the Fearless

1000 is fairly split between head office, retail

and warehouse.

• Worked with HR to introduce exit interviews to

establish colleagues’ reasons for departure.

The Remuneration Committee meets several times a

year, with four formal meetings and a number of ad hoc

meetings held in FY22.

During the year, the Committee considered its

obligations under the UK Corporate Governance Code

and concluded that:

• the Directors’ Remuneration Policy supports the

Company’s strategy (including in the performance

measures chosen), considers other external

remuneration guidance/benchmarked against other

FTSE companies and pay ratios and worked as

intended in FY22; and

• taking into consideration Company performance

during FY22, remuneration for our Directors

remains appropriate.

Shareholder Voting

The following table sets out actual voting in respect of the resolution to approve the Directors’ Remuneration Report

for the period ended 25 April 2021 at the 2021 AGM and the resolution to approve the Directors’ Remuneration Policy

at the 2021 AGM.

Votes for % for

Votes

against

% against Total votes cast

Votes

withheld

Directors’ Remuneration Report for the period

ended 25 April 2021

391,676,959 86.27 62,315,356 13.73 453,992,315 14,649

Directors’ Remuneration Policy 385,510,465 84.92 68,480,849 15.08 453,991,314 15,650

David Brayshaw

Chair of the Remuneration Committee

on Behalf of the Board

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

AUDIT COMMITTEE REPORT

Dear Shareholder

I am pleased to present the report of the Audit

Committee (the Committee) for the 52-week period

ended 24 April 2022. The report sets out the Committee’s

work and areas of focus during the year, which has

continued to have the shadow of uncertainty cast by

Covid-19 and the emergence of new variants along with

supply chain risks and well-publicised macroeconomic

factors. The Committee has therefore focused on and

discussed the Group’s performance, and the impacts of,

and response to these external factors. Our performance

as a business has remained strong in these challenging

circumstances. It has been impressive to see the

continued strength and depth of experience across all

our business teams and their ability to withstand and

manage the significant risks that materialised.

We monitored the Group’s ongoing viability and going

concern positions, reviewing cashflow forecasts and

scenario modelling. We have kept the Group risk

profile and emerging risks under continued review and

had clear oversight of the activities of the executive

Compliance & Risk Group. We have also monitored the

Group’s response to opportunities and acquisitions, to

ensure we come through the period stronger and on

track to meet our strategic targets.

On behalf of the Board, the Committee monitors the

Group’s financial reporting processes and the integrity

of its financial statements and ensures high standards

of quality and effectiveness in the external audit

process. The Committee also reviews and monitors the

effectiveness of the Group’s systems of risk management

and internal control, governance and compliance.

We have built a strong and productive working

relationship with RSM UK Audit LLP (‘RSM’) since its

appointment in 2019 as our External Auditor and we

value the integrity, strength and depth of its audit

and approach.

We have continued to make strong progress against

our continuous improvement assurance agenda across

governance, risk and control. We have closely monitored

the Government’s audit and governance reform agenda

and await their response to this.

The Committee values the ongoing work of the Group’s

Internal Audit and Risk Team, Retail Support Unit and

Digital Risk teams and continues to seek assurance that

their work remains a strength in our Group.

Taking its responsibilities as a whole, the Committee is

satisfied that the going concern basis of accounting is

appropriate (see further detail at page 99) and that the

Group is viable over its assessment period (see page 63).

I would like to take the opportunity to thank all our

colleagues for their valuable commitment, contributions

and support towards our Group performance.

Membership

During the year, the Audit Committee comprised three

Non-Executive Directors, David Brayshaw, Nicola

Frampton and myself as Chair. Biographies of each

Committee member are set out in the Directors’ profiles

on pages 72 to 74 of this Annual Report.

As Chair of the Audit Committee and Senior

Independent Non-executive Director, I am satisfied

that the Committee’s membership includes Directors

with recent and relevant financial experience and

competence in accounting, risk management and

governance, and that the Committee as a whole has

competence relevant to the retail sector in which the

Group operates.

Meetings

The Committee met five times during the year, as

we have extended our agenda to accommodate our

assurance requirements. Non-Committee members

of the Board and the executive management team

attended Committee meetings at my invitation to

ensure the Committee is kept informed of important

developments in the business and the risk and control

environment. Attendance by members of the executive

management team also helps to reinforce a strong

culture of risk management within the business.

Non-Committee members do not participate in Audit

Committee decision making.

Our External Auditor attended all Committee meetings

during the year. The Committee meets privately with

the External Auditor at least annually. In my capacity as

Chair, I have regular meetings with the External Auditor

prior to each Committee meeting during the audit

planning process and as the audit progresses, to address

issues early and to avoid any surprises. I am also in

continuous contact with the Board Chair, Chief Executive,

Chief Financial Officer, External Audit Lead Partner and

our Head of Internal Audit & Risk Management, who has

an independent reporting line to me.

FRASERS GROUP PLC ANNUAL REPORT 2022

The Main Responsibilities of the

Audit Committee

The Committee’s main responsibilities, as delegated by

the Board, remained unchanged during the year and

are set out in the Committee’s Terms of Reference. These

include oversight, assessment and review of:

Financial Statements and Reporting:

• the integrity of the Group’s financial reporting as a

whole and any formal announcements relating to

the Group’s financial performance, including any

significant judgements contained in them; and

• the Group’s assessment of its going concern and

longer-term prospects and viability.

External Auditor

• the effectiveness of the external audit process

taking into consideration relevant UK professional

and regulatory requirements;

• developing and implementing policy on the supply

of non-audit services by the External Auditor and

approving any such work; and

• reviewing and monitoring the External Auditors’

independence and objectivity.

Risk Management and Internal Controls

• the effectiveness of the Group’s internal financial

controls, risk management and internal control

systems, including the monitoring and reviewing

the effectiveness of activities of the Internal Audit

function, and driving an agenda of continuous

improvement;

• identifying and assessing principal and emerging

risks and risk exposures; and

• the effectiveness of whistleblowing arrangements.

In addition, the Committee:

• supports the Board in discharging its responsibilities

for Corporate Governance Code compliance;

• advises the Board on the outcome of the external

audit and whether it considers the Annual Report

and Accounts, when taken as a whole, are fair,

balanced and understandable and provide

information necessary to shareholders to assess the

Group’s position and performance, business model

and strategy;

• makes recommendations to the Board on the

appointment, reappointment or removal of the

External Auditor;

• approves the External Auditor’s fees and terms

of engagement;

• maintains strong relationships with the Board,

executive management, the External Auditor and

Internal Audit, in the execution of their respective

responsibilities; and

• reports to the Board on how the Committee has

discharged its responsibilities during the year.

Activities During the Period

The Committee focused on a number of significant areas

of internal control (including financial, operational and

compliance controls). During the period, the Committee:

• reviewed the Group’s financial statements and

assessed whether suitable accounting policies have

been adopted and whether management has made

appropriate estimates and judgements;

• reviewed the detailed scenarios and assumptions

behind the going concern basis of accounting and

enhanced viability, including the worst

case scenario;

• assessed the effectiveness of the external audit

process and considered the reappointment of RSM

as the External Auditor for FY23;

• monitored the effectiveness of the Group’s risk

management and internal control systems and

received detailed reports and presentations on

principal risks management;

• received regular updates on ESG matters, including

TCFD requirements, climate-related risks

and opportunities;

• reviewed its Terms of Reference; and

• together with the Board, considered the

Committee’s own effectiveness.

FRASERS GROUP PLC ANNUAL REPORT 2022

Risk Management and Internal Controls

Information on our approach to risk management

and internal control is set out in the risk section of the

Strategic Report and the conclusion of our review is set

out on page 51. Our plans for continuous improvement

of our risk management and internal control systems

remained in place during the year and our Group

Internal Audit & Risk Management function has

reinforced our progress. The work of our Retail Support

Unit is central to the Group’s system of internal control.

The Unit provides internal assurance on the efficacy of

controls over our retail operational procedures

and systems.

In the year, the Committee focused on a number of

significant areas of internal control, including:

• climate risk and the Group’s environmental, social

and governance agenda, supporting Taskforce for

Climate-related Financial Disclosures reporting.

Further details can be found on page 40;

• key legislative and regulatory obligations, including

data protection and oversight of Government plans

for audit and governance reform - strengthening

controls over financial reporting;

• cyber risk and data loss prevention, including

strengthening of our information security capability;

• the enhancements made to IT general controls

(‘ITGC’), including a review of a critical business

database’s access to ensure that it was

proportionate to the needs of the business as well as

meeting the robust security standards required of a

critical database. The process is now being scaled

and aligned across all key systems to ensure access

is appropriate;

• updates on the governance policies review

and reporting;

• reviewing significant accounting judgements

and estimates;

• the valuation of assets and stock and the

calculation of associated provisions;

• the effectiveness of hedge accounting and the

management of foreign currency exposures;

• property and the systems in place to ensure

impairments are recognised on a timely basis;

• reviewing and communicating the Group’s

Whistleblowing policy, ensuring concerns can be

raised via telephone, via email to a dedicated

whistleblowing address or directly to the Company

Secretary or CFO;

• HR review of control processes for managing

starters, movers and leavers;

• business continuity, IT disaster recovery and incident

response; and

• the Group’s banking arrangements.

Audit Quality

The Committee received comprehensive updates from

RSM and the business in response to outlined reform

proposals in the current Government consultation:

restoring trust in audit and corporate governance.

Building on the three significant reviews in the last

couple of years -the Competition and Markets Authority

(CMA) Market Study, the Kingman Review and the

Brydon Review - the UK audit sector, the audit profession,

audit regulation, and the quality of the audit product,

have never been under greater scrutiny.

The Committee will continue to oversee the development

of plans for compliance readiness in response to the

current BEIS consultation and we look forward to

Government’s decision in due course. The Group has

responded to the Government consultation.

FRASERS GROUP PLC ANNUAL REPORT 2022

External Auditor

The Committee was pleased to recommend the

reappointment of RSM as External Auditor for FY22

following a robust external audit review of FY21. The

length of tenure of RSM as external auditors is

three years.

RSM has reported to the Committee that, in its

professional judgement, it is independent within the

meaning of regulatory and professional requirements

and the objectivity of the audit engagement partner

and audit staff is not impaired. The Audit Committee

has assessed the independence of the auditor and

concurs with this statement.

The Committee evaluates the effectiveness of the

external audit process on an ongoing basis and makes

recommendations annually to the Board on the External

Auditor’s reappointment. The External Auditor is then

proposed for reappointment (as applicable) each year

at the AGM.

In making its recommendations to the Board, the

Committee considers a number of factors relating to

the level of service provided by the External Auditor, the

quality of its work and its independence. These include:

• the quality and scope of the planning of the external

audit, including the External Auditor’s assessment of

risks and how it intends to evolve the audit plan to

respond to changes in the business;

• the quality and timeliness of the External Auditor’s

reports to the Committee and the Board during

the year;

• the level of understanding that the External Auditor

has demonstrated in relation to the Group’s

businesses and the retail sector;

• the objectivity of the External Auditor’s view on any

deficiencies in internal control which came to its

attention during the course of its audit work, and the

robustness of challenge and its findings on areas

which require management judgement;

• the contents of any external reports or regulatory

statements published in respect of the External

Auditor; and

• the nature and scope of non-audit services provided

by the External Auditor and the level of fees charged

for these services.

We have a stringent policy and approval process in

place in respect of non-audit services and our view

is to keep this type of engagement minimal unless in

exceptional but reasonable circumstances, and in line

with Group policy. No non-audit services have been

provided by the External Auditor in the financial year

(other than agreed upon procedures in relation to the

interim financial statements).

Opinion on the Annual Report

and Accounts

The Board has asked the Committee to advise it on

whether the Annual Report and Accounts, taken as

a whole, are fair, balanced and understandable and

provide the information necessary for shareholders

to assess the Group’s position, performance, business

model and strategy.

The Committee has reviewed the process for

preparing this Annual Report in order to assess

whether other information contained in it is

consistent with the Group’s financial statements for

the 52 weeks ended 24 April 2022. This process has

included the following key elements:

• reviewing new regulations and reporting

requirements with external advisers to identify

additional information and disclosures that may

be appropriate;

• preparing a detailed timetable and allocation of

drafting responsibility to relevant internal teams with

review by an appropriate senior manager;

• providing an explanation of the requirement for the

Annual Report and Accounts, taken as a whole, to

be fair, balanced and understandable, to those with

drafting responsibility;

• monitoring the integrity of the financial statements

and other information provided to shareholders

to ensure they represent a clear and accurate

assessment of the Group’s financial position

and performance;

• reviewing significant financial reporting issues and

judgements contained in the financial statements;

• review of all sections of the Annual Report by

relevant external advisers;

• review by the senior manager working group

responsible for the Annual Report process; and

• overall review of the contents of the Annual Report

and Financial Statements for the period under review.

The Committee has advised the Board that it considers

the Annual Report and Financial Statements for the

period ended 24 April 2022, when taken as a whole, to

be fair, balanced and understandable and that they

provide the necessary information to assess the Group’s

position, performance, business model and strategy.

FRASERS GROUP PLC ANNUAL REPORT 2022

Significant Financial Reporting Issues

The Committee has considered the following areas of significance during the period and held discussions with

management and the External Auditor in reviewing these matters. The Committee is satisfied with how each of these

matters has been discussed and addressed.

Going concern and viability The Audit Committee has held extensive talks with management on going concern and viability, and the Committee as a

whole has reviewed and challenged management analysis and assumptions used in both these assessments. This includes

reviewing cash flow forecasts, sensitivity analysis, finance facilities and future funding plans. We considered areas of ongoing

uncertainty in respect of Brexit, supply chain issues, cost of living and the broader economic downturn.

The Group has successfully refinanced a combined term loan and revolving credit facility (RCF) which currently totals £980m

for a period of three years with the possibility to extend for a further 2 years.

On this basis, the Committee is satisfied that the going concern basis of accounting is appropriate and the Group is viable

over its assessment period. Further information is included within the Viability Statement and the Directors’ Report.

Inventory The Committee has considered the work performed on inventory valuation and provisioning and has reviewed

management’s methodology.

The Committee is satisfied the approach is consistent with the prior periods and takes account of any related supply chain

and macroeconomic risks.

The Committee is satisfied with the approach taken on inventory valuation and provisioning for Studio Retail, due to the

specific risks associated with inventory within that business.

Impairment of right-of-use

assets; property, plant

& equipment; freehold

property and related

property provisions

The Committee reviewed and challenged management’s impairment testing, including the key assumptions and

methodologies used. The projected cash flows, discount rates and third-party valuations used in the evaluation were

considered appropriate, within the context of the changes in consumer behaviour and economic uncertainties.

Forward currency contracts The Committee reviewed and discussed with management the valuation methodology used and accounting treatment

applied to derivative contracts. The Committee also review delegated authorities in place for the execution of such

transactions and is satisfied these are appropriate.

Accounting for investments

and associates

Investments: the Committee considered management’s work on presentation and classification risk, in respect of investment

shareholdings in excess of 20%. This work involves management judgement on whether or not the Group has significant

influence over these entities. The Committee discussed with management and reviewed its representations in determining

significant influence.

Associates: the Committee also considered management’s work on presentation and classification risk in relation to

associates. The Committee has similarly discussed with management and reviewed its representations in determining

whether the Group has control over its associates.

Related parties The Committee has evaluated the appropriateness of related-party disclosures through discussions with management and

review of papers outlining the valuation of the loan to Four Holdings Limited and the FY22 payments in respect of MM Prop

Consultancy Limited and M.P.M Elevation Limited. The Committee is satisfied that the disclosures, payment and approach

are appropriate.

Legal and other provisions

and accruals

The Committee has reviewed and discussed with management its judgements and determinations in respect of legal

provisioning and accrual for tax-related matters at the period end. Given the inherent levels of uncertainty and estimation in

these areas, the Committee has carefully considered and challenged management’s conclusions and reviewed independent

third-party reports where available. As a result, the Committee is satisfied that the valuation of amounts recognised within

legal and other provisions are appropriate.

Impairment allowance on

trade receivables (Studio

Retail Ltd)

The Committee challenged managements judgements and estimates on provisioning levels. The Committee is satisfied the

underlying approach is consistent with Studio Retail’s prior periods and has been adequately updated to take into account

related supply chain and macroeconomic risks. Furthermore, the committee is satisfied with the approach for the post model

economic overlay.

Business combination

accounting

The Committee reviewed the work performed by management in respect of the acquisition of Studio Retail Limited,

specifically, in relation to the valuation of net assets at the date of acquisition, accounting for the defined benefit pension

scheme, fair value of intangibles and the fair value of the credit purchased impaired assets. The Committee is satisfied

that the acquisition and presentation of Studio Retail Limited represents a true and fair view and that the date of control,

estimates and judgements used by management are appropriate.

FRASERS GROUP PLC ANNUAL REPORT 2022

Review of the Committee’s Effectiveness

The Committee has improved its governance and annual

planning cycle in the year and will continue to build on

this in FY23. I monitor and assess the effectiveness of

the Committee regularly as Chair and invite input from

the External Auditor on this.

Key Objectives for FY23

The Committee’s key objectives for FY23 are to:

• oversee the development of plans in response to the

Government’s reform proposals: restoring trust in

audit and corporate governance;

• monitor continuous improvement of the Group’s

systems of risk management and internal control;

• maintain a strong relationship with our External

Auditor and engagement on the delivery of a robust,

efficient and effective external audit; and

• strengthen assurance activity across the Group

based on the three lines model, (accountability,

actions, assurance).

Richard Bottomley

Chair of the Audit Committee and Senior Independent

Non-Executive Director

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

DIRECTORS’ REPORT

The Directors of Frasers Group Plc present their Annual

Report and Accounts for the period ended 24 April 2022.

The Group’s Corporate Governance Statement is set out

on page 65 and forms part of the Directors’ Report.

Principal Activities and Business Review

The Chief Executive’s Report and Business Review on

page 18 provides a detailed review of the Group’s

current activities and potential future developments,

together with matters likely to affect future development,

performance and conditions. Principal risks and

uncertainties likely to affect the Group are set out on

page 50. The financial position of the Group, its cash

flow, liquidity position and borrowing facilities are

described in the Financial Review on page 28. The

Strategic Report on page 10 covers environmental

matters, including the impact of the Group’s businesses

on the environment, the Group’s workforce, and on

community engagement.

The principal activities of the Group during the

period were:

• retailing of sports and leisure clothing, footwear and

equipment, premium and luxury apparel;

• retailing through department stores, shops

and online;

• wholesale distribution and sale of sports and leisure

clothing, footwear and equipment, premium and

luxury apparel;

• production of apparel under Group-owned or

licensed brands; and

• licensing of Group Brands.

Frasers Group Plc, through various subsidiaries, has

established branches in a number of different countries

in which the business operates.

Further information on the Group’s principal activities

is set out at the front of this report and in the Chief

Executive’s Report and Business Review on page 18.

Results for the Period and Dividends

Revenue for the 52 weeks ended 24 April 2022 was

£4,805.3m and profit before tax was £335.6m compared

with £3,625.3m and £8.5m in the prior period. The

trading results for the period and the Group’s financial

position as at the end of the year are shown in the

attached financial statements and discussed further in

the Chief Executive’s Report and Business Review and in

the Financial Review on pages 18 and 28 respectively.

The Board has decided not to propose a dividend in

relation to FY22 (FY21: nil). The Board remains of the

opinion that it is in the best interests of the Group and its

shareholders to preserve financial flexibility, facilitating

future investments and other growth opportunities.

Share Capital and Control

As at 20 September 2022, there are 640,602,369 ordinary

shares of 10p in issue and fully paid, of which 163,124,612

were held in treasury. As at the period end there were

151,240,174 ordinary shares held in treasury.

Further information regarding the Group’s issued share

capital can be found in note 25. Details of our share

schemes are also set out in note 25.

There are no specific restrictions on the transfer of shares,

which are governed both by the general provisions of

the Articles of Association and prevailing legislation.

The Directors are not aware of any agreements between

holders of the Company’s shares that may result in

restrictions on the transfer of securities or on voting rights.

Authority to Issue Shares

The Directors were authorised to allot shares in the

capital of the Group up to an aggregate nominal

amount of £17,068,843 (being approx. one third of the

then issued share capital) for the period expiring at the

end of the 2022 AGM.

In line with guidance from the Association of British

Insurers, the Company was also granted authority to

issue a further third of the issued share capital to a total

nominal amount of £34,137,686, in connection with a

rights issue.

An authority to allot shares up to a maximum nominal

value of £2,560,326 (being approx. 5% of the then issued

share capital) as if statutory pre-emption rights did not

apply, was also approved. In addition, the Directors were

granted a further authority to allot up to a maximum

nominal value of £2,560,326 (being approx. 5% of the

then issued capital) as if statutory pre-emption rights

did not apply when such allotment was for the purposes

of financing (or refinancing, if the power is used within

six months of the original transaction) a transaction

which the Board determined to be an acquisition or

other capital investment of a kind contemplated by

the Pre-emption Group’s Statement of Principles on

disapplying pre-emption rights.

FRASERS GROUP PLC ANNUAL REPORT 2022

The Group was authorised to make market purchase of

ordinary shares of 10p each in the Company of up to a

maximum aggregate number of 76,758,587, representing

14.99% of the Company’s issued ordinary share capital

at the 2021 AGM. The above authority expires at the

close of the next AGM of the Company.

Whilst authorities expire at the close of the next AGM

of the Company, a contract to allot shares under these

authorities may be made prior to the expiry of the

authority and concluded in whole or part after the AGM,

and at that meeting other authorities will be sought

from shareholders.

Share Buybacks

During the period to 24 April 2022 the Company

purchased 29,979,999 under the Share buyback

programmes that commenced on 4 May 2021, 6 August

2021, 4 October 2021, 13 December 2021 and 1 April 2022.

The nominal value of the shares purchased was 10p for a

consideration of £193.2m. Up to 20 September 2022 the

Company has purchased 11,884,438 additional shares

with a nominal value of 10p for consideration of £79.9m.

No shares have been disposed of by the Company to

this date. The purpose of the Programme is to reduce

the share capital of the Company.

Shareholders

No shareholder enjoys any special control rights, and,

except as set out below, there are no restrictions in the

transfer of shares or of voting rights.

As a controlling shareholder Mike Ashley has entered

into a written and legally binding Relationship

Agreement with the Company. This agreement

ensures that the controlling shareholder complies with

the independence provisions set out in Listing Rule

6.5.4. Under the terms of the Agreement, Mike Ashley

undertook that, for so long as he is entitled to exercise,

or to control the exercise of, 15% or more of the rights

to vote at general meetings of the Company, he will:

conduct all transactions and relationships with any

member of the Group on arm’s length terms and on a

normal commercial basis; exercise his voting rights or

other rights in support of the Company being managed

in accordance with the Listing Rules and the principles

of good governance set out in the 2018 UK Corporate

Governance Code and not exercise any of his voting or

other rights and powers to procure any amendment to

the Articles of Association of the Company; and other

than through his interest in the Company, not have any

interest in any business which sells sports apparel and

equipment, subject to certain rights, after notification

to the Company, to acquire any such interest of less

than 20% of the business concerned, and certain other

limited exceptions, without receiving the prior approval

of the Non-Executive Directors; and not solicit for

employment or employ any senior employee of

the Company.

The Company has complied with this Agreement’s

independence provisions during the period and, as far as

the Company is aware, the controlling shareholder and

his associates have also complied with them.

As at 24 April 2022, the Company had been advised

that the following parties had an interest in 3% or more

of the issued share capital of the Company pursuant

to Rule 5 of the Disclosure Guidance and Transparency

Rules (‘DTR’);

Number of

shares held

Percentage

of issued

Ordinary

share capital

with voting

rights held

Nature of

holding

Mike Ashley

(1)

330,000,000 67.0% Indirect

Phoenix Asset

Management

Partners Limited

(2)

35,727,677 7.0% Direct

Odey Asset

Management LLP

(3)

28,694,940 5.3% Direct

(1) Mike Ashley held the shares through two companies, namely MASH Beta Limited

and MASH Holdings Limited, which held 303,507,460 ordinary shares (61.65% of

the issued ordinary share capital of the Company) and 26,492,540 ordinary shares

(5.38% of the issued ordinary share capital of the Company) respectively.

(2) These figures are as at 06 October 2021 being the last date on which the

Company was notified of a change in the percentage of shares.

(3) These figures are as at 14 December 2018, being the last date on which the

Company was notified of a change in the percentage of shares

Between 25 April 2022 and 20 September 2022 (being

the latest practicable date prior to the publication of

this Report) Mike Ashley’s shareholding increased to

69% held via MASH Beta Limited and MASH Holdings

Limited, which hold 303,507,460 ordinary shares (63.46%

of the issued ordinary share capital of the Company)

and 26,492,540 ordinary shares (5.54% of the issued

ordinary share capital of the Company) respectively.

There have been no other notification of changes in the

interest held by the above parties.

FRASERS GROUP PLC ANNUAL REPORT 2022

ADR Programmes

We are aware of unsponsored American Depository

Receipt (ADR) programmes established from time to

time in respect of our shares. We have not sponsored or

authorised their creation and any questions should be

directed to the relevant depository.

Frasers Group has not and does not intend to offer or

sell its ordinary shares or other securities (in the form

of ADR or otherwise) to the general public in the United

States nor has it listed or intend to list its Ordinary

Shares or other securities on any national securities

exchange in the United States or to encourage the

trading of its Ordinary Shares on any over-the-counter

market located in the United States. The Group does

not make arrangements to permit the voting of ordinary

shares held in the form of ADRs and its publication of

periodic financial and other information is not intended

to facilitate the operation of any unsponsored ADR

programme under Rule 12g 3-2(b) of U.S. Securities

Exchange Act of 1934, as amended or otherwise.

Articles of Association

The Company’s Articles of Association may only be

amended by special resolution at a general meeting of

shareholders. The articles were last amended at the 2021

AGM. Subject to applicable laws and the Company’s

Articles of Association, the Directors may exercise all

powers of the Company.

Takeovers

The Directors do not believe that there are any

significant contracts that may change in the event of a

successful takeover of the Company.

Share Schemes

Details of the Executive share scheme are set out in

the Directors’ Remuneration Report on page 77. The

Fearless 1000 share scheme remains in place and is due

to benefit colleagues in 2025, should the parameters of

that scheme be met.

Colleague Involvement

The Group currently has approx. 30,000 colleagues in its

stores, offices and warehouses.

The workforce is notified of announcements and major

changes in the business via Company emails, SLACK,

social media and our intranet, as well as information

being communicated through line managers. The

Company has elected a Workers’ Representative, Cally

Price, who attends all Board meetings and provides

feedback from employees to the Board. The Company

also has the ‘Your Company, Your Voice’ scheme

which enables colleagues to raise issues of concern

via suggestion boxes. The contributions are read by

senior management and the Workers’ Representative,

who provides the Board with an overview and replies

to colleagues as appropriate. A selection of questions

received, and answers given by management, are

displayed in communal areas for colleagues.

The Group has invested heavily in a new e-learning

platform that provides colleagues with access to

courses and opportunities to keep up to date with the

latest developments of the Group as well as personal

development opportunities. Our new Leadership

Academy also invests in colleagues who wish to

grow within the business and provides them with the

opportunity to shape the polices and future direction of

the business.

Our retail conferences offer attendees an opportunity

to celebrate their successes, receive updates on how

the Group’s strategy is progressing, and for them to

judge how the Group is performing via the ‘Confident or

Concerned’ questionnaire.

Our monthly nominations for ‘Frasers Champion’

provides colleagues with the opportunity to individually

recognise and reward the hard work of their fellow

colleagues. Winners of the monthly champion awards

win an additional month’s salary as well as 10 points

under the Fearless 1000 bonus scheme. A total of 98

colleagues were ‘Frasers Champions’ in the year.

There are various colleague incentives available to

our retail colleagues. These incentives include our 5

Star Commission Scheme, Turnover Bonus, PBT Bonus,

Stocktake Bonus and other commission schemes. These

schemes vary between fascias.

Further information on relationships with our people and

the principal decisions taken by the Group during the

period having regard to colleague involvement can be

found in the Directors’ Report on page 97 and page 13 of

the Our People section.

Diversity and Equal Opportunities

The Group’s recruitment policy is to match the

capabilities and talents of each applicant to the

appropriate job. Factors such as gender, race, religion or

belief, sexual orientation, age, disability or ethnic origin

are ignored, and decisions are made with regard to

candidates irrespective of these factors. Discrimination

in any form is not tolerated within the Group.

Applications for employment by persons with any

disability are given full and fair consideration for all

vacancies and are assessed in accordance with their

particular skills and abilities.

The Group endeavours to meet its responsibilities

towards the training and employment of disabled

people, and to ensure that training, career development

and promotion opportunities are available to all.

The Group makes every effort to provide continuity

of employment when our people become disabled.

Attempts are made in every circumstance to provide

FRASERS GROUP PLC ANNUAL REPORT 2022

employment, whether this involves adapting the current

job role and remaining in the same job, or moving

to a more appropriate role. Job retraining and job

adaptation are just two examples of how the Group

works in the interests of its workforce to promote equal

opportunities, in order that an individual’s employment

within the Group may continue. The Group values the

knowledge and expertise that our people have gained

throughout their time with us, and therefore does not

wish to lose valued colleagues.

Further information on our approach to diversity can be

found in the Strategic Report on page 34.

Business Relationships

Details of our relationships with business partners are

detailed in our S.172 statement, within the

Strategic Report.

Research and Development

The Group designs some clothing and footwear for our

in-house brands for sale in stores. The Group is currently

investing in research that will enable us to produce more

sustainable products and processes that will help us

meet our ESG targets.

External brands are purchased from third-party suppliers,

although we do work with them to agree on the specific

pieces which we sell in-store.

Charitable and Political Donations

During the year, the Group made charitable donations

of £6.6k (2021: £3k) in the UK. The Group also made

donations in kind such as clothing, sleeping bags and

sports equipment to various organisations and charities.

No political donations were made (2021: nil). Further

information on our charitable donations and community

initiatives can be found in our ESG report.

Directors

Details of current Directors, dates of appointment,

their roles, responsibilities and significant external

commitments are set out on page 72. The membership

of the Board of Directors has largely remained the

same throughout FY22 with the exception that Anouska

Kapour who was appointed on 29 September 2021,

subsequently resigned on 21 December 2021 due to

a conflict that arose during her tenure, and Michael

Murray was appointed to the Board on 1 May 2022.

Although the Company’s Articles of Association require

retirement by rotation of one third of Directors each

year, the Group complies with the 2018 UK Corporate

Governance Code and at each AGM all of the Directors

will retire and stand for reappointment.

Information on service contracts and details of the

interests of the Directors and their persons closely

associated in the share capital of the Company at 24

April 2022, and at the date of this Report, are shown in

the Directors’ Remuneration Report on page 77.

Copies of the service contracts of Executive Directors

and of the appointment letters of the Chair and

Non-Executive Directors are available for inspection at

the Company’s registered office during normal business

hours and at the AGM.

No Director has a directorship in common or other

significant links with any other Director.

Director appointments are governed by the Companies

Act 2006, the 2018 UK Corporate Governance Code and

the Group’s Articles of Association.

The Directors confirm that:

• so far as each Director is aware, there is no relevant

audit information of which the Company’s auditor is

unaware; and

• the Directors have taken all steps that they ought

to have taken to make themselves aware of any

relevant audit information and to establish that the

auditor is aware of that information.

Directors’ Conflicts of Interest

The Board has formal procedures to deal with Directors’

conflicts of interest. The appointment letters of

Non-Executive Directors state that they agree to consult

with the Chair prior to accepting any directorships

in publicly quoted companies or any major external

appointments. Also, if any Non-executive Director

becomes aware of any potential conflict of interest, the

Chair and Company Secretary must be notified as soon

as possible.

During the period, the Chair and the Company Secretary

were made aware of an arising conflict of interest in

relation to Anouska Kapur as a Director. As a result of

this conflict, Anouska elected to stand down from her

role. No other conflicts or additional appointments for

other Non-Executive Directors became apparent.

The independence of Non-Executive Directors is

reviewed by the Board annually. All Directors complete

an annual questionnaire to record any potential conflicts

of interest. No conflicts were disclosed for the FY22

questionnaire.

The Company has entered into a Relationship

Agreement with Mike Ashley, whose wholly-owned

companies, MASH Holdings Limited and MASH Beta

Limited, currently hold approx. 5.54% and 61.65%

respectively of the issued share capital of the Company

(excluding treasury shares) as at 24 April 2022. This

agreement is described in the Directors’ Report on

page 95.

FRASERS GROUP PLC ANNUAL REPORT 2022

Directors’ Indemnities

The Group has qualifying third-party indemnity

provisions within the meaning given to the term by s234

and s235 of the Companies Act 2006 for the Directors.

This is in respect of any potential exposure of liability in

their capacity as a Director of the Company and of any

company within the Group. Such indemnities were in

force throughout the financial period and will remain

in force.

Sports Direct Employee Benefit Trust

We note that the Trustees of the Sports Direct Employee

Benefit Trust have waived their right to receive dividends

on the ordinary shares comprised in the trust fund. No

dividends were paid by the Company for the period

ended 24 April 2022 nor for the period ended

25 April 2021.

Disclosures Required Under UK Listing

Rule 9.8.4

The information required by Listing Rule 9.8.4 is set out in

the table below:

Applicable sub-paragraph within

LR 9.8.4

Disclosure provided

(1) Interest capitalised by the Group

N/A

(2) Publication of unaudited financial

information

N/A

(3) Requirement deleted from the

Listing Rules

(4) Details of long-term incentive

schemes only involving a Director

N/A

(5) Waiver of emoluments by

a Director

N/A

(6) Waiver of future emoluments by

a Director

N/A

(7) Non pro-rata allotments for cash

(issuer)

N/A

(8) Non pro-rata allotments for cash

(major subsidiaries)

N/A

(9) Parent participation in a placing

by a listed subsidiary

N/A

(10) Contracts of significance

N/A

(11) Provision of services by a

controlling shareholder

page 81

(12) Shareholder waivers of dividends

page 95

(13) Shareholder waivers of

future dividends

N/A

(14) Agreements with controlling

shareholders

page 96

Annual General Meeting

Details on the date, time and format of the AGM will

follow shortly after the finalisation of this Annual Report

and Accounts. Information will be easily accessible on

the Group’s website.

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.

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 November 2024 with a two-year option

to extend, 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

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 and paying down

the revolving credit facility. See the Viability Statement

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 during the pandemic to require

mitigating actions or a relaxation of covenants.

FRASERS GROUP PLC ANNUAL REPORT 2022

Furthermore, as per the outlook statement, the

Directors are confident of achieving an Adjusted

PBT of between £450m to £500m during FY23. On

this basis, the Directors continue to adopt the going

concern basis for the preparation of the Annual

Report and Financial statements.

Accountability and Audit

A statement by the External Auditor can be found on

page 102, detailing its reporting responsibilities. The

Directors fulfil their responsibilities, and these are set out

in the Directors’ Responsibilities Statement on page 101.

Auditor

RSM UK Audit LLP will be proposed for reappointment

at the AGM. In accordance with s.489(4) of the

Companies Act 2006, resolutions to determine

remuneration are to be agreed at the AGM.

Post Balance Sheet Events

See note 37 to the Financial Statements.

Future Developments

Future developments are discussed throughout the

Strategic Report.

Financial Risk Management

Financial risk management is discussed in note 3 of the

financial statements.

By Order of the Board

Robert Palmer

Company Secretary

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

100

DIRECTORS’ RESPONSIBILITY

STATEMENT

The Directors are responsible for preparing the

Strategic Report and the Directors’ Report, the

Directors’ Remuneration Report, the separate Corporate

Governance Statement and the financial statements in

accordance with applicable law and regulations.

Company law requires the Directors to prepare

Group and Company financial statements for each

financial year. The Directors have elected under

company law and are required under the Listing Rules

of the Financial Conduct Authority to prepare Group

financial statements in accordance with UK-adopted

International Accounting Standards. The Directors have

elected under company law to prepare the Company

financial statements in accordance with United

Kingdom Generally Accepted Accounting Practice

(United Kingdom Accounting Standards and

applicable law).

The Group financial statements are required by law and

UK-adopted International Accounting Standards to

present fairly the financial position and performance of

the Group; the Companies Act 2006 provides in relation

to such financial statements that references in the

relevant part of that Act to financial statements giving a

true and fair view are references to their achieving a

fair presentation.

Under company law the Directors must not approve the

financial statements unless they are satisfied that they

give a true and fair view of the state of affairs of the

Group and the Company and of the profit or loss of the

Group for that period.

In preparing each of the Group and Company financial

statements, the Directors are required to:

A. select suitable accounting policies and then apply

them consistently;

B. make judgements and accounting estimates that

are reasonable and prudent;

C. for the Group financial statements, state whether

they have been prepared in accordance with

UK-adopted International Accounting Standards;

D. for the Company financial statements, state

whether applicable UK accounting standards

have been followed, subject to any material

departures disclosed and explained in the

Company financial statements;

E. prepare the financial statements on the going

concern basis unless it is inappropriate to presume

that the Group and the Company will continue

in business.

The Directors are responsible for keeping adequate

accounting records that are sufficient to show and

explain the Group’s and the Company’s transactions

and disclose with reasonable accuracy at any time the

financial position of the Group and the Company and

enable them to ensure that the financial statements

and the Directors’ Remuneration Report comply with

the Companies Act 2006. They are also responsible for

safeguarding the assets of the Group and the Company

and hence for taking reasonable steps for the prevention

and detection of fraud and other irregularities.

Directors’ Statement Pursuant to the

Disclosure and Transparency Rules

Each of the Directors, whose names and functions are

listed on pages 72 to 74 confirm that, to the best of each

person’s knowledge:

A. the financial statements, prepared in accordance

with the applicable set of accounting standards,

give a true and fair view of the assets, liabilities,

financial position and profit of the Company and

the undertakings included in the consolidation taken

as a whole; and

B. the Strategic Report contained in the Annual

Report includes a fair review of the development

and performance of the business and the position

of the Company and the undertakings included in

the consolidation taken as a whole, together with a

description of the principal risks and uncertainties

that they face.

The Directors are responsible for the maintenance and

integrity of the corporate and financial information

included on the Company’s website.

Legislation in the United Kingdom governing the

preparation and dissemination of financial statements

may differ from legislation in other jurisdictions.

Chris Wootton

Chief Financial Officer

20 September 2022

FRASERS GROUP PLC ANNUAL REPORT 2022

101

INDEPENDENT AUDITOR’S

REPORT TO THE MEMBERS OF

FRASERS GROUP PLC

Opinion

We have audited the financial statements of Frasers

Group Plc (the ‘parent company’) and its subsidiaries

(the ‘Group’) for the period ended 24 April 2022 which

comprise the Consolidated Income Statement, the

Consolidated Statement of Comprehensive Income, the

Consolidated Balance Sheet, the Consolidated Cashflow

Statement, the Consolidated Statement of Changes

in Equity, the Company Balance Sheet, the Company

Statement of Changes in Equity and notes to the

financial statements, including a summary of significant

accounting policies. The financial reporting framework

that has been applied in the preparation of the Group

financial statements is applicable law and United

Kingdom adopted International Accounting Standards.

The financial reporting framework that has been applied

in the preparation of the parent company financial

statements is applicable law and United Kingdom

Accounting Standards including Financial Reporting

Standard 102 “The Financial Reporting Standard

applicable in the UK and Republic of Ireland” (United

Kingdom Generally Accepted Accounting Practice).

In our opinion:

• the financial statements give a true and fair view

of the state of the Group’s and of the parent

company’s affairs as at 24 April 2022 and of the

Group’s profit for the period then ended;

• the Group financial statements have been properly

prepared in accordance with United Kingdom

adopted International Accounting Standards;

• the parent company financial statements have

been properly prepared in accordance with United

Kingdom Generally Accepted Accounting Practice;

and

• the financial statements have been prepared

in accordance with the requirements of the

Companies Act 2006.

Basis for Opinion

We conducted our audit in accordance with

International Standards on Auditing (UK) (ISAs (UK)

and applicable law. Our responsibilities under those

standards are further described in the Auditor’s

responsibilities for the audit of the financial statements

section of our report. We are independent of the

Group and parent company in accordance with the

ethical requirements that are relevant to our audit

of the financial statements in the UK, including the

FRC’s Ethical Standard as applied to listed public

interest entities and we have fulfilled our other ethical

responsibilities in accordance with these requirements.

We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for

our opinion.

Our opinion is consistent with our reporting to the

Audit Committee.

Summary of Our Audit Approach

Key audit matters

Group – Recurring risks

• Valuation of inventory.

• Impairment of property

related assets.

• Property, Legal and

Other Provisions.

Group – event driven risks

• Impairment of Studio Retail

trade receivables.

• Accounting for the acquisition

of the trade and certain assets

of Studio Retail Group.

Materiality Group

• Overall materiality: £17.0million.

• Performance materiality:

£11.0million.

Parent Company

• Overall materiality: £5.4million.

• Performance materiality:

£3.5million.

Scope Our Group audit procedures

covered 83% of revenue, 86%

of total assets and 91% of profit

before tax.

FRASERS GROUP PLC ANNUAL REPORT 2022

102

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the

Group and parent company financial statements of the current period and include the most significant assessed risks

of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on

the overall audit strategy, the allocation of resources in the audit and directing the efforts of the engagement team.

These matters, and any comments we make on the results of our procedures thereon, were addressed in the context of

our audit of the Group and parent company financial statements as a whole, and in forming our opinion thereon, and

we do not provide a separate opinion on these matters. This is not a complete list of all risks identified by our audit.

Valuation of inventory

Key audit matter description At 24 April 2022, the Group Consolidated Balance Sheet records inventory of £1,277.6m (2021: £1,096.6m). This

amount is net of an inventory provision of £236.7m (2021: £219.8m).

As described in note 2 to the financial statements, management use a forward looking inventory provisioning model

which calculates a provision by category of inventory based on historical experience, pricing and discounting

strategies and management’s assessment of risk.

There is significant estimation involved in the calculation of inventory provisions to ensure that inventory is held at

the lower of cost and net realisable value. This involves consideration of expected future losses on sale of inventory

including assessing the likely impacts of macro-economic factors, inventory obsolescence and the additional costs

to sell which need to be included in calculating the net realisable value of inventory.

Due to the factors explained above, we have identified the valuation of inventory as a key audit matter.

How the matter was addressed in

the audit

In respect of inventory valuation we:

• Assessed the appropriateness of management’s inventory provision calculations, including testing the accuracy

and completeness of the data used and the mathematical accuracy of the provisioning model.

• Critically challenged the assumptions made in the inventory provision model in respect of the expected level of

discounting and the expected costs of sale, including:

• The basis on which expected discounts were calculated and whether calculated discounts were realistic

based on historical experience and the current trading environment.

• The assumptions regarding the expected volume and allocated costs of redistributing (tunnelling) and

repricing product.

• Whether different assumptions and estimates should be applied for different fascias given the

differentiated product mix.

• Considered management’s strategic options for addressing demand in the uncertain retail economic

environment resulting from current macro-economic factors, including discounting levels and further

development of on-line retail channels.

As a result of our findings from challenging management’s model, we independently developed an alternative

model that applied historic inventory loss experience to calculate a provision against current out of season and

clearance inventory and inventory that would be expected to remain unsold and fall into those categories in future

periods. In addition, we recalculated the expected future tunnelling and repricing costs to take account of our

assessment of the likely future costs of these activities in relation to products that would have a net realisable value

which was below cost.

We then formed an assessment, based on discussions with management and available market data, to reflect the

expected impact of current macro-economic factors and expected changes in customer disposable income. This

included consideration of forecast future sales performance, expected margin decline, the increased risk of inventory

becoming out of season and adjustments considered relevant for specific fascias, where the risk of inventory

obsolescence was considered to be higher. Our alternative model allowed us to develop an estimate of the level of

provision we considered appropriate and supportable against which we were able to assess management’s estimates.

Key observations Our audit work on inventory valuation, and in particular the development of our own alternative provision model, did

not identify any material misstatement in the valuation of inventory.

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Impairment of property related assets

Key audit matter description As a result of the macro-economic factors, reduction in consumer disposable income and changing patterns of retail

consumer behaviour, particularly in relation to physical stores, the Group identified that there were indications of

impairment in relation to freehold property interests, right of use assets and related PPE (“property related assets”).

As required by IAS 36 (Impairment of Assets) the Group has performed an impairment review of all such assets.

As a result of this review, impairments in relation to freehold property (£106.5m), right of use assets (£76.8m) and

related PPE (£40.7m) have been made in these financial statements.

As described in note 2 to the financial statements, the impairment review involves management judgements and

estimates in relation to the value in use of the property related assets (being the net present value of the forecast

related cashflows) and, in the case of freehold property, comparison of calculated value in use to internal and

external property valuations. The values derived are then compared to the book value of the related assets to

determine whether impairment is required. In making this assessment management determined each property or

store to be a cash generating unit (CGU).

The value in use calculations involve significant assumptions regarding future cashflows, the long term growth rate in

like for like sales, an assessment of the propensity for customers to switch to online purchases, pressure on margins

and determination of an appropriate discount rate and an assessment of the likely impact of high inflation and

reduced consumer disposable income. In the case of freehold property, valuations are dependent on assumptions

regarding the ability to relet property, the length of void and rent free periods and future rentals achievable.

Accordingly we determined that the valuation of property related assets had a high degree of estimation uncertainty.

Due to the factors explained above, we have identified valuation, presentation and disclosure of property related

assets as a key audit matter.

How the matter was addressed in

the audit

We obtained an understanding of how management performed their impairment testing of property related assets

and their approach to valuation.

We critically assessed the methodology applied by management with reference to the requirements of IAS 36 and

tested the integrity of the value in use calculations and the calculated impairments by CGU.

In the case of freehold property, in addition to assessing the value in use calculations, we evaluated the approach

to the valuation of freehold interests with input from an independent external retail property valuation expert and

critically challenged the underlying assumptions.

In particular we challenged the significant assumptions within management’s models through:-

• Evaluating management’s assumptions through consideration of historical and current trading performance and

external data points.

• Sensitised the assumptions in management’s impairment models.

• Tested the reconciliation between the cashflows used in the value in use calculations with those used to assess

going concern and viability to ensure they were consistent.

• Critically challenging whether it was appropriate to exclude properties from the impairment model and assessing

whether the reasons for exclusion were supportable – for example where specific properties were

under redevelopment.

• Challenging whether previous impairments should be reversed.

• Comparing the discount rate used with that independently calculated by our internal valuation expert.

We assessed whether the disclosures within the financial statements are consistent with IAS 36.

Key observations Our audit work in respect of the impairment of property related assets concluded that the related balances were not

materially misstated and the disclosures management have made are appropriate.

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Property, Legal and Other Provisions

Key audit matter description The Group makes provision for liabilities where it identifies there is a present obligation as a result of a past event

and where it is probable that there will be a resultant outflow of resources that can be reliably measured.

The Group has a significant provision in relation to legal and regulatory matters and property related provisions.

As detailed in note 29 to the financial statements, the Consolidated Balance Sheet includes provisions of £230.2m

(FY21: £215.8m) relating to legal and regulatory matters, £161.2m (2021: £144.1m) relating to property provisions which

principally comprise provisions for dilapidations on leasehold properties and £41.6m (2021: £nil) relating to the

financial services business of Studio Retail.

The dilapidation provision requires significant judgements to be made as to future amounts payable based on

historical experience, external advice and evolving conditions within the property sector.

Additionally, the Group faces a number of legal, tax and other commercial claims and significant judgement is

required in determining whether a provision should be recorded and for what amount.

As a result of the Group’s acquisition of Studio Retail it has recognised a provision of £41.6m in respect of a matter

which is subject to a high degree of estimation uncertainty. This is discussed further in the key audit matter dealing

with the acquisition of trade and certain assets of Studio Retail Group and in note 29 to the financial statements.

Due to the amounts involved and the significant judgements required in quantifying and assessing provisions

we have identified existence, accuracy, completeness, presentation and disclosure of property legal and other

provisions as a key audit matter.

How the matter was addressed in

the audit

Our audit work included the following:

• Considering management’s assessment in respect of provisions and assessing whether the recognition criteria of

IAS 37 – Provisions, Contingent Liabilities and Contingent assets had been met.

• Challenging the assumptions made in the dilapidation provision model in respect of the expected level of

dilapidations on a store by store basis. As a result of our findings from challenging management’s model, we

independently developed an alternative model that applied historic dilapidation costs and relevant factors

such as geography and property type as well as considering the impacts of likely future changes in the property

market. Our alternative model allowed us to develop an estimate of the level of provision we considered

appropriate and supportable against which we were able to assess management’s estimates.

• Challenging provisions and related assumptions with key management outside the finance function, including

members of the property and legal teams and obtaining corroborative evidence from third parties in relation to

material ongoing legal and tax matters.

• Auditing the movement in provisions and checking for completeness through the review of ongoing claims for

dilapidations and through circularisation of legal advisors in relation to other claims.

Key observations Our audit work in respect of Property, legal and other provisions concluded that the related balances were not

materially misstated, albeit subject to a high degree of estimation uncertainty as regards the Studio retail provision,

and the disclosures management have made are appropriate.

Impairment of Studio Retail trade receivables

Key audit matter description Frasers Group acquired Studio Retail Limited (SRL) on 24 February 2022.

SRL has significant trade receivables as a result of credit facilities which are offered to customers. These are

recovered through instalments. These trade receivables make up a significant proportion of Frasers Group’s total

assets at 24 April 2022. An appropriate allowance for expected credit losses in respect of these trade receivables is

required to be 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. 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 macroeconomic

scenarios applied to the impairment model could have a significant impact on the carrying value of these trade

receivables.

We determined that credit risk is a highly judgemental area due to the use of subjective assumptions and a high

degree of estimation uncertainty. The impairment provision relating to the Studio Retail trade receivables required

the Directors to make judgements over the ability of customers to make future repayments. Since the recoverability

of trade receivables has a high degree of estimation uncertainty, with a potential range of possible outcomes, we

consider this to be a key audit matter.

How the matter was addressed in

the audit

Our audit work in relation to the acquired trade receivables within SRL included:-

• Reviewing the work of the component auditor in assessing the design and implementation, and testing the

operating effectiveness, of the key controls in relation to the impairment and provision model and forming our

own assessment based on this review and discussions with management.

• Assessing the overall methodology against the requirements of IFRS 9.

• Reviewing the work of the component auditor in performing testing on the data within the model and verifying

this to underlying source documentation. Utilising experts to assist the audit team in assessing the validity of

the model and challenging management’s forecasting and weighting of key model drivers (macro-economic

variables) and expected future debt sale prices (ultimate recoveries).

Key observations Based on the work performed, we considered the methodologies and modelled assumptions used to value trade

receivables expected credit losses to be reasonable and in line with IFRS 9.

FRASERS GROUP PLC ANNUAL REPORT 2022

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Acquisition of the trade and certain assets (including credit impaired assets) of Studio Retail Group

Key audit matter description On 24 February 2022, the Group acquired digital retailer, Studio Retail Limited (SRL) and certain other assets of

Studio Retail Group plc (in administration) (SRG). The consideration for the transaction, which totalled £28.3m,

comprised of cash and the release of SRG from its liabilities to the lending banks under its revolving credit facilities.

The Company also agreed to act as guarantor of certain payments in respect of the SRG group pension scheme to

the satisfaction of the Trustees. Details of the acquisition are given in note 32 to the financial statements.

Judgement is applied by management in assessing the fair value of the assets and liabilities acquired in the business

combination, including any intangibles in accordance with IFRS 13: Fair Value Measurement.

Management have applied a number of key judgements and estimates in order to account for this acquisition in

both the Group and parent company financial statements in accordance with IFRS 3 Business Combinations and

FRS 102 Section 19. These include:

• Considering whether this constitutes a step acquisition on the basis of the Group’s holding in SRG

pre administration.

• Considering whether the debt purchase is a separate transaction.

• Determining the carrying value of net assets in the acquisition balance sheet of SRL, in particular relating to the

carrying value of trade receivables.

• Determining the fair values assigned to determine the separately identifiable intangibles at the acquisition date.

• Determining any other fair value adjustments required at the acquisition date and the quantum of these,

including specifically in relation to the purchase of credit impaired assets.

• Estimating the provision required at acquisition in relation to the ongoing review of probable remediation actions

required in respect of past lending and collection activities and referred to in note 29.

Due to the nature of the judgements and estimates involved and in particular the estimation uncertainty relating

to the costs of remediation, we have identified business combination and acquisition accounting together with

accounting for credit impaired assets as a key audit matter for both the accuracy and valuation assumptions.

How the matter was addressed in

the audit

Our audit work in relation to the acquisition accounting included:

• Obtaining and reviewing management’s acquisition accounting paper in relation to the acquisition of SRL

to verify that the treatment of the acquisition entries and any fair value adjustments are appropriate and in

accordance with IFRS 3 Business Combinations and FRS 102 Section 19.

• Concluding that the conditions for recognising a step acquisition were absent given that the Group’s shares in

Studio Retail plc became worthless at the date of that company’s administration.

• Checking accounting entries to purchase and other agreements and bank statements.

• Performing testing on the net assets at the acquisition date including on the expected credit loss provisions in

respect of SRL’s trade receivables.

• Critically challenging management’s judgements in relation to fair value adjustments and recognition of

separately identifiable intangible assets.

• Reviewing and challenging management assumptions and estimates applied in accounting for the Purchase of

Credit Impaired Assets (trade receivables) in accordance with IFRS 9.

• Reviewing and challenging the methodology adopted by management in determining the initial estimate of the

provision recognised under IFRS 3 in relation to potential liabilities arising from the review described in note 29 to

the financial statements.

• Inspecting financial statement disclosures in relation to the acquisition and considering in particular the

adequacy of the disclosure and sensitivities applied in relation to the recognition of provision referred to above.

Key observations We found the approach to accounting for the acquisition, including the judgements made in the recognition and

valuation of acquired assets and liabilities to be acceptable.

In relation to the provision recognised in connection with the ongoing review of probable remediation actions

required in respect of past lending and collection activity and referred to in note 29, we consider the approach

adopted by the Group in making a provisional estimate, in accordance with IFRS 3, of the quantum of provision and

the associated disclosure to be reasonable but draw attention to the high degree of estimation uncertainty with

a potential range of reasonably possible outcomes greater than our materiality for the financial statements as a

whole and possibly many multiples of that amount.

There are no key audit matters relating to the parent company.

FRASERS GROUP PLC ANNUAL REPORT 2022

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Changes to Key Audit Matters

In the prior year we reported a key audit matter in respect of the impact of the Covid 19 pandemic and going concern

in the light of the uncertainties surrounding the impact of the pandemic on the retail sector. However, due to the UK’s

recovery from the pandemic and the strong performance of the business in the post pandemic period. We have not

deemed going concern to be a key audit matter although it remains an area of focus in the audit.

We also included, in the prior year, a key audit matter regarding the classification of investments where the Group

held more than 20% but less than 50% of the voting share capital of the investee but where the Group had rebutted

the presumption that significant influence existed. Since the only remaining such investment at the period end was in

Mulberry Group plc (36.9%) which has a significant shareholder with a beneficial interest in excess of 55% of voting

share capital, we no longer consider our assessment of management’s judgements in this area to be a key audit matter.

Our Application of Materiality

When establishing our overall audit strategy, we set certain thresholds which help us to determine the nature, timing

and extent of our audit procedures. When evaluating whether the effects of misstatements, both individually and

on the financial statements as a whole, could reasonably influence the economic decisions of the users we take

into account the qualitative nature and the size of the misstatements. Based on our professional judgement, we

determined materiality for the financial statements as follows:

Group Parent company

Overall materiality £17.0 million (2021: £11.1million) £5.4million (2021: £11.0million)

Basis for determining overall materiality 5% of profit before tax (2021: 2.8% of

underlying EBITDA)

1% of total assets (capped at an allocation of

overall Group materiality)

Rationale for benchmark applied During the year the Group changed the basis

on which market guidance was given to a profit

before tax based measure (adjusted profit before

tax) rather than the underlying EBITDA measure

applied previously on the basis that a measure

which included the impact of depreciation,

amortisation and IFRS 16 was more appropriate

given the Group’s increased investment

in properties.

We applied a lower level of materiality to the audit

of components and, in accordance with ISA 320, in

relation to certain classes of transactions, account

balances and disclosures.

The Parent Company does not trade and

therefore total assets is considered to be the most

appropriate benchmark.

Performance materiality £11.0m (2021: £7.2m)

We set performance materiality at a level

lower than overall materiality for the financial

statements as a whole to reduce to an

appropriately low level the probability that,

in aggregate, uncorrected and undetected

misstatements exceed overall materiality.

The factors we considered in determining

performance materiality included; our knowledge

of the Group, the pressures within the retail sector

and the level of misstatements in prior periods.

£3.5m (2021: £7.1m)

We set performance materiality at a level

lower than overall materiality for the financial

statements as a whole to reduce to an

appropriately low level the probability that,

in aggregate, uncorrected and undetected

misstatements exceed overall materiality.

The factors we considered in determining

performance materiality included; our knowledge

of the Group, the pressures within the retail sector

and the level of misstatements in prior periods.

Basis for determining performance materiality 65% of overall materiality (2021; 65% of

overall materiality)

65% of overall materiality (2021: 65% of

overall materiality)

Reporting of misstatements to the

Audit Committee

Misstatements in excess of £0.85million and

misstatements below that threshold that, in our

view, warranted reporting on qualitative grounds.

Misstatements in excess of £0.56million and

misstatements below that threshold that, in our

view, warranted reporting on qualitative grounds.

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107

An Overview of the Scope of Our Audit

Our audit approach was based on a thorough

understanding of the Group’s business and is risk based,

and in particular included:

• Evaluation of identified components to assess the

significance of each component and to determine

the planned audit response based on a measure

of materiality. This included significance as a

percentage of the Group’s revenue, total assets and

adjusted profit before tax;

• For those components that were evaluated as

significant, or likely to include significant risks,

either a full-scope or targeted approach was taken

based on their relative materiality to the Group,

and our assessment of the audit risk. For significant

components requiring a full-scope approach, we

evaluated controls over the financial reporting

systems identified as part of our risk assessment

and addressed critical accounting matters.

Substantive testing was performed on significant

classes of transactions and balances, and other

material balances, determined during the Group

scoping exercise;

• Full scope audit procedures have been performed

on the financial statements of Frasers Group

plc, and on the financial information of the main

trading companies within the UK Retail component;

(Sportsdirect.com Retail Limited, Wareshop 2

Limited, Sports Direct International Holdings Limited,

House of Fraser Limited, The Flannels Group

Limited), and on the SDI Property component and

GAME Retail Limited.

• In relation to the significant overseas component in

Spain and the International component; comprising

Austria, Belgium, Ireland and the United States, we

engaged RSM member firms to perform full scope

component audits. Additionally, RSM member firms

attended inventory counts in a number of locations;

• In relation to Studio Retail Limited, component

auditors were engaged to perform full scope audit

procedures covering the post acquisition period.

• The Group engagement team reviewed the

work performed by the component auditors. We

determined the level of involvement we needed to

have in their audit work at those reporting units to

be able to conclude whether sufficient, appropriate

audit evidence had been obtained as a basis for our

opinion on the Group financial statements as

a whole.

• Further specific audit procedures over the Group

consolidation and areas of significant judgement

including impairment of property related assets,

leases, taxation and treasury were performed by the

Group engagement team.

The operations that were subject to full-scope audit

procedures made up 82% of consolidated revenues,

84% of total assets and 91% of profit before tax.

The operations that were subject to targeted audit

procedures made up 1% of consolidated revenues, 2% of

total assets and 0% of profit before tax; and

The remaining operations of the Group were subject

to analytical procedures over the balance sheet and

income statements of the relevant entities with a focus

on applicable risks identified above. This made up 17%

of consolidated revenues, 14% of total assets and 9% of

profit before tax.

The coverage achieved by our audit procedures was:

Full scope audits were performed for 7 components

(some of which included a number of legal entities which

were combined for group reporting purposes), targeted

audit procedures for 7 components and analytical

procedures at group level for the remaining components.

Number of

components

Revenue Total assets

Profit

before tax

Full scope

audit

7 82% 84% 91%

Targeted audit

procedures

7 1% 2% 0%

Total

14 83% 86% 91%

Analytical procedures at group level were performed for

the remaining components.

The Group team visited two component locations

in the UK and attended video conference calls and

performed remote file reviews for components in

Austria, Belgium, Ireland, Spain, the UK and the USA.

At these meetings the findings reported to the Group

team were discussed in more detail, and any further

work required by the Group team was then performed

by the component auditor.

The parent company was subject to a full scope audit

for the purposes of the Group and Parent Company

financial statements.

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108

The Impact of Climate Change on the Audit

In planning our audit we have considered the potential

impact of the risk arising from climate change on the

Group’s business and its financial statements.

Further information on the Group’s commitments is

provided in the Group’s Task Force for Climate-Related

Financial Disclosures (“TCFD”) disclosures on page 40.

As part of our audit we have performed a risk

assessment, including making enquiries of management,

reading board minutes and applying our knowledge of

the Group and the sector within which it operates, to

understand the extent of the potential impact of climate

change on the Group’s financial statements. Taking

account of the nature of the business and the extent

of the headroom in impairment testing. We have not

assessed climate related risk to be significant to our

audit. There was no impact on our key audit matters.

We have read the Group’s TCFD and considered

consistency with the financial statements and our

audit knowledge.

We have not been engaged to provide assurance over

the accuracy of the climate risk disclosures set out on

pages 40 to 45 in the Annual Report.

Conclusions Relating to Going Concern

In auditing the financial statements, we have concluded

that the Directors’ use of the going concern basis

of accounting in the preparation of the financial

statements is appropriate.

Our evaluation of the Directors’ assessment of the

Group’s and parent company’s ability to continue to

adopt the going concern basis of accounting included:-

• Obtaining an understanding of management’s

going concern models, discussing key assumptions

with management and assessing whether those

assumptions were consistent with those applied

elsewhere, such as in relation to inventory valuation

and the assessment of property related provisions.

• Checking the mathematical accuracy of

management’s cashflow models, and agreeing

opening balances to 24 April 2022 actual figures.

• Checking management’s covenant compliance

calculations to determine whether there is a risk

of breach and assessed whether the assumptions

in management’s base model appeared realistic,

achievable and consistent with other internal and

external evidence.

• Comparing forecast sales with recent historical

information to consider the accuracy of forecasting.

• Considering post year end sales patterns to assess

whether they were consistent with those assumed in

the base model.

• Critically assessing and testing management’s

sensitivity analysis and performing our own analysis

based on further sensitising of the models to take

account of reasonably possible scenarios that could

arise from the risks identified.

• Challenging management regarding their

identification of discretionary spend that could be

reduced should mitigating actions become necessary.

• Reviewing agreements and correspondence relating

to the availability of financing arrangements.

• Evaluating the Group’s disclosures on going concern

against the requirements of IAS 1.

Based on the work we have performed, we have not

identified any material uncertainties relating to events

or conditions that, individually or collectively, may

cast significant doubt on the Group’s or the parent

company’s ability to continue as a going concern for a

period of at least twelve months from when the financial

statements are authorised for issue.

In relation to the Directors’ reporting on how they have

applied the UK Corporate Governance Code, we have

nothing material to add or draw attention to in relation

to the Directors’ statement in the financial statements

about whether the Directors considered it appropriate to

adopt the going concern basis of accounting.

Our responsibilities and the responsibilities of the

Directors with respect to going concern are described in

the relevant sections of this report.

Other Information

The other information comprises the information

included in the annual report on pages 1 to 101 other

than the financial statements and our auditor’s report

thereon. The Directors are responsible for the other

information contained within the annual report. Our

opinion on the financial statements does not cover the

other information and, except to the extent otherwise

explicitly stated in our report, we do not express any

form of assurance conclusion thereon.

In connection with our audit of the financial statements,

our responsibility is to read the other information and,

in doing so, consider whether the other information is

materially inconsistent with the financial statements

or our knowledge obtained in the audit or otherwise

appears to be materially misstated.

If we identify such material inconsistencies or apparent

material misstatements, we are required to determine

whether there is a material misstatement in the financial

statements or a material misstatement of the other

information. If, based on the work we have performed,

we conclude that there is a material misstatement of this

other information, we are required to report that fact.

We have nothing to report in this regard.

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Opinions on Other Matters Prescribed by

the Companies Act 2006

In our opinion, the part of the Directors’ remuneration

report to be audited has been properly prepared in

accordance with the Companies Act 2006.

In our opinion, based on the work undertaken in the

course of the audit:

• the information given in the Strategic Report and

the Directors’ Report for the financial period for

which the financial statements are prepared is

consistent with the financial statements and those

reports have been prepared in accordance with

applicable legal requirements;

• the information about internal control and risk

management systems in relation to financial

reporting processes and about share capital

structures, given in compliance with rules 7.2.5

and 7.2.6 in the Disclosure Rules and Transparency

Rules sourcebook made by the Financial Conduct

Authority (the FCA Rules), is consistent with the

financial statements and has been prepared in

accordance with applicable legal requirements; and

• information about the company’s corporate

governance code and practices and about its

administrative, management and supervisory bodies

and their committees complies with rules 7.2.2, 7.2.3

and 7.2.7 of the FCA Rules.

Matters on which we are Required to

Report by Exception

In the light of the knowledge and understanding of the

Group and the parent company and their environment

obtained in the course of the audit, we have not

identified material misstatements in:

• the Strategic Report or the Directors’ Report; or

• the information about internal control and risk

management systems in relation to financial

reporting processes and about share capital

structures, given in compliance with rules 7.2.5 and

7.2.6 of the FCA Rules.

We have nothing to report in respect of the following

matters in relation to which the Companies Act 2006

requires us to report to you if, in our opinion:

• adequate accounting records have not been kept

by the parent company, or returns adequate for our

audit have not been received from branches not

visited by us; or

• the parent company financial statements and the

part of the Directors’ remuneration report to be

audited are not in agreement with the accounting

records and returns; or

• certain disclosures of Directors’ remuneration

specified by law are not made; or

• we have not received all the information and

explanations we require for our audit.

Corporate Governance Statement

We have reviewed the Directors’ statement in relation to

going concern, longer-term viability and that part of the

Corporate Governance Statement relating to the parent

company’s compliance with the provisions of the UK

Corporate Governance Code specified for our review by

the Listing Rules.

Based on the work undertaken as part of our audit, we

have concluded that each of the following elements

of the Corporate Governance Statement is materially

consistent with the financial statements or our

knowledge obtained during the audit:

• Directors’ statement with regards the

appropriateness of adopting the going concern

basis of accounting and any material uncertainties

identified set out on page 99;

• Directors’ explanation as to its assessment of the

Group’s prospects, the period this assessment

covers and why this period is appropriate set out on

page 63;

• Director’s statement on whether it has a

reasonable expectation that the Group will be

able to continue in operation and meets its

liabilities set out on page 99;

• Directors’ statement on fair, balanced and

understandable set out on page 92;

• Board’s confirmation that it has carried out a robust

assessment of the emerging and principal risks set

out on page 50;

• The section of the annual report that describes the

review of effectiveness of risk management and

internal control systems set out on page 71; and,

• The section describing the work of the audit

committee set out on page 89.

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110

Responsibilities of Directors

As explained more fully in the Directors’ responsibilities

statement set out on page 101, the Directors are

responsible for the preparation of the financial

statements and for being satisfied that they give a

true and fair view, and for such internal control as

the Directors determine is necessary to enable the

preparation of financial statements that are free from

material misstatement, whether due to fraud or error.

In preparing the financial statements, the Directors

are responsible for assessing the Group’s and the

parent company’s ability to continue as a going

concern, disclosing, as applicable, matters related to

going concern and using the going concern basis of

accounting unless the Directors either intend to liquidate

the Group or the parent company or to cease operations,

or have no realistic alternative but to do so.

Auditor’s Responsibilities for the Audit of

the Financial Statements

Our objectives are to obtain reasonable assurance

about whether the financial statements as a whole

are free from material misstatement, whether due to

fraud or error, and to issue an auditor’s report that

includes our opinion. Reasonable assurance is a high

level of assurance but is not a guarantee that an audit

conducted in accordance with ISAs (UK) will always

detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate,

they could reasonably be expected to influence the

economic decisions of users taken on the basis of these

financial statements.

The Extent to which the Audit was

Considered Capable of Detecting

Irregularities, Including Fraud

Irregularities are instances of non-compliance with

laws and regulations. The objectives of our audit

are to obtain sufficient appropriate audit evidence

regarding compliance with laws and regulations that

have a direct effect on the determination of material

amounts and disclosures in the financial statements, to

perform audit procedures to help identify instances of

non-compliance with other laws and regulations that

may have a material effect on the financial statements,

and to respond appropriately to identified or suspected

non-compliance with laws and regulations identified

during the audit.

In relation to fraud, the objectives of our audit are to

identify and assess the risk of material misstatement of

the financial statements due to fraud, to obtain sufficient

appropriate audit evidence regarding the assessed

risks of material misstatement due to fraud through

designing and implementing appropriate responses and

to respond appropriately to fraud or suspected fraud

identified during the audit.

However, it is the primary responsibility of management,

with the oversight of those charged with governance,

to ensure that the entity’s operations are conducted in

accordance with the provisions of laws and regulations

and for the prevention and detection of fraud.

In identifying and assessing risks of material

misstatement in respect of irregularities, including

fraud, the Group audit engagement team and

component auditors:

• obtained an understanding of the nature of

the industry and sector, including the legal and

regulatory frameworks that the Group and parent

company operates in and how the Group and

parent company are complying with the legal and

regulatory frameworks;

• inquired of management, and those charged with

governance, about their own identification and

assessment of the risks of irregularities, including

any known actual, suspected or alleged instances

of fraud;

• applied analytical review procedures to identify

unusual or unexpected relationships.

• discussed matters about non-compliance with

laws and regulations and how fraud might occur

including assessment of how and where the

financial statements may be susceptible to fraud

having obtained an understanding of the

control environment.

As the Group is regulated, our assessment of risks

involved gaining an understanding of the effectiveness

of the control environment including the controls

established to mitigate the risks of fraud and the

procedures for complying with regulatory requirements.

All relevant laws and regulations identified at a Group

level and areas susceptible to fraud that could have

a material effect on the financial statements were

communicated to component auditors. Any instances

of non-compliance with laws and regulations identified

and communicated by component auditors were

considered in our audit approach. We remained alert to

any indications of fraud throughout the audit.

As a result of these procedures, we considered the

opportunities and incentives that may exist within the

Group for fraud and identified the greatest potential for

fraud in those areas in which management is required

to exercise significant judgement. In common with

all audits under ISAs (UK) we also performed specific

procedures to respond to the risk of management

override and the risk of fraudulent revenue recognition.

FRASERS GROUP PLC ANNUAL REPORT 2022

111

These procedures included :-

• testing the appropriateness of journal entries

and other adjustments based on risk criteria and

comparing the identified entries to supporting

documentation.

• assessing whether the judgements made in

making accounting estimates were indicative of

potential bias.

• evaluating the business rationale of any significant

transactions that are unusual or outside the normal

course of business.

• testing the operating effectiveness of the manual

controls in relation to the completeness, accuracy,

and existence of cash sales.

• investigating transactions posted to nominal ledger

codes outside of the normal revenue cycle identified

through the use of data analytics tools.

The Group is subject to laws and regulations which

directly affect the material amounts and disclosures in

the financial statements. The most significant laws and

regulations were detertmined to be as follows:-United

Kingdom adopted International Accounting Standards

and FRS 102, the UK Companies Act, Financial Conduct

Authority regulations, including the Listing Rules and

tax legislation.

In addition, the Group is subject to other laws and

regulations which do not have a direct effect on the

financial statements but compliance with which may be

fundamental to the Group’s ability to operate or to avoid

material penalties. We identified the following areas as

those most likely to have such an effect: competition

and anti-bribery laws, data protection, employment,

environmental and health and safety regulations.

In response to the above, audit procedures performed by

the audit engagement team included:

• reviewing financial statement disclosures and

testing to supporting documentation to assess

compliance with provisions of relevant laws and

regulations described as having a direct effect on

the financial statements.

• enquiring of management, the Audit Committee

and in-house legal counsel concerning actual and

potential litigation and claims.

• reading minutes of meetings of those charged with

governance, reviewing internal audit reports and

correspondence with HMRC.

A further description of our responsibilities for the audit

of the financial statements is located on the Financial

Reporting Council’s website at: http://www.frc.org.uk/

auditorsresponsibilities. This description forms part of our

auditor’s report.

Other Matters Which We Are Required

to Address

Following the recommendation of the audit committee,

we were appointed by the Audit Committee and the

Board on 18 November 2019 to audit the financial

statements for the year ending 26 April 2020 and

subsequent financial periods.

The period of total uninterrupted consecutive

appointments is 3 years covering the years ending 26

April 2020 to 24 April 2022.

The non-audit services prohibited by the FRC’s Ethical

Standard were not provided to the Group or the parent

company and we remain independent of the Group and

the parent company in conducting our audit.

Our audit opinion is consistent with the additional report

to the audit committee.

Use of Our Report

This report is made solely to the company’s members,

as a body, in accordance with Chapter 3 of Part 16 of

the Companies Act 2006. Our audit work has been

undertaken so that we might state to the company’s

members those matters we are required to state to them

in an auditor’s report and for no other purpose. To the

fullest extent permitted by law, we do not accept or

assume responsibility to anyone other than the company

and the company’s members as a body, for our audit

work, for this report, or for the opinions we have formed.

Other Matter

In due course, as required by the Financial Conduct

Authority (FCA) Disclosure Guidance and Transparency

Rule (DTR) 4.1.14R, these financial statements will form

part of the European Single Electronic Format (ESEF)

prepared Annual Financial Report filed on the National

Storage Mechanism of the UK FCA in accordance with

the ESEF Regulatory Technical Standard (‘ESEF RTS’).

This auditor’s report provides no assurance over whether

the annual financial report will be prepared using the

single electronic format specified in the ESEF RTS.

Mark Harwood (Senior Statutory Auditor)

For and on behalf of RSM UK Audit LLP,

Statutory Auditor

Chartered Accountants

25 Farringdon Street

London

EC4A 4AB

Date: 20 September 2022.

FRASERS GROUP PLC ANNUAL REPORT 2022

112

CONSOLIDATED INCOME

STATEMENT

For the 52 weeks ended 24 April 2022

Note

Continuing

operations

52 weeks ended

24 April 2022

Discontinued

operations

52 weeks ended

24 April 2022

Total

52 weeks ended

24 April 2022

Continuing

operations

52 weeks ended

25 April 2021

Discontinued

operations

52 weeks ended

25 April 2021

Total

52 weeks ended

25 April 2021

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Revenue 4,672.9 114.2 4,787.1 3,507.3 118.0 3,625.3

Credit account interest 18.2 - 18.2 - - -

Total revenue (including

credit account interest)

4 4,691.1 114.2 4,805.3 3,507.3 118.0 3,625.3

Cost of sales (2,647.2) (56.1) (2,703.3) (2,023.4) (71.1) (2,094.5)

Impairment losses on credit

customer receivables

4 (13.3) - (13.3) - - -

Gross Profit 2,030.6 58.1 2,088.7 1,483.9 46.9 1,530.8

Selling, distribution and

administrative expenses

(1,557.3) (31.5) (1,588.8) (1,281.6) (37.4) (1,319.0)

Other operating income 5 45.4 2.6 48.0 33.3 3.5 36.8

Property related

impairments

17, 18 (227.0) - (227.0) (317.0) - (317.0)

Exceptional items 6 (1.3) - (1.3) (1.6) - (1.6)

Profit on sale of properties 7 10.8 - 10.8 9.7 - 9.7

Operating Profit/(Loss) 4,8 301.2 29.2 330.4 (73.3) 13.0 (60.3)

Investment income 10 43.8 - 43.8 103.7 - 103.7

Investment costs 11 (19.7) - (19.7) (7.7) - (7.7)

Finance income 12 30.3 - 30.3 9.0 - 9.0

Finance costs 13 (48.9) (0.3) (49.2) (32.9) (3.3) (36.2)

Profit/(loss) before taxation 306.7 28.9 335.6 (1.2) 9.7 8.5

Taxation 14 (75.5) (3.2) (78.7) (85.4) (1.1) (86.5)

Profit/(loss) for the period 4 231.2 25.7 256.9 (86.6) 8.6 (78.0)

ATTRIBUTABLE TO:

Equity holders of the Group 224.1 25.7 249.8 (91.6) 8.6 (83.0)

Non-controlling interests 7.1 - 7.1 5.0 - 5.0

Profit/(loss) for the period 4 231.2 25.7 256.9 (86.6) 8.6 (78.0)

Pence per share Pence per share Pence per share Pence per share Pence per share Pence per share

Basic earnings per share 15 47.5 5.4 52.9 (18.2) 1.7 (16.5)

Diluted earnings per share 15 47.5 5.4 52.9 (18.2) 1.7 (16.5)

Discontinued operations relate to the Group’s US retail businesses which were disposed of post year-end (see note 16).

The accompanying accounting policies and notes form part of these financial statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

113

CONSOLIDATED STATEMENT OF

COMPREHENSIVE INCOME

For the 52 weeks ended 24 April 2022

Note

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£’m) (£’m)

Profit/(loss) for the period 4 256.9 (78.0)

OTHER COMPREHENSIVE INCOME

ITEMS THAT WILL NOT BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS

Fair value movement on long-term financial assets 21 (8.1) 77.3

Remeasurements of defined benefit pension scheme 38 (26.8) -

Deferred tax on remeasurements of defined benefit pension scheme 28 6.7 -

ITEMS THAT WILL BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS

Exchange differences on translation of foreign operations 26 6.8 (49.1)

Fair value movement on hedged contracts - recognised in the period 26,30 52.1 0.4

Fair value movement on hedged contracts - reclassified and reported in sales 26,30 - (2.8)

Fair value movement on hedged contracts - reclassified and reported in inventory/cost of sales 26,30 7.5 (17.1)

Fair value movement on hedged contracts - taxation taken to reserves 26,30 (15.8) 3.0

OTHER COMPREHENSIVE INCOME FOR THE PERIOD, NET OF TAX 22.4 11.7

TOTAL COMPREHENSIVE INCOME/LOSS FOR THE PERIOD 279.3 (66.3)

ATTRIBUTABLE TO:

Equity holders of the Group 272.2 (71.3)

Non-controlling interest 7.1 5.0

279.3 (66.3)

The accompanying accounting policies and notes form part of these financial statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

114

CONSOLIDATED BALANCE SHEET

At 24 April 2022

Note

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£’m) (£’m)

ASSETS  NON CURRENT

Property, plant and equipment 17 1,011.0 1,164.9

Investment properties 18 89.2 14.1

Intangible assets 19 120.6 120.5

Long-term financial assets 21 206.6 263.3

Retirement benefit surplus 38 2.2 -

Deferred tax assets 28 100.8 66.8

1,530.4 1,629.6

ASSETS - CURRENT

Inventories 22 1,277.6 1,096.6

Trade and other receivables 23 841.4 546.5

Derivative financial assets 30 116.5 55.4

Cash and cash equivalents 24 336.8 457.0

2,572.3 2,155.5

Assets in disposal groups classified as held for sale 16 40.0 -

TOTAL ASSETS 4,142.7 3,785.1

EQUITY

Share capital 25 64.1 64.1

Share premium 874.3 874.3

Treasury shares reserve 26 (488.9) (295.7)

Permanent contribution to capital 26 0.1 0.1

Capital redemption reserve 26 8.0 8.0

Foreign currency translation reserve 26 35.6 28.8

Reverse combination reserve 26 (987.3) (987.3)

Own share reserve 26 (66.8) (66.7)

Hedging reserve 26 55.3 11.5

Share based payment reserve 14.1 1.3

Retained earnings 1,778.1 1,554.5

Issued capital and reserves attributable to owners of the parent 1,286.6 1,192.9

Non-controlling interests 22.0 18.1

TOTAL EQUITY 1,308.6 1,211.0

LIABILITIES  NON CURRENT

Lease liability 27 503.6 534.2

Borrowings 27 827.9 705.9

Retirement benefit obligations 1.6 1.9

Deferred tax liabilities 28 40.4 27.0

Provisions 29 433.0 361.2

1,806.5 1,630.2

LIABILITIES - CURRENT

Derivative financial liability 30 107.2 19.2

Trade and other payables 31 729.8 646.3

Lease liability 27 117.0 188.5

Current tax liabilities 50.9 89.9

1,004.9 943.9

Liabilities in disposal groups classified as held for sale 16 22.7 -

TOTAL LIABILITIES 2,834.1 2,574.1

TOTAL EQUITY AND LIABILITIES 4,142.7 3,785.1

The accompanying accounting policies and notes form part of these Financial Statements. The Financial Statements

were approved by the Board on 20 September 2022 and were signed on its behalf by:

Chris Wootton

Chief Financial Officer

Company number: 06035106

FRASERS GROUP PLC ANNUAL REPORT 2022

115

CONSOLIDATED CASH FLOW

STATEMENT

For the 52 weeks ended 24 April 2022

Note

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£’m) (£’m)

Cash inflows from operating activities 33 628.9 578.3

Income taxes paid (121.0) (59.3)

Net cash inflows from operating activities 507.9 519.0

Proceeds on disposal of property, plant and equipment and investment property 32.0 20.6

Proceeds from sale and leaseback transactions 9.5 -

Proceeds on disposal of intangibles assets - 7.5

Proceeds on disposal of listed investments

(1)

21 238.4 7.0

Proceeds in relation to equity derivatives

(1)

117.4 48.1

Disposal of subsidiary undertaking 1.0 -

Purchase of subsidiaries, net of cash acquired 32 (0.2) (39.4)

Purchase of property, plant and equipment and investment property 17, 18 (323.2) (219.4)

Purchase of intangible assets 19 - (1.0)

Purchase of listed investments 21 (198.4) (113.3)

Investment income received 1.0 0.5

Finance income received 6.3 9.0

Net cash outflows from investing activities (116.2) (280.4)

Lease payments (176.2) (78.0)

Finance costs paid (32.8) (31.6)

Borrowings drawn down 27 1,374.4 1,128.1

Borrowings repaid 27 (1,484.4) (1,323.6)

Proceeds from sale and leaseback transactions 1.5 -

Dividends paid to non-controlling interests (1.3) (0.9)

Purchase of own shares (193.2) (4.3)

Net cash outflows from financing activities (512.0) (310.3)

Net decrease in cash and cash equivalents including overdrafts (120.3) (71.7)

Exchange movement on cash balances 0.1 (5.3)

Cash and cash equivalents including overdrafts at beginning of period 457.0 534.0

Cash and cash equivalents including overdrafts at the period end 24 336.8 457.0

(1) Proceeds in relation to equity derivatives in both the current and prior periods have been shown separately from proceeds on disposal of listed investments.

This has no impact on net cash outflows from investing activities or net cash.

The accompanying accounting policies and notes form part of these Financial Statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

116

CONSOLIDATED STATEMENT OF

CHANGES IN EQUITY

For the 52 weeks ended 24 April 2022

capital

premium

(1)

Treasury

scheme

reserve

Foreign

currency

translation

Own

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 27 April 2020

64.1 874.3 (295.7) - 77.9 (67.0) 1,564.9 (951.2) 1,267.3 13.0 1,280.3

Acquisitions

- - - - - - - - - 1.0 1.0

Share scheme

- - - 1.3 - 0.3 (4.7) - (3.1) - (3.1)

Dividends paid to

non-controlling interests

- - - - - - - - - (0.9) (0.9)

Transactions with owners in

their capacity as owners

- - - 1.3 - 0.3 (4.7) - (3.1) 0.1 (3.0)

(Loss)/profit for the financial

period

- - - - - - (83.0) - (83.0) 5.0 (78.0)

Other comprehensive income

Cashflow hedges - recognised

in the period

- - - - - - - 0.4 0.4 - 0.4

Cashflow hedges - reclassified

and reported in sales

- - - - - - - (2.8) (2.8) - (2.8)

Cashflow hedges - reclassified

and reported in inventory/cost

of sales

- - - - - - - (17.1) (17.1) - (17.1)

Cashflow hedges - taxation

- - - - - - - 3.0 3.0 - 3.0

Fair value adjustment in respect

of long-term financial assets -

recognised

- - - - - - 77.3 - 77.3 - 77.3

Translation differences - Group

- - - - (49.1) - - - (49.1) - (49.1)

Total comprehensive loss for

the period

- - - - (49.1) - (5.7) (16.5) (71.3) 5.0 (66.3)

At 25 April 2021

64.1 874.3 (295.7) 1.3 28.8 (66.7) 1,554.5 (967.7) 1,192.9 18.1 1,211.0

Acquisitions

- - - - - - 1.9 - 1.9 (1.9) -

Share scheme

- - - 12.8 - (0.1) 0.1 - 12.8 - 12.8

Dividends paid to

non-controlling interests

- - - - - - - - - (1.3) (1.3)

Transactions with owners in

their capacity as owners

- - - 12.8 - (0.1) 2.0 - 14.7 (3.2) 11.5

Profit for the financial period

- - - - - - 249.8 - 249.8 7.1 256.9

Other comprehensive income

Purchase of own shares

- - (193.2) - - - - - (193.2) - (193.2)

Cashflow hedges - recognised

in the period

- - - - - - - 52.1 52.1 - 52.1

Cashflow hedges - reclassified

and reported in inventory/cost

of sales

- - - - - - - 7.5 7.5 - 7.5

Cashflow hedges - taxation

- - - - - - - (15.8) (15.8) - (15.8)

Fair value adjustment in respect

of long-term financial assets -

recognised

- - - - - - (8.1) - (8.1) - (8.1)

Remeasurements of defined

benefit pension scheme

- - - - - - (26.8) - (26.8) - (26.8)

Deferred tax on

remeasurements of defined

benefit pension scheme

- - - - - - 6.7 - 6.7 - 6.7

Translation differences - Group

- - - - 6.8 - - - 6.8 - 6.8

Total comprehensive income

for the period

- - (193.2) - 6.8 - 221.6 43.8 79.0 7.1 86.1

At 24 April 2022

64.1 874.3

(488.9) 14.1 35.6 (66.8) 1,778.1 (923.9) 1,286.6 22.0 1,308.6

(1) The share premium account is used to record the excess proceeds over nominal value on the issue of shares.

(2) Other reserves comprises permanent contribution to capital, capital redemption reserve, reverse combination reserve and the hedging reserve.

All movements in the period related to the hedging reserve (note 26).

The accompanying accounting policies and notes form part of these Financial Statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

117

NOTES TO THE FINANCIAL

STATEMENTS

For the 52 weeks ended 24 April 2022

1. ACCOUNTING POLICIES

Frasers Group Plc (Company number: 06035106) is a

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.

Basis of Preparation

The consolidated Financial Statements have been

prepared in accordance with International Accounting

Standards in conformity with the requirements of

the Companies Act 2006 and in accordance with

international financial reporting standards adopted by

the UK Endorsement Board. This change in the basis of

preparation is required by UK company law for financial

reporting as a result of the UK’s exit from the European

Union on 31 January 2020 and the cessation of the

transition period on 31 December 2020. This change

does not constitute a change in accounting policy, rather

a change in framework which is required to group the

use of IFRS in company law. There is no impact on the

recognition, measurement or disclosure between the two

frameworks in the period reported. The consolidated

Financial Statements have been prepared under the

historical cost convention, as modified to include fair

valuation of certain financial assets and derivative

financial instruments.

The accounting policies set out below have been applied

consistently to all periods in these Financial Statements

and have been applied consistently by all Group entities.

Certain subsidiaries have been consolidated based on a

calendar year-end date of 30 April 2022.

The numbers presented in the Financial Statements have

been rounded to the nearest million.

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.

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 November 2024 with a two year option

to extend, 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 have assessed the level of trading and

have 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

EBITDA ratios). Management also has a number of

mitigating actions which could be taken if required

such as putting on hold discretionary spend, liquidate

certain assets on the Balance Sheet and pay down the

Revolving Credit Facility. See the Viability Statement 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 during the pandemic

to require mitigating actions or a relaxation of covenants.

Furthermore, as per the outlook statement the Directors

are confident of achieving an Adjusted PBT for FY23 of

between £450m to £500m during FY23. 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.

FRASERS GROUP PLC ANNUAL REPORT 2022

118

Basis of Consolidation

The consolidated Financial Statements incorporate

the financial statements of the Company and entities

controlled by the Company (its subsidiaries) each year.

Control is achieved when the Company:

• has the power over the investee;

• is exposed, or has rights, to variable returns from its

involvement with the investee; and

• has the ability to use its power to affect its returns.

The Company reassesses whether or not it controls an

investee if facts and circumstances indicate that there

are changes to one or more of the three elements of

control listed above.

When the Company has less than a majority of the

voting rights of an investee, it considers that it has power

over the investee when the voting rights are sufficient to

give it the practical ability to direct the relevant activities

of the investee unilaterally. The Company considers all

relevant facts and circumstances in assessing whether

or not the Company’s voting rights in an investee are

sufficient to give it power, including:

• the size of the Company’s holding of voting rights

relative to the size and dispersion of holdings of the

other vote holders;

• potential voting rights held by the Company, other

vote holders or other parties;

• rights arising from other contractual arrangements;

and

• any additional facts and circumstances that

indicate that the Company has, or does not have,

the current ability to direct the relevant activities at

the time that decisions need to be made, including

voting patterns at previous shareholders’ meetings.

Consolidation of a subsidiary begins when the Company

obtains control over the subsidiary and ceases when the

Company loses control of the subsidiary. Specifically, the

results of subsidiaries acquired or disposed of during

the year are included in profit or loss from the date

the Company gains control until the date when the

Company ceases to control the subsidiary.

Where necessary, adjustments are made to the

financial statements of subsidiaries to bring the

accounting policies used into line with the Group’s

accounting policies.

All intragroup assets and liabilities, equity, income,

expenses and cash flows relating to transactions

between the members of the Group are eliminated

on consolidation.

Non-controlling interests in subsidiaries are identified

separately from the Group’s equity therein. Those

interests of non-controlling shareholders that are

present ownership interests entitling their holders to

a proportionate share of net assets upon liquidation

may initially be measured at fair value or at the

non-controlling interests’ proportionate share of the

fair value of the acquiree’s identifiable net assets. The

choice of measurement is made on an acquisition-

by-acquisition basis. Other non-controlling interests

are initially measured at fair value. Subsequent to

acquisition, the carrying amount of non-controlling

interests is the amount of those interests at initial

recognition plus the non-controlling interests’ share of

subsequent changes in equity.

Profit or loss and each component of other

comprehensive income are attributed to the owners

of the Company and to the non-controlling interests.

Total comprehensive income of the subsidiaries is

attributed to the owners of the Company and to the

non-controlling interests even if this results in the

non-controlling interests having a deficit balance.

Changes in the Group’s interests in subsidiaries that

do not result in a loss of control are accounted for as

equity transactions. The carrying amount of the Group’s

interests and the non-controlling interests are adjusted

to reflect the changes in their relative interests in the

subsidiaries. Any difference between the amount by

which the non-controlling interests are adjusted and

the fair value of the consideration paid or received

is recognised directly in equity and attributed to the

owners of the Company.

When the Group loses control of a subsidiary, the gain or

loss on disposal recognised in profit or loss is calculated

as the difference between (i) the aggregate of the fair

value of the consideration received and the fair value

of any retained interest and (ii) the previous carrying

amount of the assets (including goodwill), less liabilities

of the subsidiary and any non-controlling interests. All

amounts previously recognised in other comprehensive

income in relation to that subsidiary are accounted

for as if the Group had directly disposed of the related

assets or liabilities of the subsidiary (i.e. reclassified to

profit or loss or transferred to another category of equity

as required/permitted by applicable IFRS Standards).

The fair value of any investment retained in the former

subsidiary at the date when control is lost is regarded

as the fair value on initial recognition for subsequent

accounting under IFRS 9 when applicable, or the cost on

initial recognition of an investment in an associate or a

joint venture.

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Business Combinations

Acquisitions of businesses are accounted for using the

acquisition method. The consideration transferred in a

business combination is measured at fair value, which is

calculated as the sum of the acquisition-date fair values

of assets transferred to the Group, liabilities incurred

by the Group to the former owners of the acquiree and

the equity interest issued by the Group in exchange for

control of the acquiree. Acquisition-related costs are

recognised in profit or loss as incurred.

At the acquisition date, the identifiable assets acquired

and the liabilities assumed are recognised at their fair

value at the acquisition date, except that:

• deferred tax assets or liabilities and assets or

liabilities related to employee benefit arrangements

are recognised and measured in accordance with

IAS 12 and IAS 19 respectively;

• liabilities or equity instruments related to

share-based payment arrangements of the acquiree

or share-based payment arrangements of the

Group entered into to replace share-based payment

arrangements of the acquiree are measured in

accordance with IFRS 2 at the acquisition date; and

• assets (or disposal groups) that are classified as held

for sale in accordance with IFRS 5 are measured in

accordance with that Standard.

Goodwill is measured as the excess of the sum of

the consideration transferred, the amount of any

non-controlling interests in the acquiree, and the fair

value of the acquirer’s previously held equity interest in

the acquiree (if any) over the net of the acquisition-date

amounts of the identifiable assets acquired and the

liabilities assumed. If, after reassessment, the net of

the acquisition-date amounts of the identifiable assets

acquired and liabilities assumed exceeds the sum

of the consideration transferred, the amount of any

non-controlling interests in the acquiree and the fair

value of the acquirer’s previously held interest in the

acquiree (if any), the excess is recognised immediately in

profit or loss as a bargain purchase gain.

For business combinations achieved in stages, the Group

remeasures its previously held equity interest in the

acquiree at its acquisition date fair value and recognises

the resulting gain or loss, if any, in the Income Statement

as appropriate.

Associates

An associate is an entity over which the Group has

significant influence and that is neither a subsidiary

nor an interest in a joint venture. Significant influence is

the power to participate in the financial and operating

policy decisions of the investee but is not control or joint

control over those policies.

The results and assets and liabilities of associates

are incorporated in these Financial Statements using

the equity method of accounting, except when the

investment is classified as held for sale, in which case it is

accounted for in accordance with IFRS 5.

Under the equity method, an investment in an associate

is recognised initially in the consolidated Balance Sheet

at cost and adjusted thereafter to recognise the Group’s

share of the profit or loss and other comprehensive

income of the associate. When the Group’s share of

losses of an associate or a joint venture exceeds the

Group’s interest in that associate (which includes any

long-term interests that, in substance, form part of the

Group’s net investment in the associate), the Group

discontinues recognising its share of further losses.

Additional losses are recognised only to the extent that

the Group has incurred legal or constructive obligations

or made payments on behalf of the associate.

An investment in an associate is accounted for using

the equity method from the date on which the

investee becomes an associate. On acquisition of the

investment in an associate, any excess of the cost of the

investment over the Group’s share of the net fair value

of the identifiable assets and liabilities of the investee

is recognised as goodwill, which is included within the

carrying amount of the investment. Any excess of the

Group’s share of the net fair value of the identifiable

assets and liabilities over the cost of the investment,

after reassessment, is recognised immediately in profit or

loss in the period in which the investment is acquired.

The requirements of IAS 36 are applied to determine

whether it is necessary to recognise any impairment

loss with respect to the Group’s investment in an

associate. When necessary, the entire carrying

amount of the investment (including goodwill) is

tested for impairment in accordance with IAS 36 as

a single asset by comparing its recoverable amount

(higher of value in use and fair value less costs of

disposal) with its carrying amount. Any reversal of

that impairment loss is recognised in accordance

with IAS 36 to the extent that the recoverable amount

of the investment subsequently increases.

The Group discontinues the use of the equity method

from the date when the investment ceases to be an

associate. When the Group retains an interest in the

former associate and the retained interest is a financial

asset, the Group measures the retained interest at fair

value at that date and the fair value is regarded as

its fair value on initial recognition in accordance with

IFRS 9. The difference between the carrying amount

of the associate at the date the equity method was

discontinued, and the fair value of any retained interest

and any proceeds from disposing of a part interest in the

associate is included in the determination of the gain or

loss on disposal of the associate. In addition, the Group

FRASERS GROUP PLC ANNUAL REPORT 2022

120

accounts for all amounts previously recognised in other

comprehensive income in relation to that associate on

the same basis as would be required if that associate

had directly disposed of the related assets or liabilities.

Therefore, if a gain or loss previously recognised in other

comprehensive income by that associate would be

reclassified to profit or loss on the disposal of the related

assets or liabilities, the Group reclassifies the gain or

loss from equity to profit or loss (as a reclassification

adjustment) when the associate is disposed of.

When the Group reduces its ownership interest in an

associate but the Group continues to use the equity

method, the Group reclassifies to profit or loss the

proportion of the gain or loss that had previously

been recognised in other comprehensive income

relating to that reduction in ownership interest if

that gain or loss would be reclassified to profit or

loss on the disposal of the related assets or liabilities.

When a group entity transacts with an associate

of the Group, profits and losses resulting from the

transactions with the associate or joint venture are

recognised in the Group’s consolidated Financial

Statements only to the extent of interests in the

associate that are not related to the Group.

Revenue Recognition

Revenue with customers is measured based on the

five-step model under IFRS 15: ‘Revenue from Contracts

with Customers’:

1. identify the contract with the customer;

2. identify the performance obligations in the contract;

3. determine the transaction price;

4. allocate the transaction price to separate

performance obligations in the contract; and

5. recognise revenues when (or as) each performance

obligation is satisfied.

Revenue is measured at the fair value of the

consideration received, or receivable, and represents

amounts receivable for goods supplied, stated net of

discounts, returns and value added taxes. Customers

have a right of return within a specified period and this

gives rise to variable consideration under IFRS 15. The

right of return asset is recognised within inventory, with

the refund liability due to customers on return of their

goods recognised within trade and other payables.

In the case of goods sold through retail stores, revenue

is recognised when we have satisfied the performance

obligation of transferring the goods to the customer at

the point of sale, less provision for returns. Accumulated

experience is used to estimate and provide for such

returns at the time of the sale. Retail sales are usually in

cash, by debit card or by credit card.

In the case of goods sold on the internet where the

customer has opted for delivery, revenue is recognised

when we have satisfied the performance obligation

of transferring the goods to the customer, which is at

the point of delivery to the customer. Transactions are

settled by credit card or debit card. Provisions are made

for internet credit notes based on the expected level of

returns using the expected value method, which in turn

is based upon the historical rate of returns. In the case

of internet click and collect orders which are collected

in store, the performance obligation is deemed to have

been satisfied when the goods are dispatched from

the warehouse.

In the case of goods sold to other businesses via

wholesale channels, revenue is recognised when we

have satisfied the performance obligation of transferring

the goods to the customer upon delivery. Payment terms

are generally 30-60 days with no right of return.

In the case of income generated from trademarks and

licences, revenue is recognised based either on a fixed

fee basis or based on sales with specified minimum

guarantee amounts in accordance with the relevant

agreements. If the sales-based royalty is not expected

to clearly exceed the minimum guarantee threshold,

revenue is recognised over the rights period measured

on the basis of the fixed guaranteed consideration.

Revenue above the minimum guarantee threshold is

recognised as earned based on the contractual royalty

rate applied to the sales.

Revenue from Gym membership fees is stated exclusive

of value added tax and comprises monthly membership

fees, non-refundable joining fees and longer term

membership fees recognised during the period.

Membership income is recognised and spread over

the period to which it relates, being the period of the

Group’s performance obligations, with any subscriptions

in advance of the period to which they relate being

recognised as contract liabilities. Joining fee income

is recognised over time, on a straight-line basis over

the expected duration of the membership. Gym retail

income is recognised at the point of sale. Other revenue

includes various ancillary revenue streams, which are

recognised in the period to which they relate. Total

revenue from gyms recognised in FY22 is £47.4m (FY21:

£14.0m) and is recognised in the UK Retail segment.

In the case of revenue from third party commission on

concession sales within the House of Fraser department

stores this is recognised when goods are sold to the

customer. As we act as the agent this is stated at the

value of the commission that the Group receives on the

transaction rather than the gross revenue from the sale

of the concessionaires’ goods.

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121

The Group operates loyalty programmes which allow

members to accumulate points on purchases and

receive exclusive offers and benefits. The fair value of

the points awarded to customers is determined relative

to the total transaction price and accounted for as a

separate identifiable component of a sales transaction.

Revenue is deferred to match the estimated value of

earned loyalty points. Deferred revenue is adjusted

for the value of points that are not expected to be

redeemed by customers based on historical redemption

rates. When the points are redeemed and the Group

fulfils its obligations pursuant to the programmes, the

revenue that was deferred is recognised. In the UK

points awarded expire following a period of 12 months

of inactivity, in Spain they are valid until the end of the

following calendar year.

Revenue from gift cards and vouchers is recognised

when the cards or vouchers are redeemed by the

customer, breakage is recognised when the likelihood

of the card or voucher being redeemed is remote or

has expired. for gift cards monies received represent

deferred revenue prior to the redemption.

Credit account interest revenue related to interest

charged on trade receivables in Studio Retail Limited

is determined using the effective interest method.

Credit account interest revenue is calculated on the

gross carrying amount of the financial asset unless the

financial asset is impaired, in which case the interest

revenue is calculated on the amortised cost, after

allowance for expected credit losses. Credit account

interest revenue is recognised over time.

Government Grants

Government grants are not recognised until there is

reasonable assurance that the Group will comply with

the conditions attaching to them and that the grants will

be received.

Grants that are receivable as compensation for

expenses already incurred or for the purpose of

giving immediate financial support to the Group with

no future related costs are recognised in the Income

Statement at their fair value in the period in which

they become receivable.

The Group has received Government support in the

current and prior period relating to business rates relief

and in the prior period relating to the Coronavirus Job

Retention Scheme (CJRS) as a result of the Covid-19

pandemic. The amount received by the Group (including

the UK) in the period in regard to the CJRS (or equivalent

where received in non-UK territories) was £nil (FY21:

approx. £80.0m). The amount of business rates relief

received by the Group in the period (or equivalent where

received in non-UK territories) was approx. £38.2m (FY21:

£97.5m). Government grants that compensate the Group

for expenses incurred are recognised in profit or loss

as a deduction against the related expense over the

periods necessary to match them with the related costs.

The amounts quoted have been recognised in Selling,

distribution and administrative expenses in the period.

Exceptional Items

The Group presents exceptional items on the face of

the Income Statement. These are significant items of

income and expense which, because of their size, nature

and infrequency of the events giving rise to them, merit

separate presentation to allow shareholders to better

understand the elements of financial performance in the

year, so as to facilitate comparison with prior periods

and assess trends in financial performance more readily.

Finance Income

Finance income is reported on an accruals basis using

the effective interest method.

Taxation

Tax expense comprises of current and deferred tax.

Tax is recognised in the Income Statement, except

to the extent it relates to items recognised in other

comprehensive income or directly in equity. The

income tax expense or credit for the period is the

tax payable on the current periods taxable income,

based on the applicable income tax rate for each

jurisdiction, adjusted by changes in deferred tax

assets and liabilities attributable to temporary

differences and to unused losses.

Deferred taxation is calculated using the liability method,

on temporary differences arising between the tax bases

of assets and liabilities and their carrying amounts in

the consolidated Financial Statements. However, if

the deferred tax arises from the initial recognition of

goodwill or initial recognition of an asset or liability in a

transaction other than a business combination that at

the time of the transaction affects neither accounting

nor taxable profit or loss, it is not accounted for. Deferred

tax on temporary differences associated with shares in

subsidiaries is not provided if reversal of these temporary

differences can be controlled by the Group and it is

probable that reversal will not occur in the foreseeable

future. In addition, tax losses available to be carried

forward as well as other income tax credits to the Group

are assessed for recognition as deferred tax assets.

Deferred tax is determined using tax rates and laws that

have been enacted (or substantively enacted) by the

balance sheet date and are expected to apply when the

related deferred tax asset is realised or the deferred tax

liability is settled.

Deferred tax liabilities are provided in full.

Deferred tax assets are recognised to the extent that it

is probable that future taxable profits will be available

against which the temporary differences can be utilised.

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122

Deferred tax assets are offset where there is a legally

enforceable right to offset current tax assets and

liabilities and where the deferred tax balances relate to

the same tax authority.

Changes in current and deferred tax assets or liabilities

are recognised as a component of tax expense in the

Income Statement, except where they relate to items

that are recorded in other comprehensive income

or charged or credited directly to equity in which

case the related deferred tax is also charged to other

comprehensive income or credited directly to equity.

Deferred tax assets and liabilities are not discounted.

Goodwill

Goodwill arising on consolidation is recognised as an

asset and reviewed for impairment at least annually or

when a change in circumstances or situation indicates

that the goodwill has suffered an impairment loss.

The need for impairment is tested by comparing the

recoverable amount of the cash-generating unit (CGU)

to which the goodwill balance has been allocated, which

is the higher of fair value less costs to sell and value in

use, to the carrying value of the goodwill balance. Any

impairment is recognised immediately in the Income

Statement. Impairment losses on goodwill are not

reversed. Gains and losses on the disposal of a business

include the amount of goodwill relating to that business.

When the non-controlling interest of an existing

subsidiary is acquired the carrying value of the

non-controlling interests in the Balance Sheet is

eliminated. Any difference between the amount by

which the non-controlling interest is adjusted and the

fair value of the consideration paid is recognised directly

in equity.

Other Intangible Assets

Brands, trademarks, licences and customer related

intangibles that are internally generated are not

recorded on the Balance Sheet. Acquired brands,

trademarks, licences and customer related intangibles

are initially carried on the Balance Sheet at cost. The

fair value of brands, trademarks, licences and customer

related intangibles that are acquired by virtue of a

business combination is determined at the date of

acquisition and is subsequently assessed as being the

deemed cost to the Group.

Expenditure on advertising and promotional activities is

recognised as an expense as incurred.

Amortisation is provided on brands, trademarks, licences

and customer related intangibles with a definite life

on a straight line basis over their useful economic lives

of between 1 to 15 years and is accounted for within

the selling, distribution and administrative expenses

category within the Income Statement.

Property, Plant and Equipment

Property, plant and equipment are stated at historical

cost less depreciation less any recognised impairment

losses. Cost includes expenditure that is directly

attributable to the acquisition or construction of these

items. Subsequent costs are included in the asset’s

carrying amount only when it is probable that future

economic benefits associated with the item will flow to

the Group and the costs can be measured reliably.

All other costs, including repairs and maintenance costs

and labour costs are charged to the Income Statement

in the period in which they are incurred.

Depreciation is provided on all property, plant and

equipment other than freehold land and is calculated

on a straight-line basis, whichever is deemed by the

Directors to be more appropriate, to allocate cost

less assessed residual value, other than assets in the

course of construction, over the estimated useful lives,

as follows:

• Freehold buildings - 15 years - straight line

• Leasehold improvements – 5 years or over the term

of the lease, whichever is shortest - straight line

• Plant and equipment – between 5 to 10 years -

straight line

A full year of depreciation is charged on all additions

in property, plant and equipment in the period. The

assets’ useful lives and residual values are reviewed and,

if appropriate, adjusted at each balance sheet date.

The gain or loss arising on disposal or scrapping of an

asset is determined as the difference between the sales

proceeds, net of selling costs, and the carrying amount

of the asset and is recognised in the Income Statement.

Property, plant and equipment where the carrying

amount is recovered principally through a sales

transaction and where a sale is considered to be highly

probable are stated at the lower of carrying value and

fair value less costs to sell.

Investment Properties

Investment properties, which are defined as property

held for rental income or capital appreciation, are

initially measured at cost being purchase price and

directly attributable expenditure. Where the intention is

to hold property as owner occupied, this is recognised as

property, plant and equipment.

Subsequently investment properties are held at cost

less accumulated depreciation and impairment losses.

Investment properties are depreciated between 15 years

straight line, other than the land element which is not

depreciated.

Fair values of the investment properties are disclosed.

FRASERS GROUP PLC ANNUAL REPORT 2022

123

Impairment of Assets Other Than Goodwill

At each balance sheet date, the Directors review the

carrying amounts of the Group’s tangible and intangible

assets, other than goodwill, to determine whether

there is any indication that those assets have suffered

an impairment loss. If any such indication exists, the

recoverable amount of the asset in its current condition

is estimated in order to determine the extent of the

impairment loss, if any. Where the asset does not

generate cash flows that are independent from other

assets, the Group estimates the recoverable amount of

the CGU to which the asset belongs. With respect to

property, plant and equipment, each store is considered

to be a CGU and reviewed for impairment whereby

changes in circumstances indicate that the recoverable

amount is lower than the carrying value.

The recoverable amount is the higher of fair value less

costs to sell and value in use. In assessing the value in

use, the estimated future cash flows are discounted to

their present value using a pre-tax discount rate that

reflects current market assessments of the time value of

money and the risks specific to the asset for which the

estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or CGU) is

estimated to be less than its carrying amount, the

carrying amount of the asset (CGU) is reduced to its

recoverable amount. An impairment loss is recognised

as an expense immediately, unless the relevant asset

is carried at a re-valued amount, in which case the

impairment loss is treated as a revaluation decrease to

the original historic cost and then as an expense.

Impairment losses recognised for CGU’s to which

goodwill has been allocated are credited initially to the

carrying amount of goodwill. Any remaining impairment

loss is charged pro rata to the other assets in the CGU.

Where an impairment loss subsequently reverses, the

carrying amount of the asset (CGU) excluding goodwill,

is increased to the revised estimate of its recoverable

amount, but so that the increased carrying amount does

not exceed the carrying amount that would have been

determined had no impairment loss been recognised

for the asset (CGU) in prior periods. A reversal of an

impairment loss is recognised in the Income Statement

immediately.

Assets Held for Sale

Non-current assets classified as held for sale are

presented separately and measured at the lower of

their carrying amounts immediately prior to their

classification as held for sale and their fair value less

costs to sell. Once classified as held for sale, the assets

are not subject to depreciation or amortisation.

Discontinued Operations

A discontinued operation is a component of the Group’s

business that represents a separate major line of

business or geographical area of operations that has

been disposed of or is held for sale, or is a subsidiary

acquired exclusively with a view to resale. Classification

as a discontinued operation occurs upon disposal or

when the operation meets the criteria to be classified as

held for sale, if earlier. When an operation is classified

as a discontinued operation, the results are presented

separately in the consolidated financial statements and

the comparative income statement is restated as if the

operation had been discontinued from the start of the

comparative period.

Inventories

Inventories are valued at the lower of cost and net

realisable value. Cost includes the purchase price of the

manufactured products, materials, direct labour and

transport costs. Cost is calculated using the weighted

average cost method. Net realisable value is based on

the estimated selling price less all estimated selling costs.

The Group receives trade discounts and rebates from

suppliers based upon the volume of orders placed in

a given time window. Typical discounts and rebates

received by the Group include early settlement discounts,

volume rebates on inventory purchases, supplier rebates

based on faulty goods, and marketing support. Where

there is sufficient certainty that a discount or rebate

will be received in the future that relates to historic

purchases this is reflected in the cost of inventories.

Where the receipt of rebates is uncertain, the cost of

inventories is held at full cost price until the rebate is

received. Recognised rebates are released to the Income

Statement to the extent that the stock has been sold.

Cash and Cash Equivalents

Cash and cash equivalents include cash in hand and

deposits held on call, together with other short term

highly liquid investments that are readily convertible to

known amounts of cash and which are subject to an

insignificant risk of changes in value.

Financial Instruments

Financial assets and financial liabilities are recognised in

the Group’s Balance Sheet when the Group becomes a

party to the contractual provisions of the instrument.

Financial assets and financial liabilities are initially

measured at fair value. Transaction costs that are

directly attributable to the acquisition or issue of

financial assets and financial liabilities (other than

financial assets and financial liabilities at fair value

through profit or loss) are added to or deducted from

the fair value of the financial assets or financial liabilities,

as appropriate, on initial recognition. Transaction costs

FRASERS GROUP PLC ANNUAL REPORT 2022

124

directly attributable to the acquisition of financial assets

or financial liabilities at fair value through profit or loss

are recognised immediately in profit or loss.

Financial assets are derecognised when the contractual

rights to the cash flows from the financial asset expire,

or when the financial asset and substantially all the

risks and rewards are transferred. A financial liability

is derecognised when it is extinguished, discharged,

cancelled or expires.

Financial Assets

Classification and initial measurement of financial assets

Except for those trade receivables that do not contain

a significant financing component and are measured

at the transaction price in accordance with IFRS 15,

all financial assets are initially measured at fair value

adjusted for transaction costs (where applicable).

Financial assets, other than those designated and

effective as hedging instruments, are classified into the

following categories:

• amortised cost

• fair value through profit or loss (FVTPL)

• fair value through other comprehensive

income (FVOCI)

All income and expenses relating to financial assets

that are recognised in profit or loss are presented within

finance costs or finance income, except for impairment

of trade receivables and amounts due from related

parties which are presented within selling distribution

and administrative expenses. Impairment losses in

respect of credit customer receivables are disclosed

separately on the face of the Income Statement.

The Group makes an assessment of the objective of

the business model in which a financial asset is held at

a portfolio level because this best reflects the way the

business is managed and information is provided to

management. The information considered includes:

• The stated policies and objectives for the portfolio

and the operation of those policies in practice.

These include whether management’s strategy

focuses on earning contractual interest income or

realising cash flows from the sale of assets;

• How the performance of the portfolio is evaluated

and reported to the Group’s management;

• The risks that affect the performance of the business

model and how those risks are managed;

• How managers of the business are compensated;

and

• The frequency, volume and timing of sales of

financial assets in prior periods, the reasons for such

sales and expectations about future sales activity.

For the purposes of this assessment, ‘principal’ is

defined as the fair value of the financial asset on initial

recognition. ‘Interest’ is defined as consideration for the

time value of money and for the credit risk associated

with the principal amount outstanding during a

particular period of time and for other basic lending risks

and costs (e.g. liquidity risk and administrative costs), as

well as a profit margin.

In assessing whether the contractual cash flows are

solely payments of principal and interest, the Group

considers the contractual terms of the instrument. This

includes assessing whether the financial asset contains

a contractual term that could change the timing or

amount of contractual cash flows such that it would

not meet this condition. In making this assessment, the

Group considers:

• contingent events that would change the amount or

timing of cash flows; and

• terms that may adjust the contractual coupon rate.

Subsequent Measurement of

Financial Assets

Financial assets at amortised cost

Financial assets are measured at amortised cost if

the assets meet the following conditions (and are not

designated as FVTPL):

• they are held within a business model whose

objective is to hold the financial assets and collect

its contractual cash flows; and

• the contractual terms of the financial assets give rise

to cash flows that are solely payments of principal

and interest on the principal amount outstanding.

After initial recognition, these are measured

at amortised cost using the effective interest

method. Discounting is omitted where the effect of

discounting is immaterial. The Group’s cash and cash

equivalents, trade and most other receivables fall into

this category of financial instruments.

Financial assets at fair value through profit or loss (FVTPL)

Financial assets that are held within a different business

model other than ‘hold to collect’ or ‘hold to collect and

sell’ are categorised at fair value through profit and

loss. Further, financial assets whose contractual cash

flows are not solely payments of principal and interest

are accounted for at FVTPL. All derivative financial

instruments fall into this category, except for those

designated and effective as hedging instruments, for

which the hedge accounting requirements apply

(see below).

FRASERS GROUP PLC ANNUAL REPORT 2022

125

Assets in this category are measured at fair value with

gains or losses recognised in profit or loss. The fair values

of financial assets in this category are determined

by reference to active market transactions or using a

valuation technique where no active market exists.

Financial assets at fair value through other comprehensive

income (FVOCI)

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) given these are not held for trading

purposes. 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.

Impairment of financial assets

IFRS 9’s impairment requirements use more forward-

looking information to recognise expected credit losses –

the ‘expected credit loss (ECL) model’. Instruments within

the scope of the requirements include trade receivables,

other receivables, amounts due from related parties,

loan commitments and some financial guarantee

contracts (for the issuer) that are not measured at fair

value through profit or loss.

Other receivables and amounts due from related parties

Recognition of credit losses is no longer dependent on

the Group first identifying a credit loss event. Instead

the Group considers a broader range of information

when assessing credit risk and measuring expected

credit losses, including past events, current conditions,

reasonable and supportable forecasts that affect the

expected collectability of the future cash flows of

the instrument.

In applying this forward-looking approach, a distinction

is made between:

• financial assets that have not deteriorated

significantly in credit quality since initial recognition

or that have low credit risk (‘Stage 1’);

• financial assets that have deteriorated significantly

in credit quality since initial recognition and whose

credit risk is not low (‘Stage 2’); and

• financial assets where the credit risk has increased

to a point at which it is considered credit impaired

(‘Stage 3’)

‘12-month expected credit losses’ are recognised for the

first category while ‘lifetime expected credit losses’ are

recognised for the second and third categories.

Measurement of the expected credit losses is

determined by a probability-weighted estimate of credit

losses over the expected life of the financial instrument.

Trade receivables

The Group makes use of a simplified approach in

accounting for trade receivables and records the loss

allowance as lifetime expected credit losses. These

are the expected shortfalls in contractual cash flows,

considering the potential for default at any point during

the life of the financial instrument. In calculating, the

Group uses its historical experience, external indicators

and forward-looking information to calculate the

expected credit losses using a provision matrix.

Credit customer receivables

12-month ECLs are used for Stage 1 performing assets

and a lifetime ECL is used for stages 2 and 3. An asset

will move from Stage 1 to Stage 2 when there is evidence

of significant increase in credit risk since the asset

originated and into Stage 3 when it is credit impaired.

Should the credit risk improve so that the assessment of

credit risk at the reporting date is considered not to be

significant any longer, assets return to an earlier stage in

the ECL model.

A financial asset is considered to have experienced a

significant increase in credit risk since initial recognition

where there has been a significant increase in the

remaining lifetime probability of default of the asset. The

Group assumes that the credit risk on a financial asset

has increased significantly if it is more than 30 days past

due, has been placed on an arrangement to pay less

than the standard required minimum payment (except

where a payment holiday was granted in response to

Covid-19) or has had interest suspended.

In line with IFRS 9, a financial asset is considered to be

in default when it is more than 90 days past due and/or

when the borrower is unlikely to pay its obligations in full.

Days past due are determined by counting the number

of days since the earliest elapsed due date in respect

of which the minimum payment has not been received.

Due dates are determined without considering any

grace period that might be available to the borrower.

When determining whether the credit risk of a

financial asset has increased significantly since initial

recognition and when estimating ECLs, the Group

considers reasonable and supportable information

that is relevant and available without undue cost or

effort. This includes both quantitative and qualitative

information and analysis based on the Group’s

historical experience and informed credit assessment

including forward looking information.

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The key assumptions in the ECL calculations are:

• Probability of Default (“PD”) - an estimate of the

likelihood of default over 12 months and the

expected lifetime of the debt;

• Exposure at Default (“EAD”) - an estimate of the

exposure at a future default date, taking into

account expected changes in the exposure after the

reporting date, including repayments of principal

and interest, whether scheduled by the contract

or otherwise and accrued interest from missed

payments; and

• Loss Given Default (“LGD”) - an estimate of the

loss arising in the case where a default occurs at a

given time. It is based on the difference between

the contractual cash flows due and those that the

Group would expect to receive, discounted at the

original effective interest rate. The key areas of

estimation are around the value that the Group will

recover in respect of the defaulted debt and the

timing of such recoveries.

The Group incorporates forward-looking information into

its measurement of ECLs. This is achieved by developing

four potential economic scenarios and modelling ECLs

for each scenario. The outputs from each scenario

are combined; using the estimated likelihood of each

scenario occurring to derive a probability weighted ECL.

Management judgement is required in setting

assumptions around probabilities of default and the

weighting of economic scenarios in particular which

have a material impact on the results indicated by the

ECL model.

Acquired loans that meet the Group’s definition of

default (i.e., those that are more than 90 days past

due and/or when the borrower is unlikely to pay

its obligations in full) at acquisition are treated as

purchased or originated credit-impaired (“POCI”) assets.

These assets attract a lifetime ECL allowance over the

full term of the loan, even when these loans no longer

meet the definition of default post acquisition. The

Group does not originate credit-impaired loans.

Loss allowances for financial assets are deducted

from the gross carrying amount of the asset.

Impairment losses related to Studio Retail’s

trade receivables are separately disclosed in the

consolidated income statement.

Financial Liabilities

Classification and measurement of financial liabilities

The Group’s financial liabilities include borrowings and

lease liabilities, trade and other payables and derivative

financial instruments.

Financial liabilities are initially measured at fair value,

and, where applicable, adjusted for transaction costs

unless the Group designated a financial liability at fair

value through profit or loss. Subsequently, financial

liabilities are measured at amortised cost using the

effective interest method except for derivatives and

financial liabilities designated at FVTPL, which are

carried subsequently at fair value with gains or losses

recognised in profit or loss (other than derivative

financial instruments that are designated and effective

as hedging instruments).

All interest-related charges and, if applicable, fair value

changes in currency derivative instruments that are

reported in profit or loss are included within finance

costs or finance income. Fair value changes in equity

derivative financial instruments are recognised in

investment income or investment costs.

Derivative financial instruments and hedge accounting

Derivative financial instruments are accounted for

at fair value through profit and loss (FVTPL) except

for derivatives designated as hedging instruments

in cash flow hedge relationships, which require a

specific accounting treatment. To qualify for hedge

accounting, the hedging relationship must meet all of

the following requirements:

• there is an economic relationship between the

hedged item and the hedging instrument;

• the effect of credit risk does not dominate the value

changes that result from that economic relationship;

and

• the hedge ratio of the hedging relationship is the

same as that resulting from the quantity of the

hedged item that the entity actually hedges and the

quantity of the hedging instrument that the entity

actually uses to hedge that quantity of hedged item.

Written option contracts do not qualify for hedge

accounting and fair value movements are recognised

directly in the Income Statement.

For the reporting periods under review, the Group

has designated certain forward currency contracts as

hedging instruments in cash flow hedge relationships.

These arrangements have been entered into to mitigate

foreign currency exchange risk arising from certain

highly probable sales and purchases transactions

denominated in foreign currencies.

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127

All derivative financial instruments used for hedge

accounting are recognised initially at fair value and

reported subsequently at fair value in the Balance Sheet.

To the extent that the hedge is effective, changes in

the fair value of derivatives designated as hedging

instruments in cash flow hedges are recognised in other

comprehensive income and included within the cash

flow hedge reserve in equity. Any ineffectiveness in the

hedge relationship is recognised immediately in profit

or loss.

At the time the hedged item affects profit or loss,

any gain or loss previously recognised in other

comprehensive income is reclassified from equity

to profit or loss and presented as a reclassification

adjustment within other comprehensive income.

However, if a non-financial asset or liability is recognised

as a result of the hedged transaction, the gains and

losses previously recognised in other comprehensive

income are included in the initial measurement of the

hedged item.

If a forecast transaction is no longer expected to

occur, any related gain or loss recognised in other

comprehensive income is transferred immediately

to profit or loss. If the hedging relationship ceases

to meet the effectiveness conditions or when the

relationship no longer meets the criteria for hedge

accounting, hedge accounting is discontinued and

the related gain or loss is held in the equity reserve

until the forecast transaction occurs.

Provisions

A provision is recognised when the Group has a present

legal or constructive obligation 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.

The Group provides for its legal responsibility for

dilapidation costs following advice from chartered

surveyors and previous experience of exit costs. The

estimated cost of fulfilling the leasehold dilapidations

obligations is discounted to present value and analysed

between non-capital and capital components. The

capital element is depreciated over the life of the

asset. The non-capital element is taken to the Income

Statement in the first year of the lease where the cost

it represents is of no lasting benefit to the Group or

its landlord. ‘Wear and tear’ costs are expensed to

the Income Statement. Provisions for onerous lease

contracts are recognised when the Group believes the

unavoidable costs of meeting the lease obligations

exceed the economic benefits expected to be received

under the lease. Legal provisions (including settlements

and court fees) are recognised based on advice from the

Group’s lawyers when it is probable that there will be an

outflow of resources and a reliable estimate can

be made.

Other provisions include management’s best estimate of

restructuring, employment related costs and other claims.

Any reimbursement that the Group is virtually certain to

collect from a third party with respect to the obligation

is recognised as a separate asset. However, this asset

may not exceed the amount of the related provision.

No liability is recognised if an outflow of economic

resources as a result of present obligations is not

probable. Such situations are disclosed as contingent

liabilities unless the outflow of resources is remote.

Leases

The Group assesses whether a contract is or contains

a lease, at inception of the contract. Lease liabilities

are measured at the present value of the contractual

payments due to the lessor over the lease term, with

the discount rate determined by reference to the rate

implicit in the lease unless (as is typically the case) this

is not readily determinable, in which case the Group’s

incremental borrowing rate on commencement of

the lease is used. Variable lease payments are only

included in the measurement of the lease liability if they

depend on an index or rate. In such cases, the initial

measurement of the lease liability assumes the variable

element will remain unchanged throughout the lease

term. Other variable lease payments such as revenue

linked property leases are expensed in the period to

which they relate.

On initial recognition, the carrying value of the lease

liability also includes:

• amounts expected to be payable under any residual

value guarantee;

• the exercise price of any purchase option granted

in favour of the Group if it is reasonably certain that

the option will be exercised; and

• any penalties payable for terminating the lease, if

the term of the lease has been estimated on the

basis of the termination option being exercised.

Subsequent to initial measurement lease liabilities

increase as a result of interest charged at the effective

rate on the balance outstanding and are reduced for

lease payments made.

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Right-of-use assets are initially measured at the amount

of the lease liability, reduced for any lease incentives

(payments made by a lessor to a lessee associated

with a lease, or the reimbursement or assumption by a

lessor of costs of a lessee) received or impairment, and

increased for:

• lease payments made at or before commencement

of the lease;

• initial direct costs incurred; and

• the amount of any provision recognised where

the Group is contractually required to dismantle,

remove or restore the leased asset, providing it

meets the Group’s property, plant and equipment

capitalisation policy.

When an indication of impairment is identified,

right-of-use assets are tested for impairment in

accordance with IAS 36 by comparing the recoverable

amount (higher of value in use and fair value less costs

of disposal) with its carrying amount. The right-of-use

assets are presented within property, plant and

equipment in the consolidated Balance Sheet.

Subsequent to initial measurement, right-of-use

assets are amortised on a straight-line basis over the

remaining term of the lease or over the remaining

economic life of the asset if this is judged to be shorter

than the lease term.

When the Group revises its estimate of the term of

any lease (because, for example, it re-assesses the

probability of a lessee extension or termination option

being exercised), it adjusts the carrying amount of the

lease liability to reflect the payments to make over the

revised term, which are discounted at a revised discount

rate. The carrying value of lease liabilities is revised using

the original discount rate when the variable element of

future lease payments dependent on a rate or index is

revised. In both cases an equivalent adjustment is made

to the carrying value of the right-of-use asset, with

the revised carrying amount being amortised over the

remaining (revised) lease term.

When the Group renegotiates the contractual terms of

a lease with the lessor, the accounting depends on the

nature of the modification:

• if the renegotiation results in one or more

additional assets being leased for an amount

commensurate with the standalone price for the

additional rights-of-use obtained, the modification

is accounted for as a separate lease in accordance

with the above policy

• in all other cases where the renegotiation increases

the scope of the lease (whether that is an extension

to the lease term, or one or more additional assets

being leased), the lease liability is remeasured using

the discount rate applicable on the modification

date, with the right-of use asset being adjusted by

the same amount

• if the renegotiation results in a decrease in the

scope of the lease, both the carrying amount of the

lease liability and right-of-use asset are reduced

by the same proportion to reflect the partial or

full termination of the lease with any difference

recognised in profit or loss. The lease liability is

then further adjusted to ensure its carrying amount

reflects the amount of the renegotiated payments

over the renegotiated term, with the modified lease

payments discounted at the rate applicable on the

modification date. The right-of-use asset is adjusted

by the same amount.

Sale and leaseback

On entering into a sale and leaseback transaction

the Group determines whether the transfer of the

assets qualifies as a sale (satisfying a performance

obligation in IFRS 15 ‘Revenue from Contracts with

Customers’). Where the transfer is a sale and providing

the transaction is on market terms then the previous

carrying amount of the underlying asset is split between:

• a right-of-use asset arising from the leaseback

(being the proportion of the previous carrying

amount of the asset that relates to the rights

retained), and

• the rights in the underlying asset retained by the

buyer-lessor at the end of the leaseback.

The Group recognises a portion of the total gain or loss

on the sale. The amount recognised is calculated by

splitting the total gain or loss into:

• an unrecognised amount relating to the rights

retained by the seller-lessee, and

• a recognised amount relating to the

buyer-lessor’s rights in the underlying asset at the

end of the leaseback.

The leaseback itself is then accounted for under IFRS 16.

Rental income from operating leases where the Group

acts as a lessor is recognised on a straight-line basis over

the term of the relevant lease.

Treasury Shares

The purchase price of the Group’s own shares that

it acquires is recognised as ‘Treasury shares’ within

equity. When shares are transferred out of treasury

the difference between the market value and the

average purchase price of shares sold out of treasury is

transferred to retained earnings.

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Employee Benefit Trust

An Employee Benefit Trust has been established for the

purposes of satisfying certain share-based awards. The

Group has ‘de-facto’ control over the special purpose

entity. This Trust is fully consolidated within the accounts.

The cost of shares acquired by the Sports Direct

Employee Benefit Trust is recognised within ‘Own Share

reserve’ in equity.

Share-Based Payments

The Group issues equity-settled share-based payments

to certain Directors and employees. These are measured

at fair value at the date of grant, which is expensed to

the consolidated Income Statement on a straight-line

basis over the vesting period, with the corresponding

credit going to equity.

Non-market vesting conditions are not taken into

account in determining grant date fair value. Instead,

they are taken into account by adjusting the number of

equity instruments to vest. At the end of each reporting

period the Group revises its estimates of the number

of options that are expected to vest based on the non

market vesting and service conditions. Any revisions, if

any, are recognised in profit and loss with an adjustment

to equity.

Fair value is calculated using an adjusted form of

the Black-Scholes model which includes a Monte

Carlo simulation model that takes into account the

exercise price, the term of the option, the impact of

dilution (where material), the share price at grant date

and the expected price volatility of the underlying

share, the expected dividend yield, and the risk-free

interest rate for the term of the scheme. The expected

staff numbers used in the model has been adjusted,

based on management’s best estimate, for the

effects of non-transferability, exercise restrictions, and

behavioural considerations.

For cash-settled share-based payment transactions, the

Group measures the services received and the liability

incurred at the fair value of the liability. Until the liability

is settled, the Group remeasures the fair value of the

liability at the end of each reporting period and at

the date of settlement, with any changes in fair value

recognised in the Income Statement for the period.

The credit for the share based payment charge does

not equal the charge per the Income Statement as it

excludes amounts recognised in the Balance Sheet in

relation to the expected national insurance contributions

for the shares.

Equity Instruments

An equity instrument is any contract that evidences

a residual interest in the assets of the Group after

deducting all of its liabilities. Equity instruments issued

by the Group are recorded at the proceeds received, net

of any direct issue costs.

Foreign Currencies

The presentational currency of the Group is sterling. The

functional currency of the Company is also sterling.

Foreign currency transactions are translated into sterling

using the exchange rates prevailing on the dates of the

transactions. Exchange differences of the Company

arising on the settlement of monetary items, and on

the retranslation of monetary items, are included in the

Income Statement for the period.

Exchange differences arising on the retranslation of

non-monetary items carried at fair value are included

in the Income Statement for the period except for

differences arising on the retranslation of non-monetary

items in respect of which gains and losses are

recognised in other comprehensive income. for such

non-monetary items, any exchange component of

that gain or loss is also recognised directly in other

comprehensive income. Monetary assets and liabilities

denominated in foreign currencies are translated at

the rate of exchange ruling at the balance sheet date.

Non-monetary items that are measured in terms of

historical cost in a foreign currency are not retranslated.

Non-monetary items that are held at valuation are

translated at the foreign exchange rate at the date of

the valuation.

On consolidation, the assets and liabilities of foreign

operations which have a functional currency other than

sterling are translated into sterling at foreign exchange

rates ruling at the balance sheet date. The revenues

and expenses of these subsidiary undertakings are

translated at average rates applicable in the period. All

resulting exchange differences are recognised in other

comprehensive income and documented in a separate

component of equity.

When a foreign operation is sold, the cumulative

exchange differences that have been recognised as

a separate component of equity are reclassified from

equity to the Income Statement when the disposal

is recognised.

In order to mitigate its exposure to certain foreign

exchange risks, the Group enters into forward and option

contracts (see Chief Executive’s Report and Business

Review and the cash flow hedging accounting policy).

Dividends

Dividends are recognised as a liability in the Group’s

Financial Statements and as a deduction from equity in

the period in which the dividends are declared. Where

such dividends are proposed subject to the approval of

shareholders, the dividends are regarded as declared

once shareholder approval has been obtained and they

are no longer at the discretion of the Company.

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130

Materiality

In preparing the Financial Statements, the Board

considers both quantitative and qualitative factors in

forming its judgements, and related disclosures, and

are mindful of the need to best serve the interests of its

stakeholders and to avoid unnecessary clutter borne of

the disclosure of immaterial items.

In making this assessment the Board considers the

nature of each item, as well as its size, in assessing

whether any disclosure omissions or misstatements

could influence the decisions of users of the

Financial Statements.

Post-employment obligations

For defined benefit plans, obligations are measured at

discounted present value (using the projected unit credit

method) and plan assets are recorded at fair value.

The operating and financing costs of such plans are

recognised separately in the Group Income Statement

and actuarial gains and losses are recognised in the

Group statement of comprehensive income/(loss).

Payments to defined contribution schemes are

recognised as an expense when they fall due.

Share buybacks

Share buybacks are undertaken from time to time.

Shares purchased are typically held in as Treasury

shares at the total consideration paid or payable. The

Group also uses contingent share purchase contracts

and irrevocable closed period buyback programmes;

the obligation to purchase shares is recognised in

full at the inception of the contract, even when that

obligation is conditional on the share price. Any

subsequent reduction in the obligation caused by the

expiry or termination of a contract is credited back

to equity at that time. No gain or loss is recognised

on the purchase, sale, issue or cancellation of the

Group’s own equity instruments.

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:

• Interest Rate Benchmark Reform – Phase 2 –

amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and

IFRS 16.

• COVID-19 related rent concessions beyond 30 June

2021 – amendment to IFRS 16.

• Configuration or Customisation Costs in a Cloud

Computing Arrangement (IAS 38 Intangible Assets) –

Agenda Paper 2.

• Amendments to IFRS 3, IAS 37, Annual improvements

cycle 2018-2020.

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 these consolidated

Financial Statements, there are no standards in

issue from the International Accounting Standards

Board (“IASB”) or International Financial Reporting

Interpretations Committee (“IFRIC”) which are effective

for annual accounting periods beginning on or after

25 April 2022 that will have a material impact on these

Financial Statements.

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 this 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.

The critical accounting estimates and judgements made

by the Group regarding the future or other key sources

of estimation, uncertainty and judgement that may have

a significant risk of giving rise to a material adjustment

to the carrying values of assets and liabilities within the

next financial period are:

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131

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 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. During the period the Group

has held greater than 20% of the voting rights of Studio

Retail Group Plc (Studio Retail Limited and certain

assets of Studio Retail Group Plc were acquired out of

administration during the period) and Mulberry Group

Plc, whereby management consider that the Group

does not have significant influence over these entities for

combinations of the following reasons:

• The Group does not have any representation on

the board of directors of the investee other than a

Frasers Group representative having an observer

role on the board of Studio Retail Group Plc before

it was acquired. Management have reviewed the

terms of the observer arrangement for the period

before acquisition and have concluded that this

did not give them the right to participate in or

influence the financial or operating decisions of

Studio Retail Group Plc. Studio Retail Group Plc

could terminate this arrangement at any time, and

could determine which parts of the Board meetings

the representative could be present at and what

information they were given access to. It should

be noted the Frasers Group representative did not

attend any board meetings in full or part during the

reporting period;

• There is no participation in decision making and

strategic processes, including participation in

decisions about dividends or other distributions;

• There have been no material transactions between

the entity and these investee companies;

• There has been no interchange of managerial

personnel;

• No non-public essential technical management

information is provided to the investee

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 effect 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.

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 £60.0m (£21.6m 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.

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132

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 and 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 growth assumptions

within them and are satisfied that forecasts in 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

£55.3m (FY21: £11.5m) would be shown in Finance Income.

Recognition of Defined Benefit

Pension Surplus

At 24 April 2022, the Group section of the Findel Group

Pension Fund (of which Studio Retail Limited is the

sponsoring employer) showed a surplus of £2.2m. This

surplus has been recognised in the Group’s consolidated

balance sheet. In recognising the surplus, management

exercised judgement as to whether Studio Retail Limited

(as sponsoring employer) has an unconditional right to

benefit from any pension surplus at some point in the

future (through refunds of surplus or reductions in future

contributions), in accordance with the requirements of

IFRIC 14. Management concluded that this was the case.

Key Estimates

Provision for Obsolete, Slow Moving or

Defective Inventories

The Directors have applied their knowledge and

experience of the retail industry in determining the level

and rates of provisioning required in calculating the

appropriate inventory carrying values. Specific estimates

and judgements applied in relation to assessing the

level of inventory provisions required are considered in

relation to the following areas:

A. Continuity inventory

B. Seasonal inventory lines – specifically seasons that

have now finished

C. Third party versus own brand inventory

D. Ageing of inventory

E. Sports Retail or Premium Lifestyle

F. Local economic conditions

G. Divisional specific factors

H. Increased cost of inventory and lower margins with

the devaluation of the Pound

I. Over-stock and out of season inventory as a result of

macro-economic factors

Provision estimates are forward looking and are formed

using a combination of factors including historical

experience, management’s knowledge of the industry,

group discounting, sales pricing protocols and the

overall assessment made by management of the risks

in relation to inventory. Management use a number of

internally generated reports to monitor and continually

re-assess the adequacy and accuracy of the inventory

provision. The additional cost of repricing inventory

and handling charges in relation to relocating inventory

(tunnelling) are considered in arriving at the appropriate

percentage provision. The assessment involves

significant estimation uncertainty, therefore in order

to check that the assumptions applied remain valid,

management produces a range of outcomes and the

provision is set within this range.

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133

Key assumptions used to create the estimates are:

• Discounting – Based on historical experience and

managements anticipated future discounting

including the continuing impact of the pandemic,

Brexit, global supply chain challenges and

macro-economic factors

• Tunnelling – Cost of handling stock for reworking

and repacking

• Repricing – Labour cost associated with repricing

units of stock

• Shrinkage – Stock lost through damage and theft

Total Group inventory provision at 24 April 2022 is

15.2% (FY21: 16.6%) of gross inventory. A 1% change

in the provision as a percentage of gross inventory

would impact profit before tax by approx. £15.5m (FY21:

£13.2m). Management do not consider it appropriate to

disclose sensitivities for key assumptions in isolation as

in practice changes in one assumption would lead to an

offset in another.

Property Related Provisions

Property related estimates and judgements are

continually evaluated and are based on historical

experience, external advice and other factors, including

expectations of future events that are believed to be

reasonable under the circumstances.

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 use a reference estimate of £100,000

(FY21: £100,000) for large leasehold stores, £50,000 (FY21:

£50,000) for smaller leasehold stores (£25,000 per store

for Game UK and Game Spain stores) and $/€50,000

(FY21: $/€50,000) for non-UK stores. 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.

A 10% increase in dilapidation cost per store would

result in an approx. £8.5m (FY21: £8.0m) reduction in

profit before tax.

Other 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 relate to management’s

best estimates of provisions required for legal and

regulatory claims and ongoing non-UK tax enquiries.

Other provisions relate to management’s best estimates

of provisions required for restructuring, employment and

commercial. Where applicable these are inclusive of any

estimated penalties, interest and legal costs.

In relation to the non-UK tax enquiries management

have made a judgement to consider all claims

collectively, applying the following key estimates to the

gross amounts (excluding re-imbursement assets):

• 10% penalty (FY21: 10%). A 5% increase to 15%

would result in approx. £6.5m increase in the

provision (FY21: approx. £6.5m increase).

• 3% interest on the liability (FY21: 3%). A 1% increase

to 4% would result in approx. £14m increase in the

provision (FY21: approx. £11.5m increase).

Management are satisfied that the judgement to

consider all claims collectively is the only reasonable

approach because they are all dependant on the

outcome of a court ruling on the interpretation of the

non-UK tax enquiries. Management are satisfied that

with regard to timing, a reasonable range of outcomes

are all greater than one year and so are satisfied with

including the provisions as non-current.

Detailed disclosures and sensitivities with regards to

financial services related provisions can be found in

note 29.

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.

FRASERS GROUP PLC ANNUAL REPORT 2022

134

Impairment of 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 synthetic 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 UK Europe Rest of World

Up to 5 years 1.4% - 2.6% 0.8% - 1.0% 1.5% - 2.9%

Greater than 5 years and up to 10 years 2.2% - 3.2% 1.2% - 1.9% 2.4% - 4.1%

Greater than 10 years and up to 20 years 2.5% - 3.4% 1.4% - 2.2% 2.9% - 4.3%

Greater than 20 years

2.8% - 3.5% 1.7% - 2.5% 3.5% - 4.6%

The right of use assets are assessed for impairment

at each reporting period in line with IAS 36 to review

whether the carrying amount exceeds its recoverable

amount. For impairment testing purposes 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.

Impairments in the period have been recognised for the

amount of £115.9m (FY21: £174.9m) due to the ongoing

challenges in the retail sector on the forecast cash

flows of the CGU, including supply chain issues and the

anticipated cost of living squeeze on customers. This is

broken down as follows:

• £76.8m (FY21: £168.2m) against the right-of-use asset

(£50.7m UK Sports Retail segment, £9.5m Premium

Lifestyle segment, £15.6m European Retail segment,

and £1.0m Rest of the World Retail segment); and

• £39.1m (FY21: £6.7m) against plant and equipment

(£28.7m UK Sports Retail segment, £10.4m Premium

Lifestyle segment).

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.

In line with IAS 36 Impairment of Assets, management

have considered whether any amounts should be

recognised for the reversal of prior period impairment

losses with £nil (FY21: £nil) being recognised in the period.

FRASERS GROUP PLC ANNUAL REPORT 2022

135

A sensitivity analysis has been performed in respect of sales, margin and the new store exemption as these are

considered to be the most sensitive of the key assumptions:

Forecast: Impact of change in assumption: Impairment increase / (decrease) (£'m)

Sales decline year 1

10% improvement

to 0%

(21.8)

Sales decline year 1

10% reduction

to 20%

17.9

Existing gross margin year 1 > 40% 100bps - improvement (4.2)

Existing gross margin year 1 > 40%

100bps - reduction 2.7

New store exemption

(1)

Change from

1 to 2 years

(27.2)

Operating costs increase year 1

Change from

6% to 10%

3.9

(1) Stores which have been open for less than one year are not reviewed for impairment.

B. Freehold land and buildings, long-term leasehold, investment property and associated plant

and equipment

Freehold land and buildings and long-term leasehold assets are assessed at each reporting period for whether there is

any indication of impairment in line with IAS 36.

An asset is impaired when the carrying amount exceeds its recoverable amount. 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.

Impairments in the period have been recognised in the amount of £111.1m (FY21: £117.9m) due to the ongoing

challenges in the retail sector on the forecast cash flows of the CGU. This is broken down as follows:

• £106.5m (FY21: £84.4m) against freehold land and buildings (£19.8m UK Sports Retail segment, £83.4m Premium

Lifestyle segment, £2.1m European Retail segment, and £1.2m Rest of World Retail segment);

• £2.0m (FY21: £3.9m) against long-term leasehold (£2.0m UK Sports Retail segment);

• £1.6m (FY21: £29.0m) plant and equipment (£1.2m UK Sports Retail segment, £0.2m Premium Lifestyle segment,

£0.2m European Retail segment); and

• £1.0m (FY21: £0.6m) investment property (all UK Sports Retail segment).

In line with IAS 36 Impairment of Assets, management have considered whether any amounts should be recognised

for the reversal of prior period impairment losses with £nil (FY21: £nil) being recognised in the period.

Value In Use (VIU)

The value in use is calculated based on a five year cash flow projections. These are formulated by using the Group’s

forecast cash flows of each individual CGU, taking into account historic performance of the CGU, and then adjusting

for the Group’s current 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.

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 Year 1 Year 2 Year 3 Year 4 Year 5

Sales decline -10% -5% -4% -3% -2%

Existing gross margin > 40% -200bps -175bps -150bps -125bps -100bps

Operating costs increase per annum 6% 3% 3% 3% 3%

Discount rate

7.5% 7.5% 7.5% 7.5% 7.5%

Terminal growth rate of 2%

A sensitivity analysis has been performed in respect of sales and margin as these are considered to be the most

sensitive of the key assumptions.

FRASERS GROUP PLC ANNUAL REPORT 2022

136

Forecast: Impact of: Impairment increase / (decrease) (£'m)

Sales year 1

10% improvement

to 0%

(16.8)

Sales year 1

10% reduction

to 20%

25.5

Existing gross margin year 1

> 40%

100bps - improvement (5.2)

Existing gross margin year 1

> 40%

100bps - reduction 6.7

Operating costs increase year 1

Change from

6% to 10%

9.1

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 in to 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 reflect the market to generate a net capital value. A deduction to

the capital value generated is then made based on the void period

with applicable rates payable for the unit and rent-free incentive.

Void period and rent free band – two bands

applied depending on circumstances:

• 1 year void, 2 years rent free; or

• 2 years void, 3 years rent free.

Yield bands – ranging from 5.5% - 14.0%

Frasers Group occupied Will be assumed the unit is vacant given there is no legally

binding inter-company agreement in place. Therefore, a void

and rent free incentive period assumed, the cost amount then

deducted from the capital value generated by the ERV and

reversionary yield. Although we consider the commercial reality

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.

Void period and rent free band – two bands

applied depending on circumstances:

• 1 year void, 2 years rent free; or

• 2 years void, 3 years rent free.

Yield bands – ranging from 5.5% - 14.0%

Third party tenanted An ERV is applied using a percentage band on the passing rent. An

appropriate 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 the current passing rent.

ERV is applied reflecting the market for the

applicable unit. An appropriate 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 the current passing rent.

A 10% increase in the market valuation amounts used in the impairment calculations would result in a decrease in

impairment of £5.0m (FY21: £7.5m).

The total recoverable amount of the assets that were impaired at the period end was £105.9m (FY21: £170.0m), with

£47.3m (FY21: £87.0m) of this being based on their fair value less costs of disposal and £58.6m (FY21: £83.0m) being

based on their value in use.

FRASERS GROUP PLC ANNUAL REPORT 2022

137

Credit Customer Receivables

Studio Retail Limited’s credit customer receivables are

recognised on balance sheet at amortised cost (i.e. net

of provision for expected credit loss). At 24 April 2022,

trade receivables with a gross value of £372.7m were

recorded on the balance sheet, less a provision for

impairment of £138.5m.

Fair value considerations

Management has concluded that the fair value of trade

receivables acquired broadly equated to their book

value and therefore that the difference on a go-forward

basis will not be material given that the nature of the

loan product offered (a revolving credit account) means

that the portfolio has a relatively short life (i.e. loans

with customers are repaid and replaced with fresh

loans under the revolving account). As a result of this,

management has concluded that it is appropriate to

recognise the trade receivables portfolio at the gross

book value less associated expected credit losses

(calculated by Studio Retail Limited) at acquisition, and

to apply the accounting policies for expected credit loss

that were in place at the point of the acquisition in the

Studio business on a go-forward basis.

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. Sensitivity analysis is given in note 23.

Post model adjustment

The impairment model was not designed to take into

account changes to customer payment and default

performance arising as a result of the current cost

of living crisis where levels of price inflation greatly

exceed income growth, as the existing model uses

unemployment rates as the principal determinant

in considering forward looking macro-economic

assumptions.

It is our expectation that SRL’s customer base has seen

and will continue to see a significant reduction in real

earnings as a result of the current cost of living crisis,

and that this will adversely impact payment and arrears

performance. It is also management’s view that these

anticipated impacts are not adequately reflected in

the output of the impairment model. Judgement has

therefore been exercised in applying a post model

adjustment of £40.0m to the output of the impairment

model in arriving at the provision. This adjustment was

included in the credit customer receivables provision

on acquisition of SRL and has been retained at period

end as this reflects management’s best estimate based

on the information available to them. The post model

adjustment was formulated based on an assessment

of the anticipated length of the cost of living crisis,

anticipated changes to default behaviour over that time

horizon, and credit bureau data assessing the level of

customer indebtedness.

The purpose of the post model adjustment is to ensure

that the probability weighted macroeconomic scenarios

adequately reflect the risks to customer payment and

default performance described above.

FRASERS GROUP PLC ANNUAL REPORT 2022

138

In arriving at the £40.0m estimate, a number of macro-economic scenarios were modelled based on the

considerations noted above and a probability weighting was applied to each scenario as follows:

Scenario Qualitative explanation

Probability weighting

applied

Upside Although real incomes are under pressure, households spend freely on hospitality, holidays and

entertainment, given the savings they’ve accumulated over the last 2 years, throughout the pandemic.

Those that were struggling before high inflation are likely experiencing financial difficulty. The

expectation is that the cost-of-living crisis is shorter under this scenario at between 12 and 18 months.

20%

Baseline The cost-of-living crisis intensifies with real incomes expected to be much lower in 2022 than they were

in 2021. The continued war in Ukraine puts prolonged pressure on global markets keeping inflation high,

with the expectation inflation will continue to rise throughout 2022. The longevity of the cost-of-living

crisis is assumed to last over 2 years.

60%

Downside The economy underperforms and the UK goes into a recession. The Bank of England continue to try

to address inflationary pressures with regular increases in base rate, pushing more households into

financial difficulty. Higher costs in Manufacturing and other sectors most exposed to the conflict in

Ukraine see a wave of insolvencies and subsequently an increase in unemployment. The impact is

expected to last up to 3 years.

10%

Stress The conflict in Ukraine escalates and economic sanctions damage western economies. With continued

labour shortages and problems in supply-chains, this perfect storm of shock sees inflation rise sharply. As

well as the impact on real incomes, the rise in inflation unsettles markets and leads to a crash in asset

values. Whilst not explicitly modelled this scenario would also cover another emerging Covid-19 variant,

more resistant to vaccines leading to a severe outcome and further lockdowns. The impact is expected to

last over 3 years.

10%

We note that the unprecedented level of uncertainty around the cost of living and the UK economy as a whole,

and the impact this will have on Studio’s customer base, will continue cause challenges in assessing bad debt on a

forward-looking basis.

£9.1m of the trade receivables acquired were categorised as Stage 3 by Studio and would likely meet the Group’s

definition of purchased credit-impaired (“POCI”). On the basis of materiality, and that the loans would attract a

lifetime ECL allowance whether categorised as Stage 3 or POCI, we have chosen to continue to apply Studio’s

classification and measurement of these loans as Stage 3 in the consolidated financial statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

139

3. FINANCIAL RISK

MANAGEMENT

The Group’s current activities result in the following

financial risks and set out below are management’s

responses to those risks in order to minimise any

resulting adverse effects on the Group’s financial

performance.

Foreign Exchange Risk

The Group is exposed to foreign exchange risk

principally via:

A. Transactional exposure from the cost of future

purchases of goods for resale, where those

purchases are denominated in a currency other than

the functional currency of the purchasing company.

Transactional exposures that could significantly

impact the income statement are hedged. These

exposures are hedged via forward foreign currency

contracts which are designated as cash flow hedges.

The notional and fair value of these contracts is

shown in note 30;

B. Transactional exposure from the sale of goods,

where those sales are denominated in a currency

other than the functional currency of the selling

company. Transactional exposures that could

significantly impact the income statement are

hedged. These exposures are hedged via forward

foreign currency contracts which are designated

as cash flow hedges. The notional and fair value of

these contracts is shown in note 30;

C. Loans to non-UK subsidiaries. These are hedged

via foreign currency transactions and borrowings

in matching currencies, which are not formally

designated as hedges, as gains and losses on

hedges and hedged loans will naturally offset; and

D. The Group 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 Financial

Instruments. Exposures in respect of written

options to sell Euros or buy USD are explained in

the Financial Review. These are not hedged and

movements in fair value could significantly impact

the Income Statement in future periods. See note 30.

Interest Rate Risk

The Group has net borrowings, which are principally

at floating interest rates linked to bank base rates

or SONIA. The Group uses interest rate financial

instruments to hedge its exposure to interest rate

movements using interest rate swaps although hedge

accounting is not applied. The Group regularly monitors

and reacts accordingly to any exposure to fluctuations in

interest rates and the impact on its monetary assets

and liabilities.

Credit Risk

The Directors have a credit policy in place and the

exposure to credit risk is monitored on an ongoing

basis. Credit evaluations are performed on all customers

requiring credit over a certain amount. The Group does

not require collateral in respect of financial assets.

At each balance sheet date, there were no significant

concentrations of credit risk. The maximum exposure to

credit risk is represented by the carrying amount of each

financial asset in the balance sheet.

Investments of cash surpluses, borrowings and derivative

instruments are made through banks and companies

which must fulfil credit rating and investment criteria

approved by the Board.

Liquidity Risk

The Group has sufficient liquid resources to manage

the operating requirements of the business and it does

this through utilisation of its revolving credit facilities

together with equity and retained profits thereby

achieving continuity of funding and short-term flexibility,

while keeping interest to a minimum.

Management regularly review forecasts to ensure there

is adequate headroom on the facilities and to ensure the

Group is operating within its financial covenants.

FRASERS GROUP PLC ANNUAL REPORT 2022

140

Price Risk

The Group is exposed to price risk in respect of

its long term financial assets (in relation to listed

company shares).

The price risk relates to volatility in the market, and

how other comprehensive income and equity would

have been affected by changes in market risk that were

reasonably possible at the reporting date. If the quoted

stock price for these securities increased or decreased,

other comprehensive income and equity would have

changed. The listed securities are classified as long term

investments at fair value through other comprehensive

income so there would be no effect on profit or loss.

The investments in listed equity securities (long-term

financial assets) are considered medium to long-term

strategic investments. In accordance with the Group’s

policies, no specific hedging activities are undertaken in

relation to these investments.

Capital Management

A description of the Group’s objectives, policies and

processes for managing capital are included in note 30.

4. SEGMENTAL ANALYSIS

Management has determined to present its segmental

disclosures consistently with the presentation in the 2021

Annual Report. Management considers operationally

that the UK Retail divisions (UK Sports Retail and

Premium Lifestyle) are run as one business unit in terms

of allocating resources, inventory management and

assessing performance. Under IFRS 8 we have not at

this reporting date met the required criteria with enough

certainty to aggregate these operating segments. We

will continually keep this under review at subsequent

reporting dates. We continue to monitor the impacts

of Covid-19, Brexit, and the continued uncertainties

this has brought relating to the political and economic

environments, and market and currency volatility in

the countries we operate in. European countries have

been identified as operating segments and have

been aggregated into a single operating segment as

permitted under IFRS 8. The decision to aggregate

these segments was based on the fact that they each

have similar economic characteristics, similar long-term

financial performance expectations, and are similar in

each of the following respects:

• The nature of the products;

• The type or class of customer for the products; and

• The methods used to distribute the products.

In accordance with paragraph 12 of IFRS 8 the Group’s

operating segments have been aggregated into the

following reportable segments:

1. UK Retail:

i. UK Sports Retail - includes core sports retail

store operations in the UK, plus all the Group’s

sports retail online business (excluding Bob’s

Stores, Eastern Mountain Sports, Malaysia

and Baltics), the gyms, the Group’s Shirebrook

campus operations, freehold property owning

companies excluding Premium Lifestyle

fascia properties, GAME UK stores and

online operations, Studio Retail Limited (from

acquisition on 24 February 2022) and retail

store operations in Northern Ireland.

ii. Premium Lifestyle – includes the results of the

premium and luxury retail businesses Flannels,

Cruise, van mildert, Jack Wills, House of Fraser

and Sofa.com along with related websites, and

freehold property owning companies where

trading is purely from Premium Lifestyle fascias.

2. European Retail - includes all the Group’s sports

retail stores, management and operations in Europe

including the Group’s European Distribution Centres

in Belgium and Austria, European freehold property

owning companies, as well as GAME Spain stores

and Baltics online.

3. Rest of World Retail – includes the results of US

based retail activities, Asia based retail activities

along with their e-commerce offerings.

4. Wholesale & Licensing – includes the results of

the Group’s portfolio of internationally recognised

brands such as Everlast, Karrimor, Lonsdale

and Slazenger.

It is management’s current intention to run the Group

as four operating segments being UK Retail (including

UK Sports Retail and Premium Lifestyle), European

Retail, Rest of World Retail and Wholesale & Licensing.

Management is satisfied that the UK Sports Retail and

Premium Lifestyle will meet the criteria permitted under

IFRS 8 to aggregate as one segment in due course.

The FY21 numbers have been re-categorised due to

changes in the reporting segments, with freehold

property owning companies where trading is purely

from Premium Lifestyle fascias being moved from UK

Sports Retail to Premium Lifestyle. Adjustments for IFRS

16, which were previously reported as a reconciling

item, have been included within Operating profit before

foreign exchange, exceptional items and property and

other related impairments to be consistent with the

presentation adopted for FY22.

FRASERS GROUP PLC ANNUAL REPORT 2022

141

Segmental information for the 52 weeks ended 24 April 2022:

UK Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale &

Licensing Eliminations

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Sales to external customers

2,640.1 1,056.6 3,696.7 790.2 150.3 4,637.2 168.1 - 4,805.3

Sales to other segments

- - - - - - 80.1 (80.1) -

Revenue

2,640.1 1,056.6 3,696.7 790.2 150.3 4,637.2 248.2 (80.1) 4,805.3

Gross profit

1,136.8 474.8 1,611.6 337.3 76.7 2,025.6 63.1 - 2,088.7

Operating profit before foreign

exchange, exceptional items

and property and other related

impairments

289.4 124.0 413.4 109.8 34.4 557.6 6.9 - 564.5

Exceptional items

(1.3) - (1.3) - - (1.3) - - (1.3)

Property and other

related impairments

(103.4) (103.5) (206.9) (17.9) (2.2) (227.0) - - (227.0)

Realised foreign exchange loss

(1.1) (0.1) (1.2) (2.9) (0.8) (4.9) (0.9) - (5.8)

Operating profit

183.6 20.4 204.0 89.0 31.4 324.4 6.0 - 330.4

Investment income

43.8 - 43.8 - - 43.8 - - 43.8

Investment costs

(19.7) - (19.7) - - (19.7) - - (19.7)

Finance income

(1)

36.8 - 36.8 1.0 1.0 38.8 - (8.5) 30.3

Finance costs

(1)

(42.8) (10.0) (52.8) (4.4) (0.5) (57.7) - 8.5 (49.2)

Profit before taxation

201.7 10.4 212.1 85.6 31.9 329.6 6.0 - 335.6

Taxation

(78.7)

Profit for the period

256.9

(1) Includes inter-company related finance income in UK Sports Retail and the equivalent finance cost in Premium Lifestyle that eliminates on consolidation.

Following the acquisition of Studio Retail Limited, sales to external customers includes credit account interest of £18.2m,

and gross profit includes impairment losses on credit customer receivables of £13.3m, both of which are recognised in

the UK Sports segment. The gain on bargain purchase arising from the acquisition of Studio Retail Limited of £4.8m

(see note 32) has been recognised in gross profit in the UK Sports segment.

Other segment items included in the income statement for the 52 weeks ended 24 April 2022:

UK Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale &

Licensing

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Property, plant & equipment depreciation

122.2 22.9 145.1 20.2 2.4 167.7 1.3 169.0

Property, plant & equipment impairment

51.7 94.0 145.7 2.3 1.2 149.2 - 149.2

IFRS 16 ROU depreciation

47.8 6.4 54.2 19.9 3.1 77.2 0.4 77.6

IFRS 16 ROU impairment

50.7 9.5 60.2 15.6 1.0 76.8 - 76.8

Investment property depreciation

5.9 - 5.9 - - 5.9 - 5.9

Investment property impairment

1.0 - 1.0 - - 1.0 - 1.0

IFRS 16 disposal and modification/remeasurement

of lease liabilities

14.2 3.9 18.1 9.2 1.0 28.3 - 28.3

Intangible amortisation

1.0 - 1.0 - - 1.0 6.5 7.5

Intangible impairment

1.3 - 1.3 - - 1.3 4.4 5.7

FRASERS GROUP PLC ANNUAL REPORT 2022

142

Information regarding segment assets and liabilities as at 24 April 2022 and capital expenditure for the 52 weeks

then ended:

UK Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale &

Licensing Eliminations

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Total assets

4,161.9 1,002.1 5,164.0 485.5 84.4 5,733.9 349.7 (1,940.9) 4,142.7

Total liabilities

(2,908.9) (1,098.9) (4,007.8) (681.4) 7.6 (4,681.6) (93.4) 1,940.9 (2,834.1)

Tangible asset additions

228.1 63.6 291.7 29.4 1.3 322.4 0.8 - 323.2

Right of use asset additions

27.8 25.0 52.8 43.0 4.7 100.5 0.4 - 100.9

Intangible assets acquired

7.0 - 7.0 - - 7.0 - - 7.0

Segmental information for the 52 weeks ended 25 April 2021

(1)

UK Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale &

Licensing Eliminations

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Sales to external customers

1,968.5 735.6 2,704.1 615.2 152.7 3,472.0 153.3 - 3,625.3

Sales to other segments

- - - - - - 95.4 (95.4) -

Revenue

1,968.5 735.6 2,704.1 615.2 152.7 3,472.0 248.7 (95.4) 3,625.3

Gross profit

829.3 330.3 1,159.6 239.7 64.0 1,463.3 67.5 - 1,530.8

Operating profit before foreign

exchange, exceptional items

and property and other related

impairments

191.0 34.3 225.3 20.5 18.6 264.4 20.2 - 284.6

Exceptional items

3.1 (1.6) 1.5 (3.1) - (1.6) - - (1.6)

Realised foreign exchange (loss)

/ gain

(20.2) (0.2) (20.4) 0.8 (1.4) (21.0) (5.3) - (26.3)

Property and other related

impairments

(201.9) (40.9) (242.8) (71.6) (2.6) (317.0) - - (317.0)

Operating (loss)/profit

(28.0) (8.4) (36.4) (53.4) 14.6 (75.2) 14.9 - (60.3)

Investment income

103.7 - 103.7 - - 103.7 - - 103.7

Investment costs

(7.7) - (7.7) - - (7.7) - - (7.7)

Finance income

6.5 - 6.5 2.5 - 9.0 - - 9.0

Finance costs

(28.1) (1.2) (29.3) (2.7) (3.8) (35.8) (0.4) - (36.2)

Profit before taxation

46.4 (9.6) 36.8 (53.6) 10.8 (6.0) 14.5 - 8.5

Taxation

(86.5)

Loss for the period

(78.0)

(1) The FY21 numbers have been re-categorised due to changes in the reporting segments, with freehold property owning companies where trading is purely from

Premium Lifestyle fascias being moved from UK Sports Retail to Premium Lifestyle.

Inter-segment sales are priced at cost plus a 10% mark-up.

Other segment items included in the income statement for the 52 weeks ended 25 April 2021

(1)

Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale

& Licensing

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Property, plant & equipment depreciation

131.9 42.3 174.2 35.3 5.7 215.2 1.2 216.4

Property, plant & equipment impairment

87.2 20.4 107.6 40.6 - 148.2 - 148.2

IFRS 16 ROU depreciation

51.5 6.4 57.9 21.9 2.3 82.1 - 82.1

IFRS 16 ROU impairment

114.1 20.5 134.6 31.0 2.6 168.2 - 168.2

Investment property depreciation

1.9 - 1.9 - - 1.9 - 1.9

Investment property impairment

0.6 - 0.6 - - 0.6 - 0.6

IFRS 16 disposal and modification/remeasurement

of lease liabilities

(20.0) (5.6) (25.6) (1.4) (0.7) (27.7) - (27.7)

Intangible amortisation

- - - 0.5 - 0.5 6.6 7.1

Intangible impairment

3.7 2.3 6.0 3.1 - 9.1 - 9.1

(1) The FY21 numbers have been re-categorised due to changes in the reporting segments, with freehold property owning companies where trading is purely from

Premium Lifestyle fascias being moved from UK Sports Retail to Premium Lifestyle.

FRASERS GROUP PLC ANNUAL REPORT 2022

143

Information regarding segment assets and liabilities as at 25 April 2021

(1)

and capital expenditure for the

52 weeks then ended:

UK Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale &

Licensing Eliminations

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Total assets

3,305.9 668.0 3,973.9 670.8 158.6 4,803.3 344.7 (1,362.9) 3,785.1

Total liabilities

(2,357.8) (499.6) (2,857.4) (857.0) (95.1) (3,809.5) (127.5) 1,362.9 (2,574.1)

Tangible asset additions

163.4 33.1 196.5 17.4 3.0 216.9 2.5 - 219.4

Right of use asset additions

77.5 14.1 91.6 24.3 2.4 118.3 0.5 - 118.8

Intangible asset additions/acquired

3.7 2.3 6.0 - - 6.0 1.0 - 7.0

(1) The FY21 numbers have been re-categorised due to changes in the reporting segments, with freehold property owning companies where trading is purely from

Premium Lifestyle fascias being moved from UK Sports Retail to Premium Lifestyle.

Geographic Information

Segmental information for the 52 weeks ended 24 April 2022:

UK Europe USA Asia Eliminations Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Segmental revenue from

external customers

3,714.8 823.0 223.0 44.5 - 4,805.3

Total capital expenditure

291.7 29.4 0.9 1.2 - 323.2

Non-current segment

assets*

962.2 130.3 126.0 4.5 - 1,223.0

Total segmental assets

5,486.8 381.3 176.3 39.2 (1,940.9) 4,142.7

*Excludes deferred tax and financial instruments.

Segmental information for the 52 weeks ended 25 April 2021:

UK Europe USA Asia Eliminations Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Segmental revenue from

external customers

2,721.7 646.2 213.7 43.7 - 3,625.3

Total capital expenditure

196.5 17.4 3.2 2.3 - 219.4

Non-current segment

assets*

1,052.3 114.9 127.7 4.6 - 1,299.5

Total segmental assets

4,264.7 589.2 256.2 37.9 (1,362.9) 3,785.1

*Excludes deferred tax and financial instruments.

Material non-current segmental assets – by a non-UK country:

USA Belgium Austria Estonia Ireland Spain

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

FY22

126.0 58.4 19.5 0.7 13.3 33.4

FY21

127.7 46.8 22.4 - 12.9 39.9

Material segmental revenue from external customers – by a non-UK country:

USA Belgium Austria Estonia Ireland Spain

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

FY22

223.0 113.3 38.3 118.5 172.6 229.4

FY21

213.7 93.1 42.1 96.7 95.4 208.1

Note the Group has no individual customer which accounts for more than 10% of revenue in the current or prior period.

FRASERS GROUP PLC ANNUAL REPORT 2022

144

The following tables reconciles the Profit Before Tax to the Adjusted PBT as it is one of the main measures used by the

Chief Operating Decision Maker when reviewing the performance of the segment:

Reconciliation of Reported PBT to Adjusted PBT for the 52 week period ended 24 April 2022:

UK Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale &

Licensing

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Reported PBT

201.6 10.4 212.0 85.7 31.9 329.6 6.0 335.6

Exceptional Items

1.3 - 1.3 - - 1.3 - 1.3

Fair value adjustments to derivative

financial instruments

(7.6) - (7.6) - - (7.6) - (7.6)

Fair value (gains)/losses and profit on disposal

of equity derivatives

(9.9) - (9.9) - - (9.9) - (9.9)

Realised FX loss

1.1 0.1 1.2 2.9 0.8 4.9 0.9 5.8

Share scheme

10.4 - 10.4 - - 10.4 4.2 14.6

Adjusted PBT

196.9 10.5 207.4 88.6 32.7 328.7 11.1 339.8

Reconciliation of Reported PBT to Adjusted PBT for the 52 week period ended 25 April 2021

(1)

UK Sports

Premium

Lifestyle

UK Retail

Total

European

Retail

Rest of

World Retail

Total

Retail

Wholesale &

Licensing

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Reported PBT

46.4 (9.6) 36.8 (53.6) 10.8 (6.0) 14.5 8.5

Exceptional items

(3.1) 1.6 (1.5) 3.1 - 1.6 - 1.6

Fair value adjustment to derivative

financial instruments

4.6 - 4.6 - - 4.6 - 4.6

Fair value (gains)/losses and profit on disposal

of equity derivatives

(82.2) - (82.2) - - (82.2) - (82.2)

Realised FX loss / (gain)

20.2 0.2 20.4 (0.8) 1.4 21.0 5.3 26.3

Share scheme

1.3 - 1.3 - - 1.3 - 1.3

Adjusted PBT

(12.8) (7.8) (20.6) (51.3) 12.2 (59.7) 19.8 (39.9)

(1) The FY21 numbers have been re-categorised due to changes in the reporting segments, with freehold property owning companies where trading is purely from

Premium Lifestyle fascias being moved from UK Sports Retail to Premium Lifestyle.

5. OTHER OPERATING INCOME

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Rent receivable

27.3 16.1

Other

20.7 20.7

48.0 36.8

Other operating income relates to charges for aircraft, lease surrender premiums, ad hoc income and sundry charges

to third parties.

FRASERS GROUP PLC ANNUAL REPORT 2022

145

6. EXCEPTIONAL ITEMS

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Impairments

(1.3) (9.1)

Profit on disposal of intangible assets

- 7.5

(1.3) (1.6)

The impairment in both the current and prior period relates to goodwill, whereby the discounted present value of

future cash flows do not support the full value of the assets. The profit on disposal of intangible assets in the prior

period relates to the sale of certain IP relating to the BELONG business.

7. PROFIT ON SALE OF PROPERTIES

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Profit on sale of properties

10.8 9.7

The profit on the sale of properties in the current period includes gains on the sale of UK properties

(FY21: European properties).

8. OPERATING PROFIT/(LOSS) FOR THE PERIOD

Operating profit/(loss) for the period is stated after charging/(crediting):

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Foreign exchange loss

5.8 26.3

Depreciation and amortisation of non-current assets:

- Depreciation of property, plant & equipment (incl. right-of-use asset)

246.6 298.5

- Impairment of property, plant & equipment (incl. right-of-use asset)

226.0 316.4

- Depreciation of investment properties

5.9 1.9

- Impairment of investment properties

1.0 0.6

- Amortisation of intangible assets

7.5 7.1

- Impairment of intangible assets

5.7 9.1

IFRS 16 leases:

Profit on disposal and modification/ remeasurement of lease liabilities

(28.3) (27.7)

Variable lease payments

14.0 25.5

Short term and low value

lease expenses

25.0 31.6

FRASERS GROUP PLC ANNUAL REPORT 2022

146

Services Provided by the Group’s Auditor

The remuneration of the auditors, RSM UK Audit LLP, and associated firms, was as detailed below:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

AUDIT SERVICES

Audit of the Group and company - recurring

1.8 1.5

Audit of the Group and company - non-recurring

- 0.1

Audit of subsidiary companies

1.0 0.8

2.8 2.4

There were no non-audit services provided by RSM UK Audit LLP and associated firms in either the current or

prior period.

9. PAYROLL COSTS

The average monthly number of employees, including Executive Directors, employed by the Group during the

period was:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

Retail stores

23,971 22,122

Distribution, administration and other

6,382 4,374

30,353 26,496

The increase in employees is mainly due to acquisitions and the ongoing organic growth of the business.

The aggregate payroll costs of the employees, including Executive Directors, net of amounts received from

Government grants, were as follows:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Wages and salaries

491.5 342.2

Social security costs

34.9 29.3

Pension costs

6.5 5.6

532.9 377.1

Aggregate emoluments of the Directors of the Company are summarised below:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

Aggregate emoluments

0.6 0.5

Further details of Directors’ remuneration are given in the Directors’ Remuneration Report. Details of key management

remuneration are given in note 35.

FRASERS GROUP PLC ANNUAL REPORT 2022

147

10. INVESTMENT INCOME

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Profit on disposal of equity derivatives

23.2 27.4

Premium received on equity derivatives

13.2 13.3

Fair value gain on equity derivatives

6.4 62.5

Dividend income

1.0 0.5

43.8 103.7

The profit on disposal of equity derivatives mainly relates to Hugo Boss contracts for difference. The fair value gain on

equity derivatives mainly relates to Hugo Boss options. The premium received on equity derivatives mainly relates to

Hugo Boss options.

11. INVESTMENT COSTS

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Fair value loss on equity derivatives

19.7 7.7

The fair value loss on equity derivatives in the current period mainly relates to Hugo Boss contracts for difference.

12. FINANCE INCOME

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Bank interest receivable

4.5 3.5

Interest on retirement benefit obligations

0.1 -

Other finance income

1.7 5.5

Fair value adjustment to derivatives

24.0 -

30.3 9.0

The fair value adjustment to derivatives largely relates to movement in the fair value of interest rate swaps.

FRASERS GROUP PLC ANNUAL REPORT 2022

148

13. FINANCE COSTS

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Interest on bank loans and overdrafts

13.6 11.1

Other interest

7.0 8.6

Interest on retirement benefit obligations

- 0.1

IFRS 16 lease interest

12.2 11.8

Fair value adjustment to derivatives

16.4 4.6

49.2 36.2

The fair value adjustment to derivatives relates to differences between the fair value of forward foreign currency

contracts and written options that were not designated for hedge accounting from one period end to the next.

14. TAXATION

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Current tax

86.2 83.2

Adjustment in respect to prior periods

(5.7) 13.6

Total current tax

80.5 96.8

Deferred tax

(8.5) (10.1)

Adjustment in respect of prior periods

6.7 (0.2)

Total deferred tax (see note 28)

(1.8) (10.3)

78.7 86.5

Profit before taxation

335.6 8.5

Taxation at the standard rate of tax in the UK of 19% (2021: 19%)

63.8 1.6

Non-taxable income

(14.4) (3.9)

Expenses not deductible for tax purposes

62.4 77.0

Other tax adjustments

(15.6) (1.6)

Adjustments in respect of prior periods - current tax

(5.7) 13.6

Adjustments in respect of prior periods - deferred tax

6.7 (0.2)

Changes in deferred tax rate

(18.5) -

78.7 86.5

Non-taxable income largely relates to differences between capital allowances and depreciation which are not

timing differences on which deferred tax is provided. Expenses not deductible for tax purposes largely relates to

non-qualifying depreciation and impairments not qualifying for tax allowances.

FRASERS GROUP PLC ANNUAL REPORT 2022

149

15. 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, 471,975,282 (FY21: 501,955,281), is adjusted to

assume conversion of all dilutive potential ordinary shares under the Group’s share schemes, being nil (FY21: 88,605),

to give the diluted weighted average number of shares of 471,975,282 (FY21: 502,043,886). In FY21, as there was a loss

for the period, the effect of potentially dilutive ordinary shares was anti-dilutive, and therefore the weighted average

number of shares for the Diluted EPS calculation was kept the same as for the Basic EPS calculation. There is therefore

no difference between the Basic and Diluted EPS calculations for both periods.

Basic and Diluted Earnings Per Share

52 weeks ended

24 April 2022

Basic and diluted,

continuing

operations

52 weeks ended

24 April 2022

Basic and diluted,

discontinued

operations

52 weeks ended

24 April 2022

Basic and diluted,

total

52 weeks ended

25 April 2021

Basic and diluted,

continuing

operations

52 weeks ended

25 April 2021

Basic and diluted,

discontinued

operations

52 weeks ended

25 April 2021

Basic and diluted,

total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Profit for the period 224.1 25.7 249.8 (91.6) 8.6 (83.0)

Number in

thousands

Number in

thousands

Number in

thousands

Number in

thousands

Number in

thousands

Number in

thousands

Weighted average number

of shares

471,975 471,975 471,975 501,955 501,955 501,955

Pence per share Pence per share Pence per share Pence per share Pence per share Pence per share

Earnings per share 47.5 5.4 52.9 (18.2) 1.7 (16.5)

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/

(loss) 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

24 April 2022

Basic

52 weeks ended

24 April 2022

Diluted

52 weeks ended

25 April 2021

Basic

52 weeks ended

25 April 2021

Diluted

(£’m) (£’m) (£’m) (£’m)

Profit / (loss) for the period 249.8 249.8 (83.0) (83.0)

Pre-tax adjustments to profit / (loss) for the period for the following items:

Exceptional items 1.3 1.3 1.6 1.6

Fair value adjustment to derivatives included within

Finance (income) / costs

(7.6) (7.6) 4.6 4.6

Fair value gains and profit on disposal of equity derivatives (9.9) (9.9) (82.2) (82.2)

Realised foreign exchange loss 5.8 5.8 26.3 26.3

Share scheme 14.6 14.6 1.3 1.3

Tax adjustments on the above items 0.3 0.3 (5.9) (5.9)

Adjusted profit / (loss) for the period 254.3 254.3 (137.3) (137.3)

Number in

thousands

Number in

thousands

Number in

thousands

Number in

thousands

Weighted average number of shares 471,975 471,975 501,955 501,955

Pence per share Pence per share Pence per share Pence per share

Adjusted Earnings per share 53.9 53.9 (27.3) (27.3)

FRASERS GROUP PLC ANNUAL REPORT 2022

150

16. DISCONTINUED OPERATIONS

Subsequent to the period end, on 24 May 2022, the Group disposed of its US retail businesses trading as Bobs Stores

and Eastern Mountain Sports for cash consideration of $70.0m (approx. £56.1m). The disposal took place through sale

of 100% of the share capital of Roberts 50 USA LLC and its subsidiaries to GoDigital Media Group. These businesses

are reported as part of the Rest of World operating segment.

As per IFRS 5 Non-current Assets Held for Sale and Discontinued Operations, this disposal group has been classified as

held for sale and as a discontinued operation. A profit on disposal of approx. £30.0m will be recognised in FY23.

The following major classes of assets and liabilities relating to the disposal group have been classified as held for sale

in the consolidation balance sheet as at

24 April 2022:

24 April 2022

(£’m)

Inventories 37.7

Trade and other receivables 2.3

Assets held for sale 40.0

Trade and other payables 10.6

Provisions 3.2

Lease liabilities 8.9

Liabilities held for sale 22.7

The Cash Flow Statement includes the following amounts relating to this discontinued operation:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£’m) (£’m)

Operating activities 4.2 6.9

Financing activities (6.1) (9.9)

Net cash outflow from discontinued operations (1.9) (3.0)

FRASERS GROUP PLC ANNUAL REPORT 2022

151

17. PROPERTY, PLANT AND EQUIPMENT

Right of

use asset

Freehold land and

Buildings

Long-term

Leasehold

Short-term

leasehold

improvements

Plant and

Equipment Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

COST

At 26 April 2020 524.4 918.9 70.6 131.6 772.6 2,418.1

Acquisitions 2.1 0.5 - - 29.0 31.6

Additions 118.8 84.3 4.3 2.0 128.8 338.2

Eliminated on disposals (48.1) (16.5) (0.7) (6.0) (57.4) (128.7)

Reclassifications /

Remeasurements

(1)

76.4 (79.4) 79.2 0.1 8.7 85.0

Exchange differences (4.5) (2.4) (0.1) (0.3) (2.9) (10.2)

At 25 April 2021 669.1 905.4 153.3 127.4 878.8 2,734.0

Acquisitions (see note 32) 5.6 7.0 - - 6.9 19.5

Additions 100.9 79.3 4.1 2.5 195.3 382.1

Eliminated on disposals (75.9) (42.0) (1.2) (4.7) (82.0) (205.8)

Reclassifications /

Remeasurements

(2)

(5.4) (43.4) - - (0.2) (49.0)

Exchange differences (7.7) (2.3) (0.5) (0.1) (3.0) (13.6)

At 24 April 2022 686.6 904.0 155.7 125.1 995.8 2,867.2

ACCUMULATED DEPRECIATION AND IMPAIRMENT

At 26 April 2020 (218.7) (153.3) (16.7) (113.9) (567.9) (1,070.5)

Charge for the period (82.1) (74.5) (11.6) (11.5) (118.8) (298.5)

Impairment (168.2) (84.4) (3.9) (0.1) (59.8) (316.4)

Eliminated on disposals 47.5 11.2 0.3 6.7 54.4 120.1

Reclassifications /

Remeasurements

(1)

- 18.1 (17.9) - (8.8) (8.6)

Exchange differences 2.1 0.2 0.1 0.1 2.3 4.8

At 25 April 2021 (419.4) (282.7) (49.7) (118.7) (698.6) (1,569.1)

Charge for the period (77.6) (47.9) (12.4) (3.6) (105.1) (246.6)

Impairment (76.8) (106.5) (2.0) - (40.7) (226.0)

Eliminated on disposals 75.9 15.7 1.1 1.8 79.1 173.6

Reclassifications /

Remeasurements

(2)

- 0.6 (0.1) (1.1) 4.0 3.4

Exchange differences 6.0 0.3 0.1 0.2 1.9 8.5

At 24 April 2022 (491.9) (420.5) (63.0) (121.4) (759.4) (1,856.2)

NET BOOK VALUE

At 24 April 2022 194.7 483.5 92.7 3.7 236.4 1,011.0

At 25 April 2021 249.7 622.7 103.6 8.7 180.2 1,164.9

At 26 April 2020 305.7 765.6 53.9 17.7 204.7 1,347.6

(1) In FY21 a number of properties were identified that were previously classified within Freehold Land and Buildings but management believe

it to be more appropriate to classify within Long-term Leasehold. These have therefore been adjusted in the prior period as reclassifications.

(2) During the period assets were identified that were previously classified within Property, Plant and Equipment but management believe it to be

more appropriate to classify within Investment Properties. These have therefore been adjusted in the period as reclassifications.

Note 2 provides further detail on the property related impairments (relating to ROU assets and freehold land

and buildings).

FRASERS GROUP PLC ANNUAL REPORT 2022

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Leases

The Group only has property leases within the scope of IFRS 16, including retail stores, offices and warehouses. Leases

are largely for a period between 1 – 15 years typically with break clauses. It is management’s intention to continue to

enter into turnover linked leases in the future.

The Group presents right-of-use assets that do not meet the definition of investment property in ‘property, plant and

equipment’, the same line item as it presents underlying assets of the same nature that it owns. The carrying amount

and movements in the period can be seen in the table above.

Lease liabilities are presented separately within the Consolidated Balance Sheet. The maturity analysis of lease

liabilities is shown in note 30(f). Interest expense on the lease liability is presented as a component of finance costs as

per note 13. Cash payments for the principal portion and the interest portion of the lease liability are presented in the

Consolidated Cash Flow Statement with further details given in note 27.

The Group is party to a number of leases that are classed as short term leases and with variable lease payments.

These are typically property leases on turnover based rents. Note 8 discloses variable lease payments and short term

and low value lease expenses incurred in the period. Cash flows in the period relating to variable lease payments,

short term lease payments, and leases for low value assets were approx. £33m (FY21: approx. £24m). It is expected that

future cash flows will not be materially different to the FY22 cash flows.

Leases to which the Group is committed but have not yet commenced at period end are not considered to

be material.

18. INVESTMENT PROPERTIES

Total

(£’m)

COST

At 26 April 2020 45.8

Eliminated on disposals (7.6)

At 25 April 2021 38.2

Additions 42.0

Reclassifications

(1)

43.4

At 24 April 2022 123.6

ACCUMULATED DEPRECIATION AND IMPAIRMENT

At 26 April 2020 (26.9)

Charge for the period (1.9)

Impairment (0.6)

Eliminated on disposals 5.3

At 25 April 2021 (24.1)

Charge for the period (5.9)

Impairment (1.0)

Reclassifications

(1)

(3.4)

At 24 April 2022 (34.4)

NET BOOK VALUE

At 24 April 2022 89.2

At 25 April 2021 14.1

At 26 April 2020 18.9

(1) During the period assets were identified that were previously classified within Property, Plant and Equipment but management believe it to be more

appropriate to classify within Investment Properties. These have therefore been adjusted in the period as reclassifications.

The fair values of the Group’s investment properties as at 24 April 2022 and 25 April 2021 were estimated as being

materially in line with carrying values. The valuations were calculated by the Group’s internal property team who are

appropriately qualified chartered surveyors and follow the applicable valuation methodology of the Royal Institute of

Chartered Surveyors. Note 2 provides further detail on the property related impairments.

FRASERS GROUP PLC ANNUAL REPORT 2022

153

19. INTANGIBLE ASSETS

Goodwill

Trademarks

and licenses Brands Customer related Total

(£’m) (£’m) (£’m) (£’m) (£’m)

COST

At 26 April 2020 173.4 94.0 90.4 - 357.8

Acquisitions 6.0 - - - 6.0

Additions - 1.0 - - 1.0

Disposals - (3.3) - - (3.3)

Exchange adjustments (8.7) (1.0) (9.8) - (19.5)

At 25 April 2021 170.7 90.7 80.6 - 342.0

Acquisitions 1.3 - - 5.7 7.0

Exchange adjustments 4.8 0.4 6.4 - 11.6

At 24 April 2022 176.8 91.1 87.0 5.7 360.6

AMORTISATION AND IMPAIRMENT

At 26 April 2020 (119.3) (89.1) (6.0) - (214.4)

Amortisation charge (0.3) (1.3) (5.5) - (7.1)

Impairment (9.1) - - - (9.1)

Disposals - 3.3 - - 3.3

Exchange adjustments 4.7 0.4 0.7 - 5.8

At 25 April 2021 (124.0) (86.7) (10.8) - (221.5)

Amortisation charge - (0.5) (6.0) (1.0) (7.5)

Impairment (5.7) - - - (5.7)

Exchange adjustments (2.7) (0.1) (2.5) - (5.3)

At 24 April 2022 (132.4) (87.3) (19.3) (1.0) (240.0)

At 24 April 2022 44.4 3.8 67.7 4.7 120.6

At 25 April 2021 46.7 4.0 69.8 - 120.5

At 26 April 2020 54.1 4.9 84.4 - 143.4

Amortisation is charged to selling, distribution and administrative expenses in the consolidated Income Statement.

The majority of the net book value of intangible assets relates to the £86.5m purchase of Everlast in 2007.

The carrying value of goodwill and brands that are considered to have an indefinite life are allocated to the Group’s

operating segments before aggregation. With the exception of Everlast, none of the individual cash-generating units

(CGUs) are considered material to goodwill or indefinite life intangibles. The carrying value of goodwill and brands

allocated to the Group’s CGUs (as aggregated except in the case of Everlast) is shown below:

24 April 2022 25 April 2021

Goodwill Brands Goodwill Brands

(£’m) (£’m) (£’m) (£’m)

Wholesale & Licensing (excl. Everlast) 9.9 - 14.3 -

Everlast 34.5 67.7 32.4 69.8

44.4 67.7 46.7 69.8

FRASERS GROUP PLC ANNUAL REPORT 2022

154

The Group tests the carrying amount of goodwill and

assets with an indefinite life annually for impairment

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 indication of impairment.

Impairment is calculated by comparing the carrying

amounts to the value in use derived from discounted

cash flow projections for each CGU to which the

intangible assets are allocated. A CGU is deemed to

be an individual fascia or brand and these have been

grouped together into similar classes for the purpose

of formulating operating segments as reported in note

4. The total recoverable amount of all CGUs in relation

to the above intangible assets was £228.1m of which

£128.3m related to Everlast. The recoverable amount

relating to Everlast is based on a value in use calculation

that includes expected cash flows from new commercial

negotiations. Based on management’s forecasts if these

new commercial negotiations are unsuccessful there

could be a need for a full impairment review of Everlast’s

intangible assets. Due to the ongoing challenges with

the retail sector, part of the Wholesale & Licensing

goodwill was impaired in the period with an impairment

charge of £4.4m (FY21: £3.1m) being recognised where

the discounted present value of future cash flows did not

support the full value of the asset.

Value in use calculations are based on five-year

management forecasts with a terminal growth rate

applied thereafter, representing management’s estimate

of the long-term growth rate of the sector served by

the CGUs.

Total impairments of £5.7m (FY21: £9.1m) have been

recognised in relation to goodwill on loss making

companies and are individually immaterial to each CGU

that has been written down. These impairments include

an element of the Wholesale & Licensing goodwill

and the goodwill from acquisitions in the period. The

impairment of goodwill from acquisitions in the period of

£1.3m has been recognised in Exceptional Items,

see note 6.

The Everlast brand is amortised over a 15 year period

within the selling, distribution and administrative

expenses category within the income statement. The

amount charged to the income statement in the period

is £6.0m (FY21: £5.5m), the future amortisation charge is

expected to be approximately £6.0m per annum for the

remaining 12 year amortisation period (FY21: 13 year).

The key assumptions, which are equally applicable to each CGU, in the cash flow projections used to support the

carrying amount of goodwill were as follows:

As at

24 April 2022

Wholesale & Licensing

(excl. Everlast)

Everlast

Terminal sales growth

2.0% 2.0%

5 year forecast growth

(1)

(4.4%) (0.6%)

Discount rate

7.5% 13.5%

As at

25 April 2021 European Retail

Wholesale & Licensing

(excl. Everlast)

Everlast

Terminal sales growth

2.0% 2.0% 2.0%

5 year forecast growth

(1)

(3.5%) (5.3%) (1.6%)

Gross margin

30% - 40% - -

Discount rate

6.3% 6.3% 12.1%

(1) The 5 year growth rates are based on the average growth over 5 years.

Historically the same pre-tax discount rate was used in European Retail and Wholesale & Licensing (excl. Everlast) as

these CGU’s were considered to have similar risk profiles. A specific discount rate is used for Everlast as this business

operates in a different market and has different characteristics.

The key assumptions are based on market data and management’s historical experience and future plans for

each CGU.

FRASERS GROUP PLC ANNUAL REPORT 2022

155

Sensitivity Analysis

A reasonably possible change in any key assumption would not cause the carrying value of the Everlast or Wholesale

& Licensing (excluding Everlast) CGU to exceed its recoverable amount, the table below shows the amount of

headroom and the revised assumption required in order to eliminate the headroom in full.

Wholesale &

Licensing

(excl. Everlast)

Everlast

Recoverable amount of CGU (£'m)

99.8 128.3

Current headroom (£'m)

89.9 13.7

Revised 5-year forecast growth rate %

(6.0%) 0.1%

Revised terminal growth rate %

< (1000%) (0.1%)

Revised discount rate %

89.0% 14.9%

20. INVESTMENTS IN ASSOCIATED UNDERTAKINGS

The Group uses the equity method of accounting for associates and joint ventures in accordance with IAS 28. The

following table shows the aggregate movement in the Group’s investment in associates and joint ventures:

Associates

(£’m)

At 25 April 2021 and 24 April 2022 -

The Group currently holds a 49.0% share of Four (Holdings) Limited (FY21: 49.0%), the carrying amount of this

investment is £nil (FY21: £nil). Detailed disclosures have not been presented as the results are immaterial. The Group

is owed £62.4m from the group of companies headed by Four (Holdings) Limited (£24.0m net of amounts recognised

in respect of loss allowance) (FY21: £64.9m, £26.5m net of loss allowance), see note 23 for further details. The group of

companies headed by Four (Holdings) Limited made a profit of £11.5m in the period (FY21: profit of £8.1m).

21. 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. The majority of

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:

24 April 2022 25 April 2021

(£m) (£m)

At beginning of period

263.3 83.8

Additions

198.4 113.3

Disposals

(238.4) (7.0)

Amounts recognised through other comprehensive income

(8.1) 77.3

Exchange differences

(8.6) (4.1)

206.6 263.3

Included within long-term financial assets at the period ended 24 April 2022 are the following direct interests held by

the Group:

• 36.9% (FY21: 36.8%) interest in Mulberry Group plc

• 28.9% (FY21: 35.6%) interest in Studio Retail Group plc

• 2.2% (FY21: 5.1%) interest in Hugo Boss AG

• Various other interests, none of which represent more than 5.0% of the voting power of the investee

FRASERS GROUP PLC ANNUAL REPORT 2022

156

The following table shows the fair value of each of the Group’s long-term financial assets (all listed):

24 April 2022 25 April 2021

(£m) (£m)

Mulberry Group plc

65.3 52.0

Studio Retail Group plc

- 89.7

Hugo Boss AG

68.4 118.7

Other

72.9 2.9

At end of period

206.6 263.3

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 assist in building relationships with key suppliers and brands.

22. INVENTORIES

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Goods for resale

1,277.6 1,096.6

As at 24 April 2022, goods for resale include a right of return asset totalling £3.2m (FY21: £4.5m). Amounts written off in

the period relating to stock was £59.8m (FY21: £24.3m).

The following inventory costs have been recognised in cost of sales:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Cost of inventories recognised as an expense

2,703.3 2,094.5

The Directors have reviewed the opening and closing provisions against inventory and have concluded that these are

fairly stated. The Group has reviewed its estimates and assumptions for calculating inventory provisions at 24 April

2022. Overall provisions have increased from £219.8m in FY21 to £236.7m as at 24 April 2022, with this £16.9m change in

provision being recognised as a charge in cost of sales.

23. TRADE AND OTHER RECEIVABLES

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Gross credit customer receivables

372.7 -

Allowance for expected credit loss on credit customer receivables

(138.5) -

Net credit customer receivables

234.2 -

Trade receivables

56.4 57.2

Deposits in respect of derivative financial instruments

243.9 131.0

Amounts owed by related parties (see note 35)

24.2 26.8

Other receivables

170.2 246.9

Prepayments

112.5 84.6

841.4 546.5

Following the acquisition of Studio Retail Limited (see note 32), credit customer receivables now make up a significant

element of trade and other receivables. 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.

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.

FRASERS GROUP PLC ANNUAL REPORT 2022

157

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, interest rates and volatility) and further purchases / sales of underlying investments held.

Included within other receivables is the reimbursement asset totalling £88.3m (FY21: £118.3m) in relation to the Group’s

ongoing non-UK tax enquiries, for further information see note 29.

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, for further details

see note 35.

Exposure to credit risk of trade receivables:

24 April 2022 25 April 2021

(£m) (£m)

Current

24.2 31.8

0-30 days past due

14.2 12.0

30-60 days past due

4.6 4.0

60-90 days past due

3.0 2.4

Over 90 days past due

10.4 7.0

56.4 57.2

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

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Opening position

68.3 46.2

Amounts charged to the income statement

6.6 22.3

Amounts written off as uncollectable

- (0.1)

Amounts recovered during the period

- (0.1)

Closing position

74.9 68.3

Included in the below table is the loss allowance movement in amounts due from related parties as follows:

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Opening position

38.4 33.8

Amounts charged to the income statement

- 4.6

Closing position

38.4 38.4

The gross carrying amount of the balance due is £62.6m (FY21: £65.2m). The charge in the prior period was recorded in

Selling, distribution and administrative expenses. £17.6m 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 (FY21: £12.4m 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.

FRASERS GROUP PLC ANNUAL REPORT 2022

158

Credit Customer Receivables

Certain of the Studio’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 £287.2m were eligible to be funded via the

securitisation facility, and the facilities utilised

were £143.6m.

Other information

The average credit period taken on sales of goods is 219

days. On average, interest is charged at 3.5% per month

on the outstanding balance.

Studio 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. Studio 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

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.

Studio 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, Studio 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 24,711 accounts (acquisition date: 23,396)

with total gross balances of £16.2m (acquisition date:

£15.1m) on repayment plans. Provisions are assessed as

detailed above.

During the current period, overdue receivables with

a gross value of £5.3m 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 24 April 2022:

24 April 2022 24 February 2022

Trade receivables

on forbearance

arrangements Total Trade receivables

Trade receivables

on forbearance

arrangements Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Ageing of trade receivables

Not past due 272.1 14.3 286.4 298.4 13.6 312.0

Past due:

0 - 60 days 36.7 1.8 38.5 36.8 1.5 38.3

60 - 120 days 20.0 0.1 20.1 14.9 - 14.9

120+ days 27.7 - 27.7 17.8 - 17.8

Gross trade receivables 356.5 16.2 372.7 367.9 15.1 383.0

Allowance for expected

credit loss

(127.3) (11.2) (138.5) (118.5) (10.5) (129.0)

Carrying value 229.2 5.0 234.2 249.4 4.6 254.0

24 February 2022 to 24 April 2022

Stage 1 Stage 2 Stage 3 Total

(£’m) (£’m) (£’m) (£’m)

Gross trade receivables 248.6 59.9 64.2 372.7

Allowance for doubtful debts:

Acquisition balance (61.1) (25.7) (42.2) (129.0)

Impairment charge 0.6 - (14.8) (14.2)

Utilisation in period 0.1 - 4.6 4.7

Closing balance (60.4) (25.7) (52.4) (138.5)

Carrying value 188.2 34.2 11.8 234.2

Analysis of impairment charge:

FRASERS GROUP PLC ANNUAL REPORT 2022

159

24 February 2022 to 24 April 2022

(£’m)

Impairment charge impacting on provision

(14.2)

Recoveries 1.1

Other (0.2)

Impairment charge (13.3)

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 £2.2m.

A 1% increase/decrease in the assumed recoveries rate would result in the impairment provision decreasing/increasing

by approximately £1.1m.

Changing the weighting of macro-economic scenarios so that the base-case scenario’s weighting is halved to 30%

(with upside increasing to 30% and both downside and severe increasing to 20%) would result in the impairment

provision reducing by approximately £1.7m.

These sensitivities reflect management’s assessment of reasonably possible changes to key assumptions which could

result in a material adjustment to the level of provision within the next financial year.

24. CASH AND CASH EQUIVALENTS

24 April 2022 25 April 2021

(£m) (£m)

Cash in bank and in hand - Sterling

135.4 144.1

Cash in bank and in hand - US dollars

(4.7) 97.4

Cash in bank and in hand - Euros

176.4 192.5

Cash in bank and in hand - Other

29.7 23.0

Cash and cash equivalents including overdrafts at period end

336.8 457.0

25. SHARE CAPITAL

24 April 2022 25 April 2021

(£m) (£m)

AUTHORISED

999,500,010 ordinary shares of 10p each

100.0 100.0

ALLOTTED, CALLED UP AND FULLY PAID

640,602,369 (2021: 640,602,369) ordinary shares of 10p each

64.1 64.1

SHARE CAPITAL

At 24 April 2022 and At 25 April 2021

64.1 64.1

The Group holds 151,240,174 shares in Treasury as at period end (FY21: 121,260,175).

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one

vote per ordinary share at general meetings of the Company.

We are aware of unsponsored American Depository Receipt (ADR) programmes established from time to time in

respect of our shares. We have not sponsored or authorised their creation and any questions should be directed to the

relevant depositary.

Frasers has not and does not intend to offer or sell its Ordinary Shares or other securities (in the form of ADR or

otherwise) to the general public in the United States nor has it listed or intends to list its Ordinary Shares or other

securities on any national securities exchange in the United States or to encourage the trading of its Ordinary Shares

on any over the counter market located in the United States. Frasers does not make arrangements to permit the

FRASERS GROUP PLC ANNUAL REPORT 2022

160

voting of Ordinary Shares held in the form of ADRs

and its publication of periodic financial and other

information is not intended to facilitate the operation of

any unsponsored ADR programme under Rule 12g3-2(b)

of U.S. Securities Exchange Act of 1934, as amended

or otherwise.

Contingent Share Awards

Share Schemes

The 2011 Share Scheme was a four year scheme

based upon achieving underlying EBITDA (before the

costs of the scheme) of £215m in FY12, £250m in FY13,

£260m in FY14 and £300m in FY15 coupled with the

individual participating employee’s satisfactory personal

performance and continued employment. All of the

above targets were met meaning that approx. 11.6m

shares vested in September 2017 and approx. 4m shares

vested in September 2015.

Between 26 April 2021 and 24 April 2022, 24,361 shares

sold by participants following exercise of awards under

the Group 2011 Share Scheme were acquired by Estera

Trust (Jersey) Limited, as Trustee of the Sports Direct

Employee Benefit Trust (Trustee), with the acquisition

being funded by a loan advanced by the Company

of £0.2m. The shares were acquired at prices of

between 603.5 and 683.5 pence per share in off-market

transactions. The weighted average purchase price was

658 pence per share (FY21: 365 pence per share).

The Group holds 17,386,913 shares in the Own Share

Reserve as at period end (FY21: 17,386,913).

Fearless 1000 Bonus Scheme

FY21 scheme launch

At the annual general meeting in October 2020, our

shareholders gave approval for the Fearless 1000 bonus

scheme. Under this scheme shares may be issued by the

Group to employees for no cash consideration. All Group

employees (excluding Executive Directors, their family

associates, and the Head of Commercial) are eligible to

participate in the scheme. Under the scheme, 10 million

shares are awarded to eligible employees if certain

market conditions are achieved. This would equate to

£100m worth of fully paid ordinary shares in Frasers

Group Plc that could be paid to eligible employees if our

share price reaches £10 any time over the next four years.

The share price must stay above £10 for 30 consecutive

trading days to trigger the vesting of shares at the end

of the four year vesting period. 50% of the shares are

granted after 4 years and the remaining 50% after 5

years. One thousand eligible employees will receive the

shares with a potential value ranging from £50k to £1m if

the share price is at £10 at the vesting dates. In all other

respects the shares rank equally with other fully paid

ordinary shares on issue.

The share element of the scheme is deemed to be an

equity-settled scheme as defined by IFRS 2 Share-based

payment. In line with the accounting policy in note 1,

the fair value at the date of grant is expensed to the

Consolidated Income Statement on a straight-line basis

over the vesting period, with the corresponding credit

going to equity.

The assessed fair value at grant date of the shares

granted during the period ended 25 April 2021 was

165.69p per share for the 4 year vesting period and

165.95p per share for the 5 year vesting period. The

fair value at grant date is independently determined

using an adjusted form of the Black-Scholes model

which includes a Monte Carlo simulation model that

takes into account the exercise price, the term of the

option, the impact of dilution (where material), the share

price at grant date and expected price volatility of the

underlying share, the expected dividend yield, and the

risk-free interest rate for the term of the scheme. The

model inputs for shares granted during the period ended

25 April 2021 included:

• exercise price: £nil

• grant date: 10 February 2021, being the date the

Deed of Grant was executed

• expiry date: 7 October 2024 and 7 October 2025

• share price at grant date: 450p

• expected price volatility of the Company’s

shares: 38.8%

• expected dividend yield: 0%

• risk-free interest rate: 0.1%

The expected price volatility is based on the historic

volatility (based on the remaining life of the scheme),

adjusted for any expected changes to future volatility

due to publicly available information.

A charge in the Consolidated Income Statement of

£0.8m was recognised in the FY21 period in relation to

the equity-settled element of the scheme resulting in

£0.8m being held in equity.

The scheme also has a cash-settled bonus for all other

eligible employees who do not qualify for the Fearless

1000 share scheme. The cash bonus at the end of the

4 year period is based on the employee tenure and

has been accounted as an other long-term employee

benefit as defined by IAS 19 Employee Benefits. A

charge in the Consolidated Income Statement of

£0.5m was recognised in the FY21 period along with a

corresponding liability.

FY22 update

At the annual general meeting in October 2021, our

shareholders gave approval for an extension to the

performance period for the Fearless 1000 plan up

FRASERS GROUP PLC ANNUAL REPORT 2022

161

to five years. This is seen to benefit participants as it

provides an additional period to achieve the £10 share

price target given that the difficulties associated with

the Covid-19 pandemic have impacted the business in

the first year of the plan. In addition, the Remuneration

Committee can now allow all awards to vest early if a

£15 share price target is achieved.

As per IFRS 2 Share-based payments, the original fair

value charge for the equity-settled scheme will continue

to be taken over the original period. In addition, an

incremental charge is being taken that represents the

additional value provided to participants by making

these amendments and this additional charge is being

taken over the new modified period.

The total assessed fair value of the amendment at grant

date is £1.1m which is being recognised over the 4 and 5

year vesting periods.

A charge in the Consolidated Income Statement of

£0.15m has been recognised in the period in relation

to the modification with an equivalent £0.15m being

recognised in equity.

For the equity-settled element of the FY21 Fearless 1000

plan, a charge in the Consolidated Income Statement

of £4.1m has been recognised in the period in relation to

the scheme with an equivalent £4.1m being recognised

in equity.

For the cash-settled element of the FY21 Fearless 1000

plan, a charge to the Consolidated Income Statement

of £2.4m has been recognised in the period along with a

corresponding increase in liability.

Executive Share Scheme

At the annual general meeting in October 2021, our

shareholders gave approval for the Executive Share

Scheme. Under this scheme shares may be issued by

the Group to Chris Wootton (CFO), Sean Nevitt (Chief

Commercial Officer) and David Al-Mudallal (COO) for

no cash consideration. Under the scheme, 600,000

shares per person are awarded to the individuals if

certain market conditions are achieved. The share price

must stay above £12 for 30 consecutive trading days to

trigger the vesting of shares at the end of the four year

vesting period, or the Remuneration Committee can

now allow all awards to vest early if a £15 share price

target is achieved. 50% of the shares are granted after

4 years and the remaining 50% after 5 years. In all other

respects the shares rank equally with other fully paid

ordinary shares on issue.

The scheme is deemed to be an equity-settled scheme

as defined by IFRS 2 Share-based payment. In line with

the accounting policy in note 1, the fair value at the

date of grant is expensed to the Consolidated Income

Statement on a straight-line basis over the vesting

period, with the corresponding credit going to equity.

The assessed fair value at grant date of the shares

granted during the period ended 24 April 2022 was

364.22p per share for the 4 year vesting period and

368.44p per share for the 5 year vesting period. The

fair value at grant date is independently determined

using an adjusted form of the Black-Scholes model

which includes a Monte Carlo simulation model that

takes into account the exercise price, the term of the

option, the impact of dilution (where material), the share

price at grant date and expected price volatility of the

underlying share, the expected dividend yield, and the

risk-free interest rate for the term of the scheme. The

model inputs for shares granted during the period ended

24 April 2022 included:

• exercise price: £nil

• grant date: 14 October 2021

• expiry date: 7 October 2025 and 7 October 2026

• share price at grant date: 632p

• expected price volatility of the Company’s

shares: 39.85%

• expected dividend yield: 0%

• risk-free interest rate: 0.54%

FRASERS GROUP PLC ANNUAL REPORT 2022

162

The expected price volatility is based on the historic volatility (based on the remaining life of the scheme), adjusted for

any expected changes to future volatility due to publicly available information.

A charge in the Consolidated Income Statement of £0.8m has been recognised in the period in relation to the scheme

with an equivalent £0.8m being recognised in equity.

26. OTHER RESERVES

Permanent

contribution

to capital

Capital

redemption

reserve

Reverse

combination

reserve

Hedging

reserve

Total other

reserves

(£’m) (£’m) (£’m) (£’m) (£’m)

At 27 April 2020 0.1 8.0 (987.3) 28.0 (951.2)

Cash flow hedges

- recognised in the period - - - 0.4 0.4

- reclassified in the period and reported in

the sales

- - - (2.8) (2.8)

- reclassified and reported in cost of sales - - - (17.1) (17.1)

- taxation - - - 3.0 3.0

At 25 April 2021 0.1 8.0 (987.3) 11.5 (967.7)

Cash flow hedges

- recognised in the period - - - 52.1 52.1

- reclassified and reported in cost of sales - - - 7.5 7.5

- taxation - - - (15.8) (15.8)

At 24 April 2022 0.1 8.0 (987.3) 55.3 (923.9)

The permanent contribution to capital relates to a cash

payment of £50,000 to the Company on 8 February

2007 under a deed of capital contribution.

The capital redemption reserve arose on the redemption

of the Company’s redeemable preference shares of 10p

each at par on 2 March 2007.

The reverse acquisition reserve exists as a result of

the adoption of the principles of reverse acquisition

accounting in accounting for the Group restructuring

which occurred on 2 March 2007 and 29 March 2007

between the Company and Sports World International

Limited, Brands Holdings Limited, International Brand

Management Limited and CDS Holdings SA with Sports

World International Limited as the acquirer.

The hedging reserve represents the cumulative amount

of gains and losses on hedging instruments deemed

effective in cash flow hedges. The cumulative deferred

gain or loss on the hedging instrument is recognised

in the income statement only when the hedged

transaction impacts the income statement.

Other Balance Sheet Reserves

The foreign currency translation reserve is used to record

exchange differences arising from the translation of

the Financial Statements of foreign subsidiaries and

associates.

The own shares reserve represents the cost of shares in

Frasers Group Plc purchased in the market and held by

Frasers Group Employee Benefit Trust to satisfy options

under the Group’s share options scheme. The treasury

reserve represents shares held by the Group in treasury.

The Group holds 17,386,913 shares in the Employee

Benefit Trust as at period end (FY21: 17,386,913).

The non-controlling interests of the Group mostly

relates to Sportland International Group AS and its

subsidiaries. This company is incorporated in Estonia

with the principal places of business being a number of

Baltic countries in Europe. The non-controlling interests

hold 40% of the share capital of Sportland International

Group AS. During the period £5.6m profit (FY21: £3.0m)

has been allocated to the non-controlling interests

of Sportland International Group AS, resulting in an

accumulated non-controlling interests at the end of the

period of £18.0m (FY21: £12.4m). A dividend of £1.3m was

paid to the non-controlling interest in the period (FY21:

£0.9m). The group of companies headed by Sportland

International Group AS has total assets of £68.6m (FY21:

£67.8m) and total liabilities of £23.4m (FY21: £14.6m).

FRASERS GROUP PLC ANNUAL REPORT 2022

163

27. BORROWINGS

24 April 2022 25 April 2021

(£m) (£m)

Current:

Lease liabilities

117.0 188.5

Non-Current

29.7 23.0

Bank and other loans

827.9 705.9

Lease liabilities

503.6 534.2

1,448.5 1,428.6

An analysis of the Group’s total borrowings other than bank overdrafts is as follows:

24 April 2022 25 April 2021

(£m) (£m)

Borrowings - sterling

827.9 705.9

Group borrowings (excluding Studio Retail Limited) are at a rate of interest of 2.0% (FY21: 1.3%) over the interbank

rate of the country within which the borrowing entity resides. As part of the Studio Retail Limited acquisition, a

securitisation loan was acquired which had a balance at 24 April 2022 of £143.6m. The average interest rate paid on

the securitisation loan was 3.23%.

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 26 April 2020

1,376.2 147.9 1,524.1

Cash-flows:

- Borrowings drawn down

1,128.1 - 1,128.1

- Borrowings repaid

(1,323.6) - (1,323.6)

- Borrowings acquired through business combinations

1.4 - 1.4

Lease liability:

- IFRS 16 Lease Liabilities - cash-flows

- (78.0) (78.0)

- IFRS 16 Lease Liabilities - modifications/remeasurements, transfers from non-current

to current, and foreign exchange adjustments

(40.3) 98.1 57.8

- IFRS 16 Lease Liabilities - new leases

98.3 20.5 118.8

At 25 April 2021

1,240.1 188.5 1,428.6

Cash-flows:

- Borrowings drawn down

1,374.4 - 1,374.4

- Borrowings repaid

(1,484.4) - (1,484.4)

- Borrowings acquired through business combinations (note 32)

232.0 - 232.0

Lease liability:

- IFRS 16 Lease Liabilities - cash-flows

- (176.2) (176.2)

- IFRS 16 Lease Liabilities - modifications/remeasurements, transfers from non-current

to current, and foreign exchange adjustments

(136.7) 91.1 (45.6)

- IFRS 16 Lease Liabilities - new leases

90.1 11.4 101.5

- IFRS 16 Lease Liabilities - acquired through business combinations (note 32)

16.0 2.2 18.2

At 24 April 2022

1,331.5 117.0 1,448.5

FRASERS GROUP PLC ANNUAL REPORT 2022

164

On 30 November 2021 the Group refinanced its existing borrowings and entered into a combined term loan and

revolving credit facility of £930.0m for a period of 3 years, with the possibility to extend this by a further 2 years. This

facility increased to £940.0m as at 24 April 2022 and to £980.0m subsequent to the period end. Given the revolving

credit facility is available for a minimum of 3 years and the limited restriction of lending under the facility, the balance

is classified as non-current on the Consolidated Balance Sheet.

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:

24 April 2022 25 April 2021

(£m) (£m)

Borrowings

(1,448.5) (1,428.6)

Add back:

- Lease liabilities

620.6 722.7

Cash and cash equivalents

336.8 457.0

Net debt

(491.1) (248.9)

28. DEFERRED TAX ASSETS AND LIABILITIES

IFRS 16

Accounts

depreciation

exceeding tax

depreciation

Tax losses

recoverable

Bonus

scheme

Forward

currency

contracts

Fair value

adjustments

to intangibles

Retirement

benefit

obligations

Other

temporary

differences Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

At 26 April 2020

28.5 19.6 - - (8.0) (17.6) - 1.8 24.3

Credited/(charged) to the

income statement

14.6 4.1 - - (2.0) 1.0 - (7.4) 10.3

Charged to reserves

- - - (0.3) - 2.5 - - 2.2

Credited to hedging reserves

- - - - 3.0 - - - 3.0

At 25 April 2021

43.1 23.7 - (0.3) (7.0) (14.1) - (5.6) 39.8

Acquired through business

combinations (see note 32)

- 8.2 22.6 - - (1.1) (6.8) 3.2 26.1

Credited/(charged) to the

income statement

10.1 (12.6) - 2.5 - 1.5 (0.5) 0.8 1.8

Charged to reserves

- - - 3.5 - (1.7) 6.7 - 8.5

Credited to hedging reserves

- - - - (15.8) - - - (15.8)

At 24 April 2022

53.2 19.3 22.6 5.7 (22.8) (15.4) (0.6) (1.6) 60.4

24 April 2022 25 April 2021

(£m) (£m)

Deferred tax assets

100.8 66.8

Deferred tax liabilities

(40.4) (27.0)

Net deferred tax balance

60.4 39.8

The tax rates used to measure the deferred tax assets and liabilities was 25% (FY21: 19%), on the basis that this was the

tax rate that was substantively enacted at the balance sheet date.

Deferred tax assets are recognised to the extent that realisation of the related tax benefit is probable on the basis

of the Group’s current expectations of future taxable profits. The Group has approx. £122m of taxable losses not

recognised as a deferred tax asset (approx. £30m deferred tax asset).

FRASERS GROUP PLC ANNUAL REPORT 2022

165

29. PROVISIONS

Legal and

regulatory

Property

Financial

services related Other Total

(£m) (£m) (£m) (£m) (£m)

At 26 April 2020

225.4 107.9 - 2.7 336.0

Amounts provided

7.3 41.5 - - 48.8

Amounts utilised / reversed

(16.9) (5.3) - (1.4) (23.6)

At 25 April 2021

215.8 144.1 - 1.3 361.2

Acquired through business combinations

(see note 32)

7.1 2.7 42.4 - 52.2

Amounts provided

17.7 53.7 - - 71.4

Amounts utilised / reversed

(10.4) (39.3) (0.8) (1.3) (51.8)

At 24 April 2022

230.2 161.2 41.6 - 433.0

Legal and regulatory provisions relate to management’s

best estimate of the potential impact of claims including

legal, commercial, regulatory and ongoing non-UK tax

enquiries. The timing of the outcome of non-UK tax

inquiries and legal claims made against the Group 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. Included within

Legal and regulatory provisions, are amounts relating

to Studio Retail Limited’s ongoing discussions with

HMRC with regard to agreeing a new Partial Exemption

Special Method (the means by which the recovery of

input VAT on costs relating to the company’s financial

services activities is restricted). As at 24 April 2022, the

company held a provision of £6.9m which represents

management’s best estimate of the likely increase in

the level of restriction on the recovery of input VAT over

and above that which has already been restricted in

the company’s quarterly VAT returns. We note that

management’s best estimate is one of a number of

different outcomes so the amounts provided may differ

to the final costs incurred by the company in respect of

this matter.

A reimbursement asset of £88.3m (FY21: £118.3m) has

been recognised separately within debtors relating to

ongoing non-UK tax enquiries.

Included within property related provisions are

provisions for dilapidations in respect of the Group’s

retail stores and warehouses. Further details of

managements estimates are included in note 2.

Other provisions relate to provisions for restructuring and

employment (non-retirement related).

Included above is a provision of £41.6m for probable

outflows in respect of the financial services business.

As a regulated business, Studio Retail Limited has an

obligation to proactively review its business to ensure

that appropriate outcomes were delivered to customers.

Based on work undertaken as at the balance sheet date

it is considered likely that some level of remediation will

be required to fully satisfy this obligation.

The provision recognises the inherent uncertainties in

any such remediation including the number of customers

who might have been impacted, the proportion of those

who were adversely affected by the legacy decisions,

the possible remediation payable, and overlays these

uncertainties with a risk-based consideration of the

proportion of the population identified above that

suffered adverse outcomes, and the period over which

such adverse outcomes may have been suffered.

Assumptions have been overlaid in respect of the timing

and mechanism for undertaking any remediation.

At this stage a detailed analysis of the relevant customer

cohorts has not yet been completed and as such

there are a range of outcomes which could result in a

settlement which is significantly lower or higher than the

amount estimated. This variation could be significant

and therefore highly material for a user of these

accounts. This range of outcomes is expected to narrow

as the work to substantiate each of the uncertainties set

out above is completed. It is anticipated this work will be

completed within the 12 month fair value measurement

period in line with IFRS3.

The timing of any potential outflows is also uncertain, but

we have assumed that these take place within two years.

The recognition of a provision by the Group is not an

admission of liability for the payment of this amount,

but rather to comply with the Directors’ obligations to

prepare financial statements that give a true and fair

view of the performance and financial position of the

Group in accordance with IFRS.

FRASERS GROUP PLC ANNUAL REPORT 2022

166

30. FINANCIAL INSTRUMENTS

A. Financial Assets and Liabilities by Category and Fair Value Hierarchy

The fair value hierarchy of financial assets and liabilities, which are principally denominated in Sterling or US Dollars,

were as follows:

Level 1 Level 2 Level 3 Other Total

FINANCIAL ASSETS - 24 April 2022 (£’m) (£’m) (£’m) (£’m) (£’m)

Amortised cost:

Trade and other receivables*

- - - 704.7 704.7

Cash and cash equivalents

- - - 336.8 336.8

Amounts owed by related parties

- - - 24.2 24.2

FVOCI:

Long Term Financial Assets (Equity Instruments) - designated

206.6 - - - 206.6

Derivative financial assets (FV):

Foreign forward purchase and sales contracts, and interest rate swaps

- 116.5 - - 116.5

FINANCIAL LIABILITIES - 24 April 2022

Amortised cost:

Non-current borrowings

- - - (827.9) (827.9)

Trade and other payables**

- - - (721.7) (721.7)

IFRS 16 Lease liabilities

- - - (620.6) (620.6)

Derivative financial liabilities (FV):

Foreign forward and written options purchase and sales contracts - Unhedged

- (31.3) - - (31.3)

Derivative financial liabilities - contracts for difference & equity options

- (75.9) - - (75.9)

- (107.2) - - (107.2)

*Prepayments of £112.5m are not included as a financial asset.

**Other taxes including social security costs of £8.1m are not included as a financial liability.

Level 1 Level 2 Level 3 Other Total

FINANCIAL ASSETS - 25 April 2021 (£’m) (£’m) (£’m) (£’m) (£’m)

Amortised cost:

Trade and other receivables*

- - - 435.1 435.1

Cash and cash equivalents

- - - 457.0 457.0

Amounts owed by related parties

- - - 26.8 26.8

FVOCI:

Long Term Financial Assets (Equity Instruments) - designated

263.3 - - - 263.3

Derivative financial assets (FV):

Foreign forward purchase and sales contracts

- 35.3 - - 35.3

Derivative financial assets - contracts for difference & equity options

- 20.1 - - 20.1

- 55.4 - - 55.4

FINANCIAL LIABILITIES - 25 April 2021

Amortised cost:

Non-current borrowings

- - - (705.9) (705.9)

Trade and other payables**

- - - (620.1) (620.1)

IFRS 16 Lease liabilities

- - - (722.7) (722.7)

Derivative financial liabilities (FV):

Foreign forward and written options purchase and sales contracts - Unhedged

- (17.5) - - (17.5)

Derivative financial liabilities - contracts for difference & equity options

- (1.7) - - (1.7)

- (19.2) - - (19.2)

*Prepayments of £84.6m are not included as a financial asset.

**Other taxes including social security costs of £26.2m are not included as a financial liability.

FRASERS GROUP PLC ANNUAL REPORT 2022

167

B. Financial Assets and Liabilities Sensitivities by Currency

The Group’s principal foreign currency exposures are to US Dollars and Euros. The table below illustrates the

hypothetical sensitivity of the Group’s reported profit and equity to a 5% increase and decrease in the US Dollar /

Sterling and Euro / Sterling exchange rates at the year-end date, assuming all other variables remain unchanged.

The figures have been calculated by comparing the fair values of outstanding foreign currency contracts, assets and

liabilities at the current exchange rate to those if exchange rates moved as illustrated. The income statement figures

include the profit effect of any relevant derivatives which are not in a designated cash flow hedge. The impact on US

Dollar and Euro related hedging instruments is included in equity.

The analysis has been prepared using the following assumptions:

1. Existing assets and liabilities are held as at the period end; and

2. No additional hedge contracts are taken out.

SENSITIVITY

USD EUR

GBP & Other USD EUR Total -5% +5% -5% +5%

FY22:

Trade and Other Receivables

648.6 24.5 31.6 704.7 (1.2) 1.2 (1.6) 1.6

Cash and cash equivalents

243.2 19.2 74.4 336.8 (1.0) 1.0 (3.7) 3.7

Trade and Other Payables

(614.0) (15.0) (92.7) (721.7) 0.8 (0.8) 4.6 (4.6)

FY21:

Trade and Other Receivables

370.1 25.2 39.8 435.1 (1.3) 1.3 (2.0) 2.0

Cash and cash equivalents

353.4 49.4 54.2 457.0 (2.5) 2.5 (2.7) 2.7

Trade and Other Payables

(489.0) (24.5) (106.6) (620.1) 1.2 (1.2) 5.3 (5.3)

There is no difference between fair value and carrying value of the above financial instruments (FY21: £nil).

Fair Value Hierarchy

The Group uses the following hierarchy for determining

and disclosing the fair value of financial instruments by

valuation technique:

• Level 1: quoted (unadjusted) prices in active markets

for identical assets or liabilities;

• Level 2: other techniques for which all inputs which

have a significant effect on the recorded fair value

are observable, either directly or indirectly; and

• Level 3: techniques which use inputs which have a

significant effect on the recorded fair value that are

not based on observable market data.

Contracts for difference are classified as Level 2 as the

fair value is calculated using quoted prices for listed

shares and commodities at contract inception and the

period end.

Foreign forward purchase and sales contracts and

options are classified as Level 2, the Group enters into

these derivative financial instruments with various

counterparties, principally financial institutions with

investment grade credit ratings. Foreign exchange

forward contracts and options are valued using

valuation techniques, which employ the use of market

observable inputs. The most frequently applied

valuation techniques include forward pricing and swap

models using present value calculations.

The models incorporate various inputs including the

credit quality of counterparties, foreign exchange spot

and forward rates, and yield curves of the respective

currencies.

Long-term financial assets such as equity instruments

are classified as Level 1 as the fair value is calculated

using quoted prices.

The fair value of equity derivative agreements are

included within the derivative financial assets balance

of £nil (FY21: £20.1m) and derivative financial liabilities

balance of £75.9m (FY21: £1.7m). The derivative financial

assets and derivative financial liabilities as at 24 April

2022 relate to strategic investments held of between

0.8% and 22.4% of investee share capital.

Sold options are classified as Level 2 as the fair value

is calculated using other techniques, where inputs are

observable.

Trade receivables / payables, amounts owed from

related parties, other receivables / payables, cash and

cash equivalents, current / non-current borrowings, and

lease liabilities are held at amortised cost.

The maximum exposure to credit risk as at 24 April 2022

and at 25 April 2021 is the carrying value of each class

of asset in the Balance Sheet, except for amounts owed

from related parties which is the gross carrying amount

of £62.6m (FY21: £65.2m).

FRASERS GROUP PLC ANNUAL REPORT 2022

168

C. Derivatives: Foreign Currency Forward Contracts

(c)(i) Hedging

The most significant exposure to foreign exchange

fluctuations relates to purchases made in foreign

currencies, principally the US Dollar and online sales in

Euros. The Group’s policy is to reduce substantially the

risk associated with foreign currency spot rates by using

forward fixed rate currency purchase contracts, taking

into account any foreign currency cash flows. The Group

does not hold or issue derivative financial instruments

for trading purposes, however if derivatives, including

both forwards and written options, do not qualify for

hedge accounting they are accounted for as such and

accordingly any gain or loss is recognised immediately

in the income statement. 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 contract and hedge accounting for the forwards

is permitted.

Hedge effectiveness is determined at inception of

the hedge relationship and at every reporting period

end through the assessment of the hedged items and

hedging instrument to determine whether there is still an

economic relationship between the two.

The critical terms of the foreign currency forwards

entered into exactly match the terms of the hedged

item. As such the economic relationship and hedge

effectiveness are based on the qualitative factors and

the use of a hypothetical derivative where appropriate.

Hedge ineffectiveness may arise where the critical terms

of the forecast transaction no longer meet those of the

hedging instrument, for example, if there was a change

in the timing of the forecast sales transactions from

what was initially estimated or if the volume of currency

in the hedged item was below expectations leading

to over-hedging. Differences can arise when the initial

value on the Hedging instrument is not zero.

The hedged items and the hedging instrument are

denominated in the same currency and as a result the

hedging ratio is always one to one.

All derivative financial instruments used for hedge

accounting are recognised initially at fair value and

reported subsequently at fair value in the statement

of financial position. To the extent that the hedge

is effective, changes in the fair value of derivatives

designated as hedging instruments in cash flow

hedges are recognised in other comprehensive income

and included within the cash flow hedge reserve in

equity. Any ineffectiveness in the hedge relationship is

recognised immediately in profit or loss.

At the time the hedged item affects profit or loss,

any gain or loss previously recognised in other

comprehensive income is reclassified from equity

to profit or loss and presented as a reclassification

adjustment within other comprehensive income. If a

forecast transaction is no longer expected to occur, any

related gain or loss recognised in other comprehensive

income is transferred immediately to profit or loss. If the

hedging relationship ceases to meet the effectiveness

conditions then hedge accounting is discontinued and

the related gain or loss is held in the equity reserve until

the forecast transaction occurs.

The fair value of hedged contracts as at 24 April 2022 was:

24 April 2022 25 April 2021

(£m) (£m)

Assets

US Dollar purchases - GBP

32.9 2.4

US Dollar purchases - EUR

54.2 2.3

Euro sales

12.8 30.6

Total

99.9 35.3

Liabilities

US Dollar purchases - GBP

- 7.3

US Dollar purchases - EUR

- 0.1

Total

- 7.4

FRASERS GROUP PLC ANNUAL REPORT 2022

169

The details of hedged forward foreign currency purchase contracts and contracted forward rates were as follows:

24 April 2022 25 April 2021

(£’m) (£’m)

Currency GBP Currency GBP

US Dollar purchases

480.0 340.4 720.0 523.1

Contracted rates USD / GBP 1.41 1.36 - 1.41

Weighted average contracted rates USD / GBP 1.41 1.38

US Dollar purchases 120.0 78.6 120.0 83.9

Contracted rates USD / EUR 1.26-1.31 1.21 - 1.31

Weighted average contracted rates USD / EUR 1.28 1.26

Euro sales (600.0) (574.5) (240.0) (242.4)

Contracted rates EUR / GBP 0.99-1.08 0.99

Weighted average contracted rates EUR / GBP 1.04 0.99

The timing of the contracts is as follows:

Currency Hedging against Currency value Timing Rates

USD/GBP USD inventory purchases USD 480m FY23 1.41

USD/EUR USD inventory purchases USD 120m FY23 - FY24 1.26-1.31

EUR/GBP Euro sales EUR 600m FY23, FY25 0.99-1.08

The foreign currency forwards and options are denominated in the same currency as the highly probably future

inventory purchases and sales so the hedged ratio is 1:1. Hedge ineffectiveness may arise where the critical terms of

the forecast transaction no longer meet those of the hedging instrument, for example if there was a change in the

timing of the forecast sales transactions from what was initially estimated or if the volume of currency in the hedged

item was below expectations leading to over-hedging.

24 April 2022 25 April 2021

(£m) (£m)

Change in discounted spot value of outstanding hedging instruments since inception of the hedge

(77.5) (14.5)

Change in value of hedged item used to determine hedge ineffectiveness

(104.9) (28.1)

24 April 2022 25 April 2021

(£’m) (£’m)

Change in the

fair value of the

currency forward

Change in the

fair value of the

hedged item

Change in the

fair value of the

currency forward

Change in the

fair value of the

hedged item

US Dollars purchases - GBP

30.5 30.5 (4.8) (4.8)

US Dollars purchases - EUR 9.7 9.7 2.1 2.1

Euro sales 11.9 11.9 3.1 3.1

At 24 April 2022 £574.5m of forward sales contracts (FY21: £242.4m) and £419.0m of purchase contracts (FY21: £607.0m)

qualified for hedge accounting and the gain on fair valuation of these contracts of £52.1m (FY21: £0.4m) has therefore

been recognised in other comprehensive income.

At 24 April 2022, £38.6m hedged purchase contracts had a maturity of greater than 12 months (FY21: £210.5m of purchase

contracts) and £332.1m of hedged sales had a maturity of greater than 12 months (FY21: £242.4m of sales contracts).

FRASERS GROUP PLC ANNUAL REPORT 2022

170

The movements through the Hedging reserve are:

USD/GBP EUR/GBP USD/EUR

Total

hedge movement Deferred tax

Total

hedging reserve

(£m) (£m) (£m) (£m) (£m) (£m)

As at 26 April 2020

- 16.6 17.2 33.8 (5.8) 28.0

Recognised

(4.9) 3.2 2.1 0.4 - 0.4

Reclassified in sales

- (2.8) - (2.8) - (2.8)

Reclassified in inventory /

cost of sales

- - (17.1) (17.1) - (17.1)

Deferred Tax

- - - - 3.0 3.0

As at 25 April 2021

(4.9) 17.0 2.2 14.3 (2.8) 11.5

Recognised

30.5 11.9 9.7 52.1 - 52.1

Reclassified in inventory /

cost of sales

7.4 - 0.1 7.5 - 7.5

Deferred Tax

- - - - (15.8) (15.8)

As at 24 April 2022

33.0 28.9 12.0 73.9 (18.6) 55.3

(c)(ii) Unhedged

The sterling principal amounts of unhedged forward contracts and written currency option contracts and contracted

rates were as follows:

24 April 2022 25 April 2021

(£m) (£m)

US Dollar purchases

78.6 40.3

Contracted rates USD / EUR

1.26-1.31 1.31

- Euro sales

(715.9) (383.8)

Contracted rates EUR / GBP

0.99-1.08 0.99

Included within finance costs, classified within fair value adjustment to derivatives, is a loss on fair value of unhedged

forward contracts, written currency option contracts and swaps of £28.9m (FY21: loss of £4.6m).

At 24 April 2022, £78.6m of unhedged purchase

contracts had a maturity at inception of greater than 12

months (FY21: £nil purchase contracts) and £715.9m of

unhedged sales had a maturity at inception of greater

than 12 months (FY21: £335.4m of sales contracts).

These contracts form part of the Treasury management

activities, which incorporates the risk management

strategy for areas that are not reliable enough in timing

and amount to qualify for hedge accounting. This

includes acquisitions, disposals of overseas subsidiaries,

related working capital requirements, dividends and loan

repayments from overseas subsidiaries and purchase

and sale of overseas property. Written options carry

additional risk as the exercise of the option lies with the

purchaser. The options involve the Group receiving a

premium on inception in exchange for accepting that

risk and the outcome is that the bank may require the

Group to sell Euros. However, the Group is satisfied that

the use of options as a Treasury management tool

is appropriate.

FY22 value excludes short term swaps of USD/GBP of

USD 40.0m and EUR/USD of EUR 40.0m which were

required for cash management purposes only. In FY21

there are nil short term swaps at period end.

D. Interest rate swaps

The Group uses interest rate swaps to manage its

exposure to interest rate movements on its bank

borrowings. The Group has two contracts in place that

fix interest payments on variable rate debt. The first

contract covers a notional amount of £250.0m and fixes

the interest rate at 0.985% per annum until 29 May

2026. The second contract covers a notional amount of

£100.0m and fixes the interest rate at 0.45% per annum

until 2 September 2024. The fair value of these interest

rate swaps is an asset of £16.6m (2021: liability of £7.4m).

The fair value gain has been recognised in finance

income classified as fair value adjustment to derivatives.

FRASERS GROUP PLC ANNUAL REPORT 2022

171

E. Sensitivity Analysis

The Group’s principal foreign currency exposures are to US Dollars and Euros. The table below illustrates the

hypothetical sensitivity of the Group’s reported profit and equity to a 10% increase and decrease in the US Dollar /

Sterling and Euro / Sterling exchange rates at the year-end date, assuming all other variables remain unchanged. The

figures have been calculated by comparing the fair values of outstanding foreign currency contracts at the current

exchange rate to those if exchange rates moved as illustrated. The income statement figures include the profit effect

of any relevant derivatives which are not in a designated cash flow hedge. The impact on US Dollar and Euro related

hedging instruments is included in equity.

Positive figures represent an increase in profit or equity:

Income statement Equity

24 April 2022 25 April 2021 24 April 2022 25 April 2021

(£’m) (£’m) (£’m) (£’m)

Sterling strengthens by 10%

US Dollar (2.9) 8.1 (22.6) (17.4)

Euro (39.4) 23.4 10.0 10.9

Sterling weakens by 10%

US Dollar 3.5 (9.9) 27.6 21.3

Euro 48.1 (90.8) (12.3) (13.4)

Interest Rate Sensitivity Analysis

The following table illustrates the sensitivity of the Group’s reported profit and equity to a 0.5% increase or decrease in

interest rates, assuming all other variables were unchanged.

The analysis has been prepared using the following assumptions:

• For floating rate assets and liabilities, the amount of asset or liability outstanding at the balance sheet date is

assumed to have been outstanding for the whole year.

• Fixed rate financial instruments that are carried at amortised cost are not subject to interest rate risk for the

purpose of this analysis.

Positive figures represent an increase in profit or equity:

Income statement Equity

24 April 2022 25 April 2021 24 April 2022 25 April 2021

(£’m) (£’m) (£’m) (£’m)

Interest rate increase of 0.5% (2.6) (3.0) (2.6) (3.0)

Interest rate decrease of 0.5% 2.6 3.0 2.6 3.0

Long term Investments Sensitivity Analysis

The following table illustrates the sensitivity of price risk in relation to long term investments held by the Group:

24 April 2022

Equity

(£'m)

Share price increase of 10%

20.2

Share price decrease of 10%

(20.2)

FRASERS GROUP PLC ANNUAL REPORT 2022

172

F. Liquidity Risk

The table below shows the maturity analysis of the undiscounted remaining contractual cash flows of the Group’s non

derivative liabilities and foreign currency derivative financial instruments:

Less than 1 year 1 to 2 years 2 to 5 years Over 5 years Total

(£’m) (£’m) (£’m) (£’m) (£’m)

2022

Non derivative financial liabilities:

Bank loans and overdrafts

- - 827.9 - 827.9

Bank loans and overdrafts interest

26.5 27.3 28.2 - 82.0

Trade and other payables

721.7 - - - 721.7

IFRS 16 Lease liabilities

131.5 93.6 182.4 426.4 833.9

Derivative financial instruments:

Cash inflows

(1,008.7) (38.5) (711.5) - (1,758.7)

Cash outflows

1,079.7 45.1 702.4 - 1,827.2

950.7 127.5 1,029.4 426.4 2,534.0

2021

Non derivative financial liabilities:

Bank loans and overdrafts

- 705.9 - - 705.9

Bank loans and overdrafts interest

- 9.9 - - 9.9

Trade and other payables

620.1 - - - 620.1

IFRS 16 Lease liabilities

196.6 112.7 196.8 670.9 1,177.0

Derivative financial instruments:

Cash inflows

(396.5) (766.9) (80.6) - (1,244.0)

Cash outflows

389.1 798.9 81.5 - 1,269.5

809.3 860.5 197.7 670.9 2,538.4

Capital Management

The capital structure of the Group consists of equity

attributable to the equity holders of the parent

company, comprising issued share capital (less

treasury shares), share premium, retained earnings

and cash and borrowings.

It is the Group’s policy to maintain a strong capital

base so as to maintain investor, creditor and market

confidence and to sustain the development of

the business.

In respect of equity, the Board has decided that, in order

to maximise flexibility in the near term with regards to a

number of inorganic growth opportunities under review,

not to return any cash by way of a final dividend at

this time.

The Board is committed to keeping this policy under

review and to looking to evaluate methods of returning

cash to shareholders when appropriate.

The objective of the Share Scheme is to encourage

employee share ownership and to link employee’s

remuneration to the performance of the Company. It is

not designed as a means of managing capital.

In respect of cash and borrowings, the Board regularly

monitors the ratio of net debt to Reported EBITDA

(Pre-IFRS 16), the working capital requirements and

forecasted cash flows, however no minimum or

maximum ratios are set outside of maintaining a ratio

of net debt to Reported EBITDA (pre IFRS 16) below 3.0.

The ratio for net debt to Reported EBITDA (pre IFRS 16) is

0.6 (FY21: 0.5). The objective is to keep this figure below

3.0 (FY21: 3.0).

Based on this analysis, the Board determines the

appropriate return to equity holders whilst ensuring

sufficient capital is retained within the Group to meet

its strategic objectives, including but not limited to,

acquisition opportunities.

These capital management policies have remained

unchanged from the prior period.

FRASERS GROUP PLC ANNUAL REPORT 2022

173

31. TRADE AND OTHER PAYABLES

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Trade payables

358.1 279.3

Amounts owed to related undertakings

0.1 2.6

Other taxes including social security costs

8.1 26.2

Other payables

102.0 93.0

Accruals

261.5 245.2

729.8 646.3

Included within other payables are amounts outstanding in respect of gift cards and vouchers of £42.6m (FY21: £28.8m).

The Directors consider that the carrying amount of trade and other payables approximates to their fair value.

32. ACQUISITIONS

i. On 24 February 2022, the Group acquired 100% of the share capital and voting rights of Studio Retail Limited

(SRL) and certain other assets of Studio Retail Group plc (in administration) (SRG) for cash consideration of £28.3m

which is deemed to be the fair value of the consideration. SRL is a digital value retailer with a broad product

offering and the ability to provide customers a range of payment options including a flexible credit facility. The

acquisition will help to accelerate the Group’s ambition to elevate its customer journey including a flexible

repayment proposition. As part of the transaction, SRG assigned its liabilities held to its lending banks under its

revolving credit facilities to SRL. A debt transfer took place which transferred this revolving credit facility debt from

the lending banks to Frasers Group Plc which became the new lender. The fair value adjustment to intangible

assets and inventory relates to management’s assessment of the price that would be paid for the acquired assets

in an orderly transaction between market participants at the acquisition date, as well as the recognition of a

customer related intangible. The fair value adjustment to property, plant and equipment relates to management’s

assessment of the fair value of the buildings acquired as part of the acquisition and which are recognised on the

balance sheet of the Frasers Group Plc company. The fair value adjustment relating to borrowings relates to the

acquisition by Frasers Group Plc of the liabilities held between SRG and the lending banks under its revolving

credit facilities which SRG assigned to SRL. Acquisition related costs of £0.4m are included in administrative

expenses in the Consolidated Income Statement and in cash flows from operating activities in the Consolidated

Cash Flow Statement. The Group continues to hold a 28.9% interest in SRG at the period end, however given the

administration of SRG and the sale of its main trading subsidiary SRL, the interest has been fair valued to £nil with

the loss recognised through other comprehensive income (see note 21).

ii. During the period the Group acquired the entire share capital of Bob Woolmer Sales Limited for consideration of

£2.5m.

The following table summarises the fair values of consideration paid:

Studio Retail

Limited

Other

(£m) (£m)

Cash consideration

28.3 2.5

FRASERS GROUP PLC ANNUAL REPORT 2022

174

The asset and liability values at acquisition are detailed below. We have reviewed the fair value of the assets and

liabilities acquired which are deemed to be provisional given the judgemental nature of some of the balances.

Studio Retail Limited Other

Book Value

Fair Value

Adjustment Fair Value Book Value

Fair Value

Adjustment Fair Value

(£m) (£m) (£m) (£m) (£m) (£m)

Property, plant

and equipment

12.5 7.0 19.5 - - -

Intangible assets

12.6 (6.9) 5.7 - - -

Inventories

56.4 7.6 64.0 0.4 - 0.4

Cash and cash equivalents

29.8 - 29.8 0.8 - 0.8

Retirement benefit

obligations

27.3 - 27.3 - - -

Credit customer

receivables

383.0 - 383.0 - - -

Allowance for expected

credit losses

(129.0) - (129.0) - - -

Deferred tax balances

27.2 (1.1) 26.1 - - -

Borrowings

(253.3) 21.3 (232.0) - - -

Other working capital

(90.9) (90.9) - - -

Lease liability

(18.2) - (18.2) - - -

Provisions

(52.2) - (52.2) - - -

Goodwill

- - - - 1.3 1.3

Bargain purchase

- (4.8) (4.8) - - -

Net assets acquired

5.2 23.1 28.3 1.2 1.3 2.5

The bargain purchase of £4.8m from the Studio Retail Limited acquisition is as a result of the administration of

SRG, and the amount has been recognised within cost of sales within the period. The Goodwill arising on the other

acquisitions of £1.3m has been impaired to £nil as at period end with the impairment being recognised in Exceptional

Items, see note 6. Due to the nature of the credit facility offered by SRL to customers being a rolling facility, where new

purchases are added to the account as they are incurred and payments being allocated against the total customer

balance as received, the credit customer receivable and the IFRS 9 allowance for expected credit losses have been

recognised gross at the acquisition date. The period end analysis of this receivable balance and the IFRS 9 allowance

for expected credit losses can be found at note 23. Sensitivities with regards to the acquired provisions can be found

in note 29.

Since the date of control, the following amounts have been included within the Group’s Financial Statements for

the period:

Studio Retail

Limited

Other

Total

(£m) (£m) (£m) (£m)

Revenue

58.3 0.8 59.1

Operating loss

(6.6) (0.1) (6.7)

Loss before tax

(7.2) (0.1) (7.3)

FRASERS GROUP PLC ANNUAL REPORT 2022

175

Had the acquisitions been included from the start of the period the following amounts would have been included

within the Group’s Financial Statements for the period:

Studio Retail

Limited

Other

Total

(£m) (£m) (£m) (£m)

Revenue

491.4 3.0 494.4

Operating (loss)/profit

(108.9) 0.2 (108.7)

(Loss)/profit before tax

(115.4) 0.2 (115.2)

There were no contingent liabilities acquired as a result of the above transactions.

Reconciliation of net cash outflow from investing activities:

Studio Retail

Limited

Other

Total

(£m) (£m) (£m) (£m)

Cash consideration

(28.3) (2.5) (30.8)

Fair value of cash and cash equivalent acquired

29.8 0.8 30.6

Purchase of subsidiaries, net of cash acquired

1.5 (1.7) (0.2)

During the prior period ended 25 April 2021 the Group acquired the trade and assets of DW Sports for cash

consideration of £37.0m which resulted in Goodwill being recognised of £3.7m.

33. CASH INFLOW FROM OPERATING ACTIVITIES

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

(£m) (£m)

Profit before taxation

335.6 8.5

Net finance cost

18.9 27.2

Net investment income

(24.1) (96.0)

Operating profit/(loss)

330.4 (60.3)

Depreciation of property, plant and equipment

246.6 298.5

Depreciation on investment properties

5.9 1.9

Gain on disposal and modification/remeasurement of lease liabilities

(28.3) (27.7)

Amortisation of intangible assets

7.5 7.1

Impairment of tangible and intangible assets and investment properties

232.7 326.1

Profit on disposal of property, plant and equipment

(10.8) (9.7)

Profit on disposal of intangibles

- (7.5)

Gain on bargain purchase

(4.8) (3.1)

Share based payment charge in equity (excluding deferred tax)

9.2 -

Pension contributions less income statement charge

(1.6) -

Operating cash inflow before changes in working capital

786.8 525.3

Increase in receivables

(33.3) (136.6)

(Increase) / decrease in inventories

(155.0) 99.3

Increase in payables

7.5 64.9

Increase in provisions

22.9 25.4

Cash inflows from operating activities

628.9 578.3

34. CAPITAL COMMITMENTS

The Group had capital commitments of £145.0m as at 24 April 2022 (25 April 2021: £87.1m) relating to warehouse

automation, aircraft, other plant and machinery, and property purchases.

FRASERS GROUP PLC ANNUAL REPORT 2022

176

35. RELATED PARTY TRANSACTIONS

The Group has taken advantage of the exemptions contained within IAS 24 - “Related Party Disclosures” from the

requirement to disclose transactions between Group companies as these have been eliminated on consolidation.

The Group entered into the following material transactions with related parties:

52 weeks ended 24 April 2022:

Relationship Sales Purchases

Trade

and other

receivables

Trade

and other

payables

(£’m) (£’m) (£’m) (£’m)

Related Party

Four (Holdings) Limited & subsidiaries

(1)

Associate 2.6 63.7 24.0 -

Mash Holdings Limited

Parent company - - 0.2 -

Mike Ashley

(2)

Plc Director 1.5 - - -

N M Design London Limited

Connected

persons

- 0.2 - -

Rangers Retail Limited

Associate - - - 0.1

MM Prop Consultancy Limited & M.P.M Elevation Limited

Connected

persons

- 21.0 - -

52 weeks ended 25 April 2021:

Relationship Sales Purchases

Trade

and other

receivables

Trade

and other

payables

(£’m) (£’m) (£’m) (£’m)

Related Party

Four (Holdings) Limited & subsidiaries

(1)

Associate 2.2 41.1 26.5 0.1

Mash Holdings Limited

Parent company - - 0.2 -

Mike Ashley

(2)

Plc Director 1.3 - - -

N M Design London Limited

Connected

persons

- 0.1 - -

MM Prop Consultancy Limited

Connected

persons

- 2.5 - 2.5

Newcastle United Football Club Limited

& St James Holdings Limited

(3)

Connected

persons

0.2 (1.9) 0.1 -

Rangers Retail Limited

Associate - - - 0.1

(1) The outstanding balance with Four (Holdings) Limited reflects the funding related to Agent Provocateur. Management consider that the underlying results of

Four (Holdings) Limited supports the recoverability of the receivables balance. The results of Four (Holdings) Limited are not material on the basis of net

assets and profit before tax, subsequently detailed disclosures have not been presented under IFRS 12.

(2) Use of the Company jet and helicopter are charged at commercial rates.

(3) The sales relate to inventory and purchases include the reversal of the FY20 advertising charge.

An agreement has been entered into with Double Take Limited, a company owned by Mash Holdings Limited in which

Matilda Ashley, Mike Ashley’s daughter, is a director. Under the agreement, Double Take Limited licenses the Group the

exclusive rights to the cosmetic brand SPORT FX. During the period a review has been undertaken and no royalties or

other fees are expected to be payable to Double Take Limited for these rights until at least September 2023, the fee

arrangement will continue to be reviewed on an ongoing basis, no provision is required in the financial statements. It

should be noted that the Group (rather than Double Take Limited) owns the rights to SPORT FX for clothing, footwear

and sports equipment.

N M Design London Limited is a company in which Nicola Murray, Michael Murray’s mother, is a director, who

performs design work for the Group in relation to some of the Group’s sites.

A provision was made in FY20 for £2.0m payable to Newcastle United Football Club, this was reversed in FY21.

FRASERS GROUP PLC ANNUAL REPORT 2022

177

The trade and other receivables balance with Four (Holdings) Limited includes an unsecured loan balance of £60.0m

(gross of amounts recognised in respect of loss allowance) which attracts interest at a rate of 3% within current assets

(FY21: £60.0m). This has been accounted for at amortised cost in accordance with IFRS 9. The carrying value has been

determined by assessing the recoverability of the receivable balance, discounted at an appropriate market rate of

interest. £nil was recognised in the period in respect of doubtful debts (FY21: £4.7m). Further disclosure can be found in

note 23.

The sales amount in relation to Four (Holdings) Limited relates to the interest charge on the loan and the purchases

relate to the purchase of clothing products.

At the period end the Group does not have significant influence over but holds greater than 20% of the voting rights of

Mulberry Group plc. The latest equity amounts and results are shown below:

Mulberry Group plc

Period ended

2 April 2022

(£m)

Share capital

3.0

Share premium

12.2

Retained earnings

27.0

Total equity

42.2

Profit for the period

19.2

The Group does not consider it has the power to participate in the financial and operating policy decisions of Mulberry

Group Plc and so management do not consider the Group to be able to exert significant influence as per IAS 28

Investments in Associates and Joint Ventures and IAS 24 Related Party Disclosures.

Key Management, Executive And Non-Executive Director Compensation

24 April 2022 25 April 2021

(£m) (£m)

Salaries and short-term benefits

1.4 1.3

Fair value charge for Executive Share Scheme (see note 25)

0.8 -

Total

2.2 1.3

Key management personnel are considered to be the Directors and members of management who play a key

part in the long term strategy and operations of the Group. Detailed remuneration disclosures are provided in

the Directors’ Remuneration Report in this annual report including Directors’ shareholdings and share interests.

MM Prop Consultancy Limited, a company owned and

controlled by Michael Murray, who is a member of key

management personnel as per IAS 24, continued to

provide property consultancy services to the Group

during FY22. During FY22 MM Prop Consultancy Limited

was primarily tasked with finding and negotiating the

acquisition of new sites in the UK, Europe and Rest of

the World for both our larger format stores and our

combined retail and gym units but it also provides

advice to the Company’s in-house property team in

relation to existing sites in the UK, Europe and Rest of

the World.

In the year all properties have been assessed

that are considered to have created value across

all the outstanding freehold and long leasehold

properties over the applicable period from the MM

Property Consultancy agreement commencement

to 29 September 2021, they have been valued by an

independent valuer who confirms the value created by

MM Prop Consultancy Limited. The Group’s independent

Non-Executive Directors then review and agree the value

created and have full discretion to approve a payment

to MM Prop Consultancy Limited of up to 25% of the

value created.

On 1 May 2022 Michael Murray was appointed as CEO,

prior to his appointment MM Prop Consultancy Limited

and the Group finalised the terms on which any relevant

prior consultancy services agreements terminated.

The Board has now completed its assessment of the

unsettled value created by MM Prop Consultancy

Limited to the Group, with the assistance of independent

third party experts.

MM Prop Consultancy Limited is entitled to up to 25%

of any value created by services provided to the Group.

MM Prop Consultancy Limited has agreed to waive

contractually due amounts, including part crediting

previous payments under this agreement, such that

the Group receives a 40% discount as part of the

finalisation and cessation of the consultancy agreement.

The final payment to be made by the Group to MM

FRASERS GROUP PLC ANNUAL REPORT 2022

178

Prop Consultancy Limited following the application of

this discount is £20.9m which was paid in the year (FY21:

£2.5m was accrued and subsequently paid in FY22).

During FY21 the Group entered into an agreement

with M.P.M Elevation Limited, a company owned and

controlled by Michael Murray in relation to elevation

strategy services. M.P.M Elevation Limited was paid

£0.1m in relation to the provision of the elevation

strategy services (FY21: £0.1m).

36. ULTIMATE CONTROLLING

PARTY

The Group is controlled by Mike Ashley through his

100% shareholding in Mash Beta Limited and Mash

Holdings Limited, which own 303,507,460 (61.7% of the

issued ordinary share capital of the Company) and

26,492,540 (5.5% of the issued ordinary share capital of

the Company) ordinary shares respectively at the period

end. Mash Holdings Limited is the smallest and largest

company to consolidate these accounts. Mash Holdings

Limited is registered in England and Wales and a copy

of their financial statements can be obtained from

Companies House, Crown Way, Cardiff, CF14 3UZ.

37. POST BALANCE SHEET

EVENTS

On 25 April 2022 and 20 June 2022 the Group

commenced share buyback programmes with the

aggregate purchase price of all shares acquired

under these programmes of no greater than £105.0m

and the maximum number of shares that may be

purchased under the programmes of 15m ordinary

shares with a nominal value of 10p each. The purpose

of the programmes was to reduce the share capital of

the Company. 11,884,438 ordinary shares of 10p each

for consideration of £79.9m were acquired through

these programmes.

On 1 May 2022 Michael Murray was appointed as

Chief Executive Officer of Frasers Group. Mike Ashley

and Michael Murray worked together for a number

of months to ensure a smooth transition into the role.

Michael will accelerate the Group’s strategy to achieve

its vision: “to serve our customers with the World’s best

sports, premium and luxury brands.”

On 16 May 2022 the Group acquired the entire share

capital of leading Danish sport retailer SportMaster. Due

to the proximity of the acquisition date to the date these

financial statements are authorised for issue, the initial

accounting for the business combination is incomplete

and so the disclosures required by IFRS 3 Business

Combinations cannot be made at this stage.

On 25 May 2022 the Group disposed of its US

retail businesses trading as Bobs Stores (“Bobs”)

and Eastern Mountain Sports (“EMS”) for a cash

consideration of $70m to GoDigital Media Group

(“GDMG”). Further details are included within note 16

of the Group financial statements.

On 1 June 2022 the Group acquired certain intellectual

property of the online women’s fashion retailer,

Missguided Limited (in administration), Mennace

Limited (in administration) and Missguided (IP) Limited

for cash consideration of £20.0 million. Due to the

proximity of the acquisition date to the date these

financial statements are authorised for issue, the initial

accounting for the business combination is incomplete

and so the disclosures required by IFRS 3 Business

Combinations cannot be made at this stage.

The Group announced on 22 June 2022 that it has

increased its investment in Hugo Boss AG, and now has

the following interests in the common stock:

• 3,425,000 shares of common stock, representing

4.9% of Hugo Boss’s total share capital

• 18,289,000 shares of common stock via the sale of

put options, representing 26.0% of Hugo Boss’s total

share capital

After taking into account the premium it will receive

under the put options, Frasers Group’s maximum

aggregate exposure in connection with its acquired

interests in Hugo Boss, with the common stock holding

valued at the closing share price on 21 June 2022, is

approximately €900m (c. £770m).

On 28 July 2022 the Group acquired the online fashion

retailer I Saw It First for cash consideration of £1. Due to

the proximity of the acquisition date to the date these

financial statements are authorised for issue, the initial

accounting for the business combination is incomplete

and so the disclosures required by IFRS 3 Business

Combinations cannot be made at this stage.

On 11 August 2022 the Group completed the disposal

of a number of freehold and long leasehold retail

parks held by its wholly owned subsidiaries, to RI

UK 1 Limited for a headline price of £205m. Frasers

Group fascias will operate from leases within these

properties where appropriate. Frasers Group in the

ordinary course of business purchases and sells

properties from time to time and the Group intends to

use the proceeds of sale towards the working capital

of the Group and its operations.

On 17 August 2022 the Group made a cash offer to

acquire the entire issued and to be issued ordinary share

capital of MySale Group plc (‘MySale’) not already held

by Frasers Group at a price of 2 pence per MySale Share.

The offer values the entire issued and to be issued share

capital of MySale not currently held by Frasers Group

FRASERS GROUP PLC ANNUAL REPORT 2022

179

at approximately £13.6 million (not taking into account

the exercise of any outstanding options which may have

vested under the MySale Share Plans or any conversion

event pursuant to the Convertible Loan Notes). On 29

June 2022, Frasers Group acquired 270,666,650 MySale

Shares and, together with the contracts for difference

already held by it, Frasers Group increased its stake

in MySale to 28.7% and became MySale’s largest

shareholder. Since the disclosure of Frasers Group’s

acquisition of this further stake, the market price of

MySale shares has increased.

On 20 September 2022 the Group announced that

Mike Ashley would not be standing for re-election as a

Director at this year’s Annual General Meeting (“AGM”)

and that he will therefore step down from the Board

upon the conclusion of the AGM.

38. PENSIONS

Defined contribution schemes

The group operates a defined contribution retirement

benefit plan for all qualifying employees. The assets of

the plan are held separately from those of the Group in

funds under the control of trustees. The only obligation

of the Group with respect to the retirement benefit plan

is to make the specified contributions. The total expense

recognised in the income statement of £6.5m represents

contributions payable at rates specified by the rules of

the plan.

Defined benefit schemes

On 24 February 2022, as part of the acquisition of Studio

Retail Limited (“SRL”) as documented in note 32, SRL

became the sponsor of the Findel Group Pension Fund

(“The Scheme”) via a Deed of Amendment, Substitution,

Waiver of Liability and Guarantee. Only the costs and

liabilities associated with the Group section of the

Scheme relate to SRL and as such, it is only assets

and liabilities of the Group section that have been

recognised in these consolidated financial statements.

Frasers Group Plc has also guaranteed payments from

Studio Retail Group plc (in administration) to the three

other sections of the Scheme up to a maximum of £0.9m.

As part of the Deed of Amendment, Substitution, Waiver

of Liability and Guarantee, a one off contribution of

£2.0m was made to the Scheme by SRL. Of this amount,

£1.2m is held by the Scheme but is unallocated by the

administrator. This amount has therefore been shown

within the cash position of the Group section of the

pension scheme.

On 11 March 2022, the Trustee signed a full buy-in

contract (i.e. a policy to cover all members’ benefits in

the four sections of the Scheme) with Standard Life.

This insurance policy allows the pension scheme to

have assets that broadly match the benefits paid by

the Scheme. However, SRL retains responsibility for the

Group section of the Scheme until it is fully transferred

to Standard Life. The contract includes the potential to

convert the policy to a full buy-out at an unspecified

point in the future. However, this is expected to only

happen if a number of conditions included in the

contract are met, based on the insurer’s requirements

and a formal request from the Trustee and therefore is

not a certainty. The buy-in has therefore been treated

as an investment decision for accounting purposes, with

the associated remeasurement of plan assets recognised

through Other Comprehensive Income (“OCI”).

Following the Deed of Amendment, Substitution, Waiver

of Liability and Guarantee and the buy-in, no further

contributions to the scheme are anticipated.

The last funding valuation of the Scheme was

undertaken on 5 April 2019 and recorded a surplus of

£1.5m in respect of the Group section. The Scheme is

administered by Barnet Waddingham LLP.

FRASERS GROUP PLC ANNUAL REPORT 2022

180

The latest full actuarial valuation has been updated for IAS 19 purposes to 24 April 2022 by PricewaterhouseCoopers

LLP (“PwC”) using the assumptions detailed below. The results of the IAS 19 valuation are summarised as follows:

24 April 2022 24 February 2022

(£m) (£m)

Fair value of the scheme assets

89.0 120.5

Present value of the funded obligations

(86.8) (93.2)

Surplus in the scheme

2.2 27.3

Plan assets

24 April 2022 24 February 2022

(£m) (£m)

Plan assets comprise:

Fixed interest gilts

- 76.5

Index linked gilts

- 39.6

Annuities

84.8 0.1

Cash

4.2 4.3

Total

89.0 120.5

Movement in the present value of defined benefit obligations

24 April 2022 24 February 2022

(£m) (£m)

On acquisition

(93.2) -

Interest cost

(0.4) -

Effect of changes in demographic assumptions

0.1 -

Effect of changes in financial assumptions

5.7 -

Effect of experience adjustments

(0.4) -

Benefits paid

1.4 -

At end of the period

(86.8) (93.2)

Movement in the fair value of plan assets

24 April 2022 24 February 2022

(£m) (£m)

On acquisition

120.5 -

Scheme expenses

(0.4) -

Interest on assets

0.5 -

Remeasurements

(32.2) -

Employer contributions

2.0 -

Benefits paid

(1.4) -

At end of the period

89.0 120.5

Movement in the pension surplus

24 April 2022 24 February 2022

(£m) (£m)

Surplus on acquisition

27.3 -

Scheme expenses

(0.4) -

Net interest income

0.1 -

Remeasurements

(26.8) -

Employer contributions

2.0 -

Surplus at end of the period

2.2 27.3

FRASERS GROUP PLC ANNUAL REPORT 2022

181

Expense recognised in the Consolidated Income Statement

24 April 2022

(£m)

(i) Included within administrative expenses

Scheme expenses

(0.4)

(ii) Included within finance income

Net interest income

0.1

Amounts recognised in other comprehensive income

24 April 2022

(£m)

Total remeasurements

(26.8)

Actuarial Assumptions

The following are the principal actuarial assumptions at the reporting date:

24 April 2022 24 February 2022

Financial Assumptions

Discount rate for scheme liabilities

3.00% 2.55%

RPI Price Inflation

3.70% 3.65%

CPI Price Inflation (Pre-2030 / Post-2030)

2.70% / 3.70% 2.65% / 3.65%

Rate of increase to pensions in payment in line with RPI inflation (up to 5% per annum)

2.50% 2.50%

Rate of increase to pensions in payment in line with CPI inflation (up to 5% per annum)

3.15% 3.10%

Rate of increase to deferred pensions

3.20% 3.15%

Post retirement mortality (in years)

Current pensioners at 65 - male

86.6yrs 86.6yrs

Current pensioners at 65 - female

87.9yrs 87.9yrs

Current pensioners at 45 - male

88.4yrs 88.4yrs

Current pensioners at 45 - female

89.8yrs 89.8yrs

Demographic Assumptions

Cash Commutation (members taking cash lump sum)

60% 60%

Proportion of members that are married at retirement

70% 70%

The duration, or average term to payment for the benefits due weighted by liability, is around 15 years.

FRASERS GROUP PLC ANNUAL REPORT 2022

182

Risks

Inflation

In projecting the expected future benefit payments, assumptions are made regarding future price inflation. There is a

risk that the actual rate of inflation will be higher than assumed which will increase the cost of providing the benefits

and thus the liability. This would result in additional contributions being required and a deterioration in the solvency

position unless investment returns are similarly higher than expected.

Mortality

It is not possible to predict with any certainty how long members of the Scheme will live, and if members live longer

than expected, additional contributions will be required and the Scheme’s solvency position will deteriorate.

Managing risk

To manage the risks of the Scheme, TPIE exercises were carried out during 2015 and 2016, which resulted in a number

of members transferring out of the Scheme. The TPIE option has now been embedded within the scheme.

IFRIC 14

IFRIC 14 is an interpretation relating to IAS 19 that covers whether pension scheme surpluses can be recognised on the

balance sheet. Based on the circumstances of the Fund and in line with the prior period, management do not believe

that IFRIC 14 impacts the IAS 19 results since the Company has a right to a refund of surplus assets at some point in

the future, and as such have not made any adjustments to the results.

Funding

The Scheme is funded by SRL. During the current period, the company contributed £1.9m to the scheme. The Group

expects to make contributions of £nil in the financial period ended April 2023.

The following table shows the expected future benefit payments for the Findel Group Pension Fund:

Future benefit payments (£m)

2022 - 2031

39.7

2032 - 2041

41.5

2042 - 2051

34.6

2052 - 2061

19.3

2062 - 2071

4.1

2072 - 2081

0.2

2082 - 2091

After 2092

Total

139.4

FRASERS GROUP PLC ANNUAL REPORT 2022

183

39. SUBSIDIARY UNDERTAKINGS

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

18 Montrose Retail Limited

Shirebrook

(1)

11577636 100

2Care4 Limited

Church Bridge House, Henry Street, Accrington, United Kingdom,

BB5 4EE

3806485 100

Activator Brands Limited

Shirebrook

(1)

5344658 100

Activator Products Limited

Shirebrook

(1)

4204611 100

Active Apparel New Corp

Cogency Global Inc. 850 New Burton Road Suite 201 Dover

Delaware 19904; USA

3270168 100

Alpha Developments Stockport Ltd

Shirebrook

(1)

12662564 100

AP Brands Holdings Ltd

12th Floor, Menara Synphony No 5, Jalan Semangat (Jalan

Professor Khoo Kay Kim) , Seksyen 13, 46200 46200 Petaling

Jaya, Selangor Darul Ehsan, Malaysia

4921-A 100

Bellatrix Associates Limited

Clinch’s House, Lord Street, Douglas, Isle of Man, IM99 1RZ,

Isle of Man

111671C 100

Bellatrix Overseas Limited

Clinch’s House, Lord Street, Douglas, Isle of Man, IM99 1RZ,

Isle of Man

128827C 100

Bellatrix Unlimited

Clinch’s House, Lord Street, Douglas, Isle of Man, IM99 1RZ,

Isle of Man

111670C 100

Bob Woolmer Sales Limited

Shirebrook

(1)

2237568 100

Bob’s Stores USA LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

639085 100

Brands & Fashion NV

Leopoldstraat, nr. 79, 2800 Mechelen, Belgium 0477-995-412 99.8

Brands 001 Limited

Shirebrook

(1)

5347540 100

Brands Holdings Limited*

Shirebrook

(1)

4087435 100

Brands Holdings Sponsorship Limited

Shirebrook

(1)

10375418 100

Brands Inc Limited

Shirebrook

(1)

3585719 100

Brasher Leisure Limited

Shirebrook

(1)

999421 100

BSL International Limited

Shirebrook

(1)

2800425 100

Cafe Clo Limited

Shirebrook

(1)

13641982 100

Cafico - Comercio de Artigos de

Desportos S.A.

Via Central de Milheiros no 121, 4475-334, Frguesia de Milherios,

Concelho da Maia, Porto, Portugal

503751804 100

Campri Limited

Shirebrook

(1)

5398677 100

Cardinal Investments S.l

C.C.Puerto Venecia, local 84, Trav. Jardines Reales, 7, 50021

Zaragoza, Spain

B88542766 100

Carlton Sports Company Limited

Shirebrook

(1)

467686 100

Catrinona Investments S.L

C.C.Puerto Venecia, local 84, Trav. Jardines Reales, 7, 50021

Zaragoza, Spain

B88542683 100

CDS IP SA

Parc Industriel, Avenue Ernest, Solvay 29 1480 Saintes, Belgium 406461077 100

Criminal Clothing Limited

Shirebrook

(1)

4184750 100

Cruise Clothing Limited

Martin House, 184 Ingram Street, Glasgow, Scotland, G1 1DN SC382991 100

Curlina Investments S.l

C.C.Puerto Venecia, local 84, Trav. Jardines Reales, 7, 50021

Zaragoza, Spain

B88415369 100

Designer Travel Goods Limited

Shirebrook

(1)

12298797 100

Dink Digital Holdings Limited

Shirebrook

(1)

11143016 100

Donnay International N.V.

Leopoldstraat nr 79, 2800 Mechelen,Belgium 435392220 100

Eastchance Limited

Unit 1903B & 1905, Exchange Tower,, 33 Wang Chiu Road,

Kowloon Bay, Kowloon, Hong Kong

174348 100

Epoch Properties Limited

First Floor La Chasse Chambers St Helier JE2 4UE Jersey 74753 100

Etail Services Limited

Shirebrook

(1)

5146997 100

Evans Cycles Brands Limited

Shirebrook

(1)

11634915 100

Evans Cycles Limited

Shirebrook

(1)

11577650 100

FRASERS GROUP PLC ANNUAL REPORT 2022

184

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

Evans Cycles Property Limited

Shirebrook

(1)

11634939 100

Everlast Australia Limited

Shirebrook

(1)

8103912 100

Everlast Sports International Inc. Corp.

Everlast 42 West 39th St. 3rd Floor New York, New York, 10018 13-2811380 100

Everlast Sports Mfg. Corp.

Corporation Service Company 80 State Street, Albany, New York,

122207-2543, USA

13-1804772 100

Everlast World Boxing Headquarters

Corporation

Corporation Service Company 80 State Street, Albany, New York,

122207-2543, USA

13-1804773 100

Everlast Worldwide Inc.

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

13-3672716 100

Exsports Limited

Shirebrook

(1)

2779040 100

FG (AF Holdings) Limited

Shirebrook

(1)

13281983 100

FG USA Trade Group Limited

Shirebrook

(1)

13216390 100

Firetrap Limited

Shirebrook

(1)

6836684 100

Forever Media Limited

Shirebrook

(1)

8249185 100

Forever Sports Limited

Shirebrook

(1)

9489811 100

Frasers Group (European Holdings) Limited

Shirebrook

(1)

12903845 100

Frasers Group Asia SDN.BHD.

Level 15-2, Bangunan Faber Imperial Court, Jalan Sultan Ismail,

50250 Kuala Lumpur W.P. Malaysia

201901040821 51

Frasers Group Financial Services Limited

Shirebrook

(1)

13191369 100

Frasers Group Loyalty Services Limited

Shirebrook

(1)

13340837 100

FRASERS RETAIL NIGERIA LIMITED

RCO COURT 3-5, SINARI DARANIJO STREET, VICTORIA

ISLAND, LAGOS STATE, Nigeria

1799366 60

Game AR Limited

Basingstoke

(2)

10142852 100

Game Belong Limited

Shirebrook

(1)

12794477 100

Game Digital Holdings Limited

Basingstoke

(2)

7893832 100

Game Digital Limited

Basingstoke

(2)

9040213 100

Game Digital Solutions Limited

Basingstoke

(2)

9476209 100

Game Retail Limited

Basingstoke

(2)

7837246 100

Game Spain Holdings Limited

Basingstoke

(2)

10846702 100

Game Spain Investments Limited

Basingstoke

(2)

10863881 100

Game Stores Iberia SLU

C/ Virgilio 7 - 9, Parcelas 12 - 13, Pozuelo de Alarcon, Madrid,

Spain

B81209751 100

Gelert IP Limited

Shirebrook

(1)

8576185 100

Gelert Limited

Shirebrook

(1)

8576204 100

Global Apparel (HK) Limited

Unit 1903B & 1905, Exchange Tower, 33 Wang Chiu Road,

Kowloon Bay, Kowloon, Hong Kong

1330162 100

Golddigga Brands Limited

Shirebrook

(1)

6636173 100

Gotay Investments S.L

C.C.Puerto Venecia, local 84, Trav. Jardines Reales, 7, 50021

Zaragoza, Spain

B88542709 100

GRMNT Ltd

Shirebrook

(1)

11144039 100

GT-Lines BV

Bert Haanstrakade 2, 1087DN, Amsterdam, Netherlands 17117820 100

Gul IP Limited

Shirebrook

(1)

8612478 100

Gul Watersports Limited

Shirebrook

(1)

7589716 100

Heatons (N.I.) Limited

PO Box BT15EX, 5th Floor Lesley Buildings, 61-65 Fountain Street,

Belfast, Northern Ireland

NI035599 100

Heatons Stores Limited

Heaton House, IDA Business Park, Whitestown, Tallaght, Dublin,

Ireland, D24E932,

509525 100

Heatons Unlimited Company

Heaton House, IDA Business Park, Whitestown, Tallaght, Dublin,

Ireland, D24E932,

11229 100

Heaven or Hell Limited

Shirebrook

(1)

5899282 100

HK Sports & Golf Aktiebolag

Eskiolstorpsvagen 7, 269 96, Bastad, Sweden 556510-8189 100

HOF Ireland Stores Limited

Heaton House, IDA Business Park, Whitestown, Tallaght, Dublin,

Ireland, D24E932

626384 100

FRASERS GROUP PLC ANNUAL REPORT 2022

185

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

Hot Tuna IP Limited

Shirebrook

(1)

6836792 100

House of Fraser Brands Limited

Shirebrook

(1)

10687367 100

House of Fraser Limited

Shirebrook

(1)

10686681 100

International Brand Management Limited*

Shirebrook

(1)

5142123 100

Jack Wills (IP) Limited

Shirebrook

(1)

11775495 100

Jack Wills Property Limited

Shirebrook

(1)

11775643 100

Jack Wills Retail (Ireland ) Limited

Heaton House, IDA Business Park, Whitestown, Tallaght, Dublin,

Ireland, D24E932,

656208 100

Jack Wills Retail Limited

Shirebrook

(1)

11634810 100

James Lillywhites Limited

Shirebrook

(1)

118840 100

Kangol Holdings Limited

Shirebrook

(1)

3317738 100

Kangol Limited

Shirebrook

(1)

3343793 100

Kangol Trustees Limited

Shirebrook

(1)

3505512 100

Karrimor International Limited

Aminaka Kudan Building 6/F, 1-14-17 Kudankita, Chiyoda-ku,

Tokyo, 102-0073, Japan

0100-01-012128 95

Karrimor Limited

Shirebrook

(1)

5215974 100

KooGa IP Limited

Shirebrook

(1)

12402087 100

La Jolla (UK) Limited

Shirebrook

(1)

5737550 100

Lillywhites Limited

Shirebrook

(1)

290939 100

Lonsdale Australia Limited

Shirebrook

(1)

7665885 100

Lonsdale Boxing Limited

Shirebrook

(1)

3912303 100

Lonsdale Sports Limited

Shirebrook

(1)

4430781 100

Lovell Sports (Holdings) Limited

Shirebrook

(1)

9608995 100

Lovell Sports Limited

Shirebrook

(1)

4184358 100

Lovells SP Limited

Shirebrook

(1)

8907509 100

Loyalti Holdings Limited

Shirebrook

(1)

12110637 100

Masters Holders Limited

Shirebrook

(1)

8787718 100

Midtown Ltd

Shirebrook

(1)

9467997 100

Mississippi Manufacturing LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

3470413 100

Mountain Sports LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

6386224 100

Mountain Sports USA LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

7124259 100

Muddyfox IP Limited

Shirebrook

(1)

10246764 100

Muddyfox Limited

Shirebrook

(1)

4187350 100

Nevica IP Limited

Shirebrook

(1)

6836778 100

No Fear Brand Limited

Shirebrook

(1)

5568043 100

No Fear International Limited

Shirebrook

(1)

5532482 100

No Fear USA Limited

Shirebrook

(1)

7712470 100

Olympus Ventures Limited

Shirebrook

(1)

3945752 100

Paddle Sport Limited

Shirebrook

(1)

6836690 100

POD Collection Services Limited

Academy House, 36 Poland Street, London, W1F 7LU,

United Kingdom

9918495 100

Psyche Holdings Limited

Shirebrook

(1)

03438665 100

Psyche Limited

Shirebrook

(1)

02844011 100

Puffa IP Limited

Shirebrook

(1)

10910124 100

Queensberry Boxing IP Limited

Shirebrook

(1)

7929363 100

Queensberry Rules Limited

Shirebrook

(1)

6723660 100

FRASERS GROUP PLC ANNUAL REPORT 2022

186

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

Quentin Investments S.l

C.C.Puerto Venecia, local 84, Trav. Jardines Reales, 7, 50021

Zaragoza, Spain

B88542733 100

Quickreply Limited

Shirebrook

(1)

5904737 100

Republic IP Limited

Shirebrook

(1)

5635015 100

Republic.com Retail Limited

Shirebrook

(1)

8248997 100

Rhapsody Investments (Europe) SA

1 Cote d’Eich, L-1450, Luxembourg B21.60X 100

Roberts 50 USA LLC

c/o Corporation Service Company, 251 Little Falls Drive, County

of New Castle, Wilmington, Delaware, 19808

5186173 100

Runnel Limited

Shirebrook

(1)

9336830 100

S&B Brands Limited

Shirebrook

(1)

5635585 100

SC Sports (SG) PTE LTD

60 Paya Lebar Road, #08-43, Paya Lebar Square, 409051,

Singapore

198203096N 100

SD Equestrian Limited

Shirebrook

(1)

8692780 100

SD Outdoor IP Limited

Shirebrook

(1)

8560252 100

SD Outdoor Limited

Shirebrook

(1)

8560260 100

SDB 2 S.A.

Parc Industriel, Avenue Ernest, Solvay 29 1480 Saintes, Belgium 0848.964.388 100

SDI (Aberdeen 2) Limited

Shirebrook

(1)

12579371 100

SDI (Aberdeen) Limited

Shirebrook

(1)

8512592 100

SDI (Aberwystwyth) Limited

Shirebrook

(1)

2789996 100

SDI (Acqco 5) Limited

Shirebrook

(1)

10162904 100

SDI (Aintree) Limited

Shirebrook

(1)

3352462 100

SDI (Ashford) Limited

Shirebrook

(1)

7848460 100

SDI (Ashington) Limited

Shirebrook

(1)

7849231 100

SDI (Ayr) Limited

Shirebrook

(1)

5528267 100

SDI (Ballymena) Limited

5th Floor, Lesley Buildings, 61-65 Fountain Street, Belfast,

Northern Ireland, BT1 5EX

NI653829 100

SDI (Bangor) Limited

Shirebrook

(1)

5529705 100

SDI (Barrow in Furness) Limited

Shirebrook

(1)

7851574 100

SDI (Belfast) Limited

Shirebrook

(1)

9872471 100

SDI (Berwick) Limited

Shirebrook

(1)

2739957 100

SDI (Betws-y-Coed) Limited

Shirebrook

(1)

6836673 100

SDI (Birkenhead) Limited

Shirebrook

(1)

7849198 100

SDI (Bishop Auckland) Limited

Shirebrook

(1)

3004246 100

SDI (Boucher Road) Limited

Shirebrook

(1)

13808700 100

SDI (Brands 1) Limited

Shirebrook

(1)

11795958 100

SDI (Brands 2) Limited

Shirebrook

(1)

12299584 100

SDI (Brands 3) Limited

Shirebrook

(1)

12299567 100

SDI (Brands 4) Limited

Shirebrook

(1)

12299515 100

SDI (Bridgwater) Limited

Shirebrook

(1)

7852061 100

SDI (Brighton) Limited

Shirebrook

(1)

12579780 100

SDI (Brixton) Limited

Shirebrook

(1)

9127300 100

SDI (Brook ROW) Limited

Shirebrook

(1)

9336806 100

SDI (Brook UK) Limited

Shirebrook

(1)

9340379 100

SDI (Burton) Limited

Shirebrook

(1)

8495632 100

SDI (Cardiff Flannels) Limited

Shirebrook

(1)

10177359 100

SDI (CARDIFF QS 2) LTD

Shirebrook

(1)

11227321 100

SDI (Cardiff QS) Limited

Shirebrook

(1)

12578045 100

SDI (Carlisle) Limited

Shirebrook

(1)

7851959 100

SDI (Chatham) Limited

Shirebrook

(1)

6836679 100

SDI (Cheshunt 2) Limited

Shirebrook

(1)

11775717 100

SDI (Cheshunt) Limited

Shirebrook

(1)

11775599 100

FRASERS GROUP PLC ANNUAL REPORT 2022

187

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

SDI (Clacton) Limited

Shirebrook

(1)

7852078 100

SDI (Clonmel) Limited

5th Floor, Lesley Buildings, 61-65 Fountain Street, Belfast,

Northern Ireland, BT1 5EX

NI653359 100

SDI (Colchester) Limited

Shirebrook

(1)

5632790 100

SDI (Corby) Limited

Shirebrook

(1)

10885672 100

SDI (Cork) Limited

Shirebrook

(1)

11775763 100

SDI (Coventry) Limited

Shirebrook

(1)

9680128 100

SDI (Darlington) Limited

Shirebrook

(1)

10915193 100

SDI (Derby) Limited

Shirebrook

(1)

9310031 100

SDI (Derry) Limited

5th Floor, Lesley Buildings, 61-65 Fountain Street, Belfast,

Northern Ireland, BT1 5EX

NI653340 100

SDI (Doncaster) Limited

Shirebrook

(1)

9888670 100

SDI (Dundee) Limited

Shirebrook

(1)

9702004 100

SDI (Dunfermline) Limited

Shirebrook

(1)

8483679 100

SDI (East Ham) Limited

Shirebrook

(1)

9810378 100

SDI (East Kilbride) Limited

Shirebrook

(1)

6656368 100

SDI (Edinburgh) Limited

Shirebrook

(1)

10100990 100

SDI (Enfield) Limited

Shirebrook

(1)

10086209 100

SDI (Fulham) Limited

Shirebrook

(1)

7852037 100

SDI (Gainsborough) Limited

Shirebrook

(1)

6338907 100

SDI (Galashiels) Limited

Shirebrook

(1)

7852091 100

SDI (Glasgow Argyle ST) Limited

Shirebrook

(1)

11227937 100

SDI (Glasgow Fort) Limited

Shirebrook

(1)

9861504 100

SDI (Glasgow Frasers) Limited

Shirebrook

(1)

11531596 100

SDI (Glasgow Ingram Street) Limited

Shirebrook

(1)

9925519 100

SDI (Gloucester) Limited

Shirebrook

(1)

7852067 100

SDI (Great Yarmouth) Limited

Shirebrook

(1)

11732687 100

SDI (Hanley) Limited

Shirebrook

(1)

11228017 100

SDI (Hastings) Limited

Shirebrook

(1)

8625893 100

SDI (Hereford) Limited

Shirebrook

(1)

9888642 100

SDI (Hofco) Limited

Shirebrook

(1)

8319960 100

SDI (HoH Holdings) Limited

Shirebrook

(1)

10161592 100

SDI (Hounslow) Limited

Shirebrook

(1)

10086218 100

SDI (Hull) Limited

Shirebrook

(1)

9638564 100

SDI (Ipswich 2) Limited

Shirebrook

(1)

12578948 100

SDI (Ipswich) Limited

Shirebrook

(1)

9788411 100

SDI (Isle of Man) Limited

Shirebrook

(1)

9901745 100

SDI (Jersey Holding) Limited

Shirebrook

(1)

10177028 100

SDI (K Lynn) Limited

Shirebrook

(1)

10073076 100

SDI (Keighley) Limited

Shirebrook

(1)

6260239 100

SDI (Kendal) Limited

Shirebrook

(1)

6338918 100

SDI (Kentish Town) Limited

Shirebrook

(1)

9901702 100

SDI (Kidderminster) Limited

Shirebrook

(1)

9203731 100

SDI (Kilmarnock) Limited

Shirebrook

(1)

7853433 100

SDI (Kingston) Limited

Shirebrook

(1)

10915209 100

SDI (Kirkcaldy) Limited

Shirebrook

(1)

7852097 100

SDI (Leeds 2) Limited

Shirebrook

(1)

13808640 100

SDI (Leeds) Limited

Shirebrook

(1)

9293515 100

SDI (Leicester) Limited

Shirebrook

(1)

9127170 100

SDI (Liverpool) Limited

Shirebrook

(1)

9888734 100

FRASERS GROUP PLC ANNUAL REPORT 2022

188

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

SDI (Lowestoft) Limited

Shirebrook

(1)

7852265 100

SDI (LSL Holdings) Limited

Shirebrook

(1)

10161824 100

SDI (Manchester Cheetham Hill) Limited

Shirebrook

(1)

10100969 100

SDI (Manchester Denton) Limited

Shirebrook

(1)

9127295 100

SDI (Market Road) Limited

Shirebrook

(1)

10799247 100

SDI (Middlesbrough) Limited

Shirebrook

(1)

10081909 100

SDI (Nassau Street) Limited

Shirebrook

(1)

11227964 100

SDI (Neath) Limited

Shirebrook

(1)

7853548 100

SDI (Newark) Limited

Shirebrook

(1)

7853470 100

SDI (Newcastle) Limited

Shirebrook

(1)

9127286 100

SDI (Newport IOW) Ltd

Shirebrook

(1)

12578944 100

SDI (Newport) Limited

Shirebrook

(1)

8679118 100

SDI (Newquay) Limited

Shirebrook

(1)

10089800 100

SDI (Newry) Limited

5th Floor, Lesley Buildings, 61-65 Fountain Street, Belfast,

Northern Ireland, BT1 5EX

NI653358 100

SDI (Newton Abbot) Limited

Shirebrook

(1)

6836666 100

SDI (Newtownabbey) Limited

Shirebrook

(1)

9127266 100

SDI (NFSK) Limited

Shirebrook

(1)

10919102 100

SDI (Northampton) Limited

Shirebrook

(1)

7852272 100

SDI (Northwich) Limited

Shirebrook

(1)

5656295 100

SDI (Nottingham) Limited

Shirebrook

(1)

10100609 100

SDI (Nuneaton) Limited

Shirebrook

(1)

7852249 100

SDI (Oswestry) Limited

Shirebrook

(1)

7852363 100

SDI (Oxford Street) Limited

Shirebrook

(1)

10046080 100

SDI (Penzance) Limited

Shirebrook

(1)

7852297 100

SDI (Peterlee) Limited

Shirebrook

(1)

7852401 100

SDI (Plymouth Flannels) Limited

Shirebrook

(1)

9127387 100

SDI (Plymouth) Limited

Shirebrook

(1)

9470468 100

SDI (Portsmouth) Limited

Shirebrook

(1)

12579294 100

SDI (Preston) Limited

Shirebrook

(1)

10915199 100

SDI (Propco 100) Limited

Shirebrook

(1)

11732700 100

SDI (Propco 101) Limited

Shirebrook

(1)

11773466 100

SDI (Propco 102) Limited

Shirebrook

(1)

11775629 100

SDI (Propco 105) Limited

Shirebrook

(1)

11775597 100

SDI (Propco 107) Limited

Shirebrook

(1)

11775706 100

SDI (Propco 111) Limited

Shirebrook

(1)

11775722 100

SDI (Propco 112) Limited

Shirebrook

(1)

9127160 100

SDI (Propco 114) Limited

Shirebrook

(1)

12298708 100

SDI (Propco 115) Limited

Shirebrook

(1)

12300052 100

SDI (Propco 116) Limited

Shirebrook

(1)

12332460 100

SDI (Propco 117) Limited

Shirebrook

(1)

12332456 100

SDI (Propco 118) Limited

Shirebrook

(1)

12332859 100

SDI (Propco 119) Limited

Shirebrook

(1)

12332862 100

SDI (Propco 125) Limited

Shirebrook

(1)

12577378 100

SDI (Propco 134) Limited

Shirebrook

(1)

9625631 100

SDI (Propco 139) Limited

Shirebrook

(1)

13808689 100

SDI (Propco 141) Limited

Shirebrook

(1)

13808701 100

SDI (Propco 142) Limited

Shirebrook

(1)

13808704 100

SDI (Propco 35) Limited

Shirebrook

(1)

11500282 100

SDI (Propco 36) Limited

Shirebrook

(1)

11523336 100

FRASERS GROUP PLC ANNUAL REPORT 2022

189

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

SDI (Propco 37) Limited

Shirebrook

(1)

11523343 100

SDI (Propco 38) Limited

Shirebrook

(1)

11523424 100

SDI (Propco 39) Limited

Shirebrook

(1)

11523440 100

SDI (Propco 40) Limited

Shirebrook

(1)

11523489 100

SDI (Propco 41) Limited

Shirebrook

(1)

11523621 100

SDI (Propco 43) Limited

Shirebrook

(1)

11523609 100

SDI (Propco 44) Limited

Shirebrook

(1)

11523608 100

SDI (Propco 46) Limited

Shirebrook

(1)

11523748 100

SDI (Propco 47) Limited

Shirebrook

(1)

11530370 100

SDI (Propco 49) Limited

Shirebrook

(1)

11526115 100

SDI (Propco 50) Limited

Shirebrook

(1)

11526182 100

SDI (Propco 51) Limited

Shirebrook

(1)

11527237 100

SDI (Propco 52) Limited

Shirebrook

(1)

11526972 100

SDI (Propco 55) Limited

Shirebrook

(1)

11527303 100

SDI (Propco 56) Limited

Shirebrook

(1)

11527382 100

SDI (Propco 57) Limited

Shirebrook

(1)

11527500 100

SDI (Propco 58) Limited

Shirebrook

(1)

11527596 100

SDI (Propco 60) Limited

Shirebrook

(1)

11531386 100

SDI (Propco 61) Limited

Shirebrook

(1)

11531382 100

SDI (Propco 62) Limited

Shirebrook

(1)

11531444 100

SDI (Propco 63) Limited

Shirebrook

(1)

11531503 100

SDI (Propco 64) Limited

Shirebrook

(1)

11531506 100

SDI (Propco 65) Limited

Shirebrook

(1)

11531532 100

SDI (Propco 67) Limited

Shirebrook

(1)

11572676 100

SDI (Propco 69) Limited

Shirebrook

(1)

11572830 100

SDI (Propco 70) Limited

Shirebrook

(1)

11572933 100

SDI (Propco 71) Limited

Shirebrook

(1)

11574887 100

SDI (Propco 73) Limited

Shirebrook

(1)

11575050 100

SDI (Propco 75) Limited

Shirebrook

(1)

11577256 100

SDI (Propco 76) Limited

Shirebrook

(1)

11577617 100

SDI (Propco 77) Limited

Shirebrook

(1)

11578164 100

SDI (Propco 80) Limited

Shirebrook

(1)

11577670 100

SDI (Propco 81) Limited

Shirebrook

(1)

11641123 100

SDI (Propco 83) Limited

Shirebrook

(1)

11646302 100

SDI (Propco 85) Limited

Shirebrook

(1)

11649632 100

SDI (Propco 86) Limited

Shirebrook

(1)

11649235 100

SDI (Propco 87) Limited

Shirebrook

(1)

11649336 100

SDI (Propco 88) Limited

Shirebrook

(1)

11674753 100

SDI (Propco 90) Limited

Shirebrook

(1)

11649431 100

SDI (Propco 91) Limited

Shirebrook

(1)

11687077 100

SDI (Propco 92) Limited

Shirebrook

(1)

11730204 100

SDI (Propco 93) Limited

Shirebrook

(1)

11730253 100

SDI (Propco 94) Limited

Shirebrook

(1)

11730440 100

SDI (Propco 96) Limited

Shirebrook

(1)

11730503 100

SDI (Propco 98) Limited

Shirebrook

(1)

11730868 100

SDI (Propco 99) Limited

Shirebrook

(1)

11732772 100

SDI (Ramsgate) Limited

Shirebrook

(1)

7852250 100

SDI (Reading) Limited

Shirebrook

(1)

10422164 100

SDI (Redcar) Limited

Shirebrook

(1)

2731452 100

SDI (Retail Co 10) Limited

Shirebrook

(1)

11689119 100

FRASERS GROUP PLC ANNUAL REPORT 2022

190

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

SDI (Retail Co 11) Limited

Shirebrook

(1)

12298852 100

SDI (Retail Co 13) Limited

Shirebrook

(1)

12298767 100

SDI (Retail Co 4) Limited

Shirebrook

(1)

11635011 100

SDI (Retail Co 7) Limited

Shirebrook

(1)

11687276 100

SDI (Retail Co 8) Limited

Shirebrook

(1)

11687376 100

SDI (Retail Co 9) Limited

Shirebrook

(1)

11689077 100

SDI (Rolle St) Limited

Shirebrook

(1)

7852669 100

SDI (Romford) Limited

Shirebrook

(1)

10071547 100

SDI (Rotherham) Limited

Shirebrook

(1)

9888635 100

SDI (Salisbury) Ltd

Shirebrook

(1)

10107572 100

SDI (Scarborough) Limited

Shirebrook

(1)

6328463 100

SDI (Scunthorpe Parishes Centre) Limited

Shirebrook

(1)

11730442 100

SDI (Scunthorpe) Limited

Shirebrook

(1)

7852055 100

SDI (Southampton 2) Limited

Shirebrook

(1)

9665889 100

SDI (Southampton) Limited

Shirebrook

(1)

8512480 100

SDI (Southport) Limited

Shirebrook

(1)

9888806 100

SDI (St Austell) Limited

Shirebrook

(1)

7852284 100

SDI (St Helens) Limited

Shirebrook

(1)

7852281 100

SDI (Stafford Riverside) Limited

Shirebrook

(1)

8972499 100

SDI (Stafford) Limited

Shirebrook

(1)

8568681 100

SDI (Staines) Limited

Shirebrook

(1)

11646482 100

SDI (Stockport) Limited

Shirebrook

(1)

6372181 100

SDI (Stoke Longton) Limited

Shirebrook

(1)

7853877 100

SDI (Stoke Newington) Limited

Shirebrook

(1)

7852207 100

SDI (Strabane) Limited

Shirebrook

(1)

9890243 100

SDI (Streatham) Limited

Shirebrook

(1)

10066335 100

SDI (Strood) Limited

Shirebrook

(1)

7852251 100

SDI (Sunderland) Limited

Shirebrook

(1)

8755347 100

SDI (Sutton) Limited

Shirebrook

(1)

11228011 100

SDI (Swindon) Limited

Shirebrook

(1)

9888662 100

SDI (Taunton) Limited

Shirebrook

(1)

7852191 100

SDI (Thanet) Limited

Shirebrook

(1)

12579034 100

SDI (The House Yarm) Limited

Shirebrook

(1)

12332871 100

SDI (The Lion Hotel) Limited

Shirebrook

(1)

6836880 100

SDI (Thurrock) Limited

Shirebrook

(1)

10089743 100

SDI (Trowbridge) Limited

Shirebrook

(1)

12355661 100

SDI (Uxbridge 2) Limited

Shirebrook

(1)

9127316 100

SDI (Uxbridge) Limited

Shirebrook

(1)

10177276 100

SDI (Wakefield) Limited

Shirebrook

(1)

8483711 100

SDI (Walsall) Limited

Shirebrook

(1)

7852289 100

SDI (Watford) Limited

Shirebrook

(1)

6328505 100

SDI (Widnes) Limited

Shirebrook

(1)

8576472 100

SDI (Wigan) IP Limited

Shirebrook

(1)

6835407 100

SDI (Wigan) Limited

Shirebrook

(1)

12579287 100

SDI (Wishaw) Limited

Shirebrook

(1)

6656365 100

SDI (Wrexham) Limited

Shirebrook

(1)

10915200 100

SDI (Wythenshawe) Limited

Shirebrook

(1)

9659156 100

SDI (Yeovil) Limited

Shirebrook

(1)

12577947 100

SDI (York) Limited

Shirebrook

(1)

11331391 100

FRASERS GROUP PLC ANNUAL REPORT 2022

191

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

SDI 2300 Collins LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

6870031 100

SDI 735 Collins LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

68700128 100

SDI Aviation Limited*

Shirebrook(1) 9633152 100

SDI Corrib Shopping Centre Limited

HEATON HOUSE , IDA BUSINESS PARK, WHITESTOWN,

TALLAGHT, DUBLIN 24, Ireland

715322 100

SDI Fitness (Bury St Edmunds) Limited

Shirebrook

(1)

9038949 100

SDI Fitness (Cheltenham) Limited

Shirebrook

(1)

9039840 100

SDI Fitness (Colchester) Limited

Shirebrook

(1)

9039011 100

SDI Fitness (Croydon) Limited

Shirebrook

(1)

9039243 100

SDI Fitness (DW) Limited

Shirebrook

(1)

12298794 100

SDI Fitness (Epsom) Limited

Shirebrook

(1)

9039043 100

SDI Fitness (Glasgow) Limited

Shirebrook

(1)

9038811 100

SDI Fitness (Guildford) Limited

Shirebrook

(1)

9039269 100

SDI Fitness (Hove) Limited

Shirebrook

(1)

9039030 100

SDI Fitness (Huntingdon) Limited

Shirebrook

(1)

9039881 100

SDI Fitness (K Heath) Limited

Shirebrook

(1)

9039717 100

SDI Fitness (K Lynn) Limited

Shirebrook

(1)

9039847 100

SDI Fitness (Kettering) Limited

Shirebrook

(1)

9039852 100

SDI Fitness (Lincoln City) Limited

Shirebrook

(1)

9039331 100

SDI Fitness (Liverpool) Limited

Shirebrook

(1)

9039347 100

SDI Fitness (Manchester) Limited

Shirebrook

(1)

9039339 100

SDI Fitness (Milngavie) Limited

Shirebrook

(1)

9039510 100

SDI Fitness (NI 1) Limited

c/o Kennedys, 10th Floor, River House, 48-60 High Street, Belfast,

Northern Ireland, BT1 2BE, United Kingdom

NI672034 100

SDI Fitness (NI 2) Limited

c/o Kennedys, 10th Floor, River House, 48-60 High Street, Belfast,

Northern Ireland, BT1 2BE, United Kingdom

NI672033 100

SDI Fitness (NI 3) Limited

c/o Kennedys, 10th Floor, River House, 48-60 High Street, Belfast,

Northern Ireland, BT1 2BE, United Kingdom

NI672035 100

SDI Fitness (NI 4) Limited

c/o Kennedys, 10th Floor, River House, 48-60 High Street, Belfast,

Northern Ireland, BT1 2BE, United Kingdom

NI672885 100

SDI Fitness (NI 5) Limited

c/o Kennedys, 10th Floor, River House, 48-60 High Street, Belfast,

Northern Ireland, BT1 2BE, United Kingdom

NI672884 100

SDI Fitness (Northfield) Limited

Shirebrook

(1)

9039412 100

SDI Fitness (Rugby) Limited

Shirebrook

(1)

9039408 100

SDI Fitness (Sale) Limited

Shirebrook

(1)

9039405 100

SDI Fitness (Salisbury) Limited

Shirebrook

(1)

9039429 100

SDI Fitness 1 Limited

Shirebrook

(1)

12371923 100

SDI Fitness 10 Limited

Shirebrook

(1)

12372368 100

SDI Fitness 11 Limited

Shirebrook

(1)

12820382 100

SDI Fitness 12 Limited

Shirebrook

(1)

12821058 100

SDI Fitness 13 Limited

Shirebrook

(1)

12820585 100

SDI Fitness 14 Limited

Shirebrook

(1)

12820516 100

SDI Fitness 15 Limited

Shirebrook

(1)

12822245 100

SDI Fitness 16 Limited

Shirebrook

(1)

12822564 100

SDI Fitness 17 Limited

Shirebrook

(1)

12822692 100

SDI Fitness 18 Limited

Shirebrook

(1)

12822794 100

SDI Fitness 19 Limited

Shirebrook

(1)

12822856 100

SDI Fitness 2 Limited

Shirebrook

(1)

12372165 100

SDI Fitness 20 Limited

Shirebrook

(1)

12823728 100

FRASERS GROUP PLC ANNUAL REPORT 2022

192

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

SDI Fitness 21 Limited

Shirebrook

(1)

12823572 100

SDI Fitness 22 Limited

Shirebrook

(1)

12823510 100

SDI Fitness 23 Limited

Shirebrook

(1)

12823786 100

SDI Fitness 24 Limited

Shirebrook

(1)

12823986 100

SDI Fitness 25 Limited

Shirebrook

(1)

12823926 100

SDI Fitness 26 Limited

Shirebrook

(1)

12825248 100

SDI Fitness 27 Limited

Shirebrook

(1)

12830411 100

SDI Fitness 28 Limited

Shirebrook

(1)

12825356 100

SDI Fitness 29 Limited

Shirebrook

(1)

12825569 100

SDI Fitness 3 Limited

Shirebrook

(1)

12372169 100

SDI Fitness 30 Limited

Shirebrook

(1)

12825721 100

SDI Fitness 31 Limited

Shirebrook

(1)

12930743 100

SDI Fitness 32 Limited

Shirebrook

(1)

12930838 100

SDI Fitness 33 Limited

Shirebrook

(1)

12930826 100

SDI Fitness 34 Limited

Shirebrook

(1)

12930829 100

SDI Fitness 35 Limited

Shirebrook

(1)

12930938 100

SDI Fitness 36 Limited

Shirebrook

(1)

12930954 100

SDI Fitness 37 Limited

Shirebrook

(1)

12930944 100

SDI Fitness 38 Limited

Shirebrook

(1)

09038724 100

SDI Fitness 39 Limited

Shirebrook

(1)

09038768 100

SDI Fitness 4 Limited

Shirebrook

(1)

12372174 100

SDI Fitness 40 Limited

Shirebrook

(1)

09038881 100

SDI Fitness 41 Limited

Shirebrook

(1)

09038839 100

SDI Fitness 42 Limited

Shirebrook

(1)

09038943 100

SDI Fitness 43 Limited

Shirebrook

(1)

09039023 100

SDI Fitness 44 Limited

Shirebrook

(1)

09039343 100

SDI Fitness 45 Limited

Shirebrook

(1)

09039481 100

SDI Fitness 46 Limited

Shirebrook

(1)

13030435 100

SDI Fitness 47 Limited

Shirebrook

(1)

13030364 100

SDI Fitness 48 Limited

Shirebrook

(1)

13030107 100

SDI Fitness 49 Limited

Shirebrook

(1)

13030173 100

SDI Fitness 5 Limited

Shirebrook

(1)

12372199 100

SDI Fitness 50 Limited

Shirebrook

(1)

13030175 100

SDI Fitness 6 Limited

Shirebrook

(1)

12372224 100

SDI Fitness 7 Limited

Shirebrook

(1)

12372218 100

SDI Fitness 8 Limited

Shirebrook

(1)

12372305 100

SDI Fitness 9 Limited

Shirebrook

(1)

12372303 100

SDI Four Limited

Shirebrook

(1)

9719779 100

SDI Gift Card LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

S6773735 100

SDI Golf Limited

Shirebrook

(1)

9083512 100

SDI Holdings USA inc

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

6651201 100

SDI Lifestyle Limited

Shirebrook

(1)

8293614 100

SDI Properties (USA) Inc.

Corporation Service Company, 2 Office Park Court, Suite 103

Columbia

535872 100

SDI Properties (Wiagn) Limited

Shirebrook

(1)

6836522 100

SDI Property (Europe) B.V.

Van Konijnenburgweg 45, 4672PL Bergen op Zoom Netherlands 69042594 100

SDI Property (Evans Cycles) Limited

Shirebrook

(1)

11646219 100

FRASERS GROUP PLC ANNUAL REPORT 2022

193

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

SDI Property Limited*

Shirebrook

(1)

2767493 100

SDI Property US Inc

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

68700024 100

SDI Property US Limited

Shirebrook

(1)

11323420 100

SDI Retail Services Limited

Shirebrook

(1)

8143303 100

SDI Sport London Limited

Shirebrook

(1)

9848767 100

SDI Sports (Stoke) Limited

Shirebrook

(1)

10163722 100

SDI Sports Group Americas LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

2047393 100

SDI Stores LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

1240332 100

SDI Ventures LLC

The Corporation Trust Company, Corporation Trust Center, 1209

Orange Street, Wilmington, New Castle County DE 19801,

United States

6870023 100

SDI Property (Bitburg) B.V.

Netherlands 82495807 100

SDI.com Fitness Parent Limited*

Shirebrook

(1)

9082454 100

SDIL S.A.

Parc Industriel, Avenue Ernest, Solvay 29 1480 Saintes, Belgium 810.198.636 100

SIA SIG Logistics

A. Deglava str 50 LV-1-35 Riga Latvia 4020311076 60

SIA Sportland

A. Deglava str 50 LV-1-35 Riga Latvia 40003530961 60

SIA Sportsdirect.com

A. Deglava str 50 LV-1-35 Riga Latvia 40103932873 60

Sienna Dining Limited

Shirebrook

(1)

13629737 100

Ski and Outdoor Warehouse Limited

Shirebrook

(1)

2917223 100

Skins IP Limited

Shirebrook

(1)

12168568 100

Slazenger Carlton (Holdings) Limited

Shirebrook

(1)

10463051 100

Slazengers Australia Limited

Shirebrook

(1)

9217319 100

Slazengers Limited

Shirebrook

(1)

116000 100

Smith & Brooks Limited

Shirebrook

(1)

2073720 100

Smith And Brooks Group Limited

Shirebrook

(1)

4079331 100

Smith And Brooks Holdings Limited

Shirebrook

(1)

4983573 100

SNÖ Sport Vertriebs GmbH

Flugplatzstraße 30, 4600, Wels Austria 272671 m 100

Sofa.com Bidco Limited

Shirebrook

(1)

9341955 100

Sofa.com BV

Flaas 4 V 6, Den Dungen, 5275HH, Netherlands 17196766 100

Sofa.com Ltd

Shirebrook

(1)

5222498 100

Sondico IP Limited

Shirebrook

(1)

6546121 100

Sport Eybl & Sports Experts Logistikbetriebs

GmbH

Flugplatzstraße 30, 4600, Wels Austria FN 96024 m 100

Sport Eybl Holding GmbH

Flugplatzstraße 30, 4600, Wels Austria 180095 x 100

Sportdirect.com China Pte Limited

C25, 3rd Floor, ASEAN Building, 690 Minzhi Avenue, Xinniu

Community, Minzhi Street, Longhua District, Shenzhen, China

91440300579987503D 100

Sportland Eestie A.S.

Parnu mnt 139c Kesklinna, Tallinn Estonia 11317 10677712 60

Sportland International Group A.S.

Parnu mnt 139c Kesklinna, Tallinn Estonia 11317 10993195 60

Sports Direct (Singapore) Pte.Ltd

6 Eu Tong Sen Street, #11-09, The Central, 059817, Singapore 202004542Z 51

Sports Direct Holdings Limited*

Shirebrook

(1)

6464317 100

Sports Direct International Holdings Limited*

Shirebrook

(1)

6027131 100

Sports Direct International Limited

Shirebrook

(1)

11775757 100

Sports Direct Malaysia Sdn. Bhd.

Level 15-2. Bangunan Faber Imperial Court Jalan Sultan Ismail

52200 Kuala Lumpur Malaysia

925116-M 51

Sports World International Limited

Shirebrook

(1)

6531266 100

Sports World The Netherlands B.V.

Van Konijenburgweg 45, 4612 PL Bergen op zoom, Netherlands 34056291 100

Sportsdirect (Iceland) ehf

Skogarlind 2, 201, Kopavogur, Iceland 6301121760 100

FRASERS GROUP PLC ANNUAL REPORT 2022

194

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

Sportsdirect.com (Asia) Ltd

Unit 1903B & 1905, Exchange Tower,, 33 Wang Chiu Road,

Kowloon Bay, Kowloon, Hong Kong

1216339 100

Sportsdirect.com (Shanghai) Limited

Room 315, 3rd Floor Building 2, No 239 Gang’ao Road, China

(Shanghai) Pilot Free Zone, Shanghai, China

91310115MA1K463A6B 95

Sportsdirect.com (Taiwan) Limited

17F.-5, No.500, Shizheng Rd., , Xitun District, 40757, Taiwan 82770619 95

Sportsdirect.com Austria GmbH

Flugplatzstraße 30, 4600, Wels Austria 309738 y 100

Sportsdirect.com Belgium S.A.

Parc Industriel, Avenue Ernest, Solvay 29 1480 Saintes, Belgium 416.268.471 100

Sportsdirect.com Cyprus Limited

Miltiades Stylianou 34B, Shop 2, 8577 Tala, Paphos, Cyprus HE 230340 100

Sportsdirect.com Czech Republic s.r.o.

Prague 1 - Nove Mesto, Na Porici 1079/3a, 100 00,

Czech Republic

24268933 100

Sportsdirect.com Fitness Limited

Shirebrook

(1)

9028577 100

Sportsdirect.com France

Zac des Brateaux, Rue des Brateaux, 9100, Villabe, France FR27379062813 100

Sportsdirect.com Hungary Kft

H-1053 Budapest, Karolyi Mihaly utca 12, Hungary 01-09-986824 100

Sportsdirect.com Immobilien GmbH

Flugplatzstraße 30, 4600, Wels Austria 104151 p 100

Sportsdirect.com Malta Limited

Brewery Street, Zone 3 Central Business District Birkirkara CBD

3040 Malta

C99278 100

Sportsdirect.com OU

Parnu mnt 139c, Kesklinna, Tallinn, 11318, Estonia 1285837 100

Sportsdirect.com Poland S.P.Z.oo

5 Składowa Street, 61-888 Poznań,, Poland , 00-872, Warsaw 452610 100

Sportsdirect.com Pty Ltd

c/o Norton Rose Fulbright, L11, 485 Bourke Street, Melbourne VIC

3000, Australia

603 187 319 100

Sportsdirect.com Retail (Europe) S.A.*

Parc Industriel, Avenue Ernest, Solvay 29 1480 Saintes, Belgium 458883046 100

Sportsdirect.com Retail Limited*

Shirebrook

(1)

3406347 100

Sportsdirect.com S.L.U. Spain

Centro Comercial Puerto Venecia, Local 84, Travesía de los

Jardines Reales nº 7, 50021, Zaragoza , Spain

B-86567880 100

Sportsdirect.com Slovakia s.r.o.

Vysoka 2/B, 81106, Bratislava, Slovakia 47 240 458 100

Sportsdirect.com SLVN d.o.o.

Planjava 4, 1236 Trzin, Slovenia 1198157000 100

Sportsdirect.com Switzerland A.G.

Switzerland CHE-

Zeughausgasse 27, 3011 Bern, Switzerland 331.683.991 100

Sportsdirect.com Vienna North GmbH

Wels, Flugplatzstrabe 30 FN104486G 100

SSG Sport GmbH (SSD)

Vornholzstr. 48, , 94036, Passau, Germany HRB 7134 100

Sterling Resources (Holdings) Limited

Shirebrook

(1)

4651701 100

Sterling Resources Limited

Shirebrook

(1)

1413254 100

Stirlings (Argyle Street) Limited

Martin House, 184 Ingram Street, Glasgow, Scotland, G1 1DN SC088108 100

Straub Corporation Limited

Shirebrook

(1)

3003584 100

Studio Asia Limited

Unit 1506, Tower A, Financial Street Hailun Centre No.440, Hailun

Road, Shanghai, PRC

9131000MA1G5FKRX1 100

Studio Financing Limited

8th Floor 100 Bishopsgate, London, United Kingdom, EC2N 4AG 11644219 (3)

Studio Online Limited

Church Bridge House, Henry Street, Accrington, United Kingdom,

BB5 4EE

3994833 100

Studio Retail Limited

Church Bridge House, Henry Street, Accrington, United Kingdom,

BB5 4EE

718151 100

Suplay Investments S.l.

C.C.Puerto Venecia, local 84, Trav. Jardines Reales, 7, 50021

Zaragoza, Spain

B88542691 100

SwImmo Eupen SPRL

Parc Industriel, Avenue Ernest, Solvay 29 1480 Saintes, Belgium 878673906 100

Table Tennis Pro Europe Ltd

Shirebrook

(1)

5003853 100

The Antigua Group Inc

3773 Howard Huges Pkway, STE 500S Las vegas, Nevada, USA

89169-6014

0734679-4 100

THE FLANNELS GROUP (ROI) LIMITED

HEATON HOUSE , IDA BUSINESS PARK, WHITESTOWN,

TALLAGHT, DUBLIN 24, Ireland

707468 100

The Flannels Group Limited

Shirebrook

(1)

2318510 100

The Trademark Licensing Company Limited

Shirebrook

(1)

4477829 100

Total Estates Limited

Shirebrook

(1)

4958214 100

Tri Yeovil UK Limited

Shirebrook

(1)

10680690 100

UAB SDI (Gedimino) LT

Seimyniskiu g. 3, Vilnius, Lithuania 135039836 100

FRASERS GROUP PLC ANNUAL REPORT 2022

195

NAME REGISTERED OFFICE ADDRESS COMPANY NUMBER

PERCENTAGE OF

ISSUED SHARE

CAPITAL HELD

UAB Sportland LT

Seimyniskiu g. 3, Vilnius, Lithuania 135039836 51

UAB Sportsdirect.com

Seimyniskiu g. 3, Vilnius, Lithuania 304155613 100

Universal Cycles Limited

Shirebrook

(1)

1339667 100

USA Pro IP Limited

Shirebrook

(1)

6497914 100

USC IP Limited

Shirebrook

(1)

6836808 100

Van Mildert (Lifestyle) Limited

Shirebrook

(1)

8319959 100

Voodoo Dolls Brand Limited

Shirebrook

(1)

5323305 100

Wareshop2 Limited

Shirebrook

(1)

9870840 100

Warrnambool *

Heaton House , IDA Business Park, Whitestown, Tallaght, Dublin

24, Ireland

387014 100

Waterline Angling Products Limited

Shirebrook

(1)

2696374 100

West Coast Capital (HOFCO) Limited

15 Atholl Crescent, Edinburgh, EH3 8HA SC437614 100

Westminster Manufacturing LLC

2 Office Park Court , Suite 103, Coumbia SC 29233 USA 44358 100

Yeomans Outdoors Limited

Shirebrook

(1)

8058714 100

Yubel International Trade Co Limited

Room 5C, No561 Ouyang Road, Hongkou District, Shanghai

91310000MA1G5FKRX1

100

Zaparoh SPz.o.o

ul. Żernicka 22, Robakowo, 62-023 Gądki, Poland KRS 0000459435 100

(1) Unit A, Brook Park East, Shirebrook, NG20 8RY

(2) Unity House, Telford Road, Basingstoke, Hampshire, RG21 6YJ

(3) A controlled entity other than by share ownership

* Direct shareholdings held by Frasers Group Plc

Frasers Group Plc intends to provide a parental guarantee for the following United Kingdom incorporated subsidiaries

thus entitling them to exemption from statutory audit under section 479A of the Companies Act 2006.

COMPANY NAME COMPANY NUMBER COMPANY NAME COMPANY NUMBER

Alpha Developments Stockport Limited

12662564

SDI (Manchester Cheetham Hill) Limited

10100969

Brands Inc Limited

03585719

SDI (Manchester Denton) Limited

09127295

Hot Tuna IP Limited

06836792

SDI (Market Road) Limited

10799247

SD Equestrian Limited

08692780

SDI (Middlesbrough) Limited

10081909

SD Outdoor Limited

08560260

SDI (Nassau Street) Limited

11227964

SDI (Aberdeen) Limited

08512592

SDI (Neath) Limited

07853548

SDI (Aberdeen 2) Limited

12579371

SDI (Newark) Limited

07853470

SDI (Aberwystwyth) Limited

02789996

SDI (Newcastle) Limited

09127286

SDI (Aintree) Limited

03352462

SDI (Newport) Limited

08679118

SDI (Ashford) Limited

07848460

SDI (Newport IOW) Limited

12578944

SDI (Ashington) Limited

07849231

SDI (Newquay) Limited

10089800

SDI (Ayr) Limited

05528267

SDI (Newton Abbot) Limited

06836666

SDI (Bangor) Limited

05529705

SDI (Newtownabbey) Limited

09127266

SDI (Barrow In Furness) Limited

07851574

SDI (Northampton) Limited

07852272

SDI (Belfast) Limited

09872471

SDI (Northwich) Limited

05656295

SDI (Berwick) Limited

02739957

SDI (Nottingham) Limited

10100609

SDI (Betws-Y-Coed) Limited

06836673

SDI (Nuneaton) Limited

07852249

SDI (Birkenhead) Limited

07849198

SDI (Oswestry) Limited

07852363

SDI (Bishop Auckland) Limited

03004246

SDI (Oxford Street) Limited

10046080

SDI (Boucher Road) Limited

13808700

SDI (Penzance) Limited

07852297

SDI (Bridgwater) Limited

07852061

SDI (Peterlee) Limited

07852401

SDI (Brighton) Limited

12579780

SDI (Plymouth Flannels) Limited

09127387

SDI (Brixton) Limited

09127300

SDI (Plymouth) Limited

09470468

SDI (Burton) Limited

08495632

SDI (Portsmouth) Limited

12579294

SDI (Cardiff Flannels) Limited

10177359

SDI (Preston) Limited

10915199

SDI (Cardiff QS) Limited

12578045

SDI (Propco 75) Limited

11577256

SDI (Cardiff QS 2) Limited

11227321

SDI (Propco 100) Limited

11732700

SDI (Carlisle) Limited

07851959

SDI (Propco 119) Limited

12332862

SDI (Chatham) Limited

06836679

SDI (Propco 139) Limited

13808689

FRASERS GROUP PLC ANNUAL REPORT 2022

196

COMPANY NAME COMPANY NUMBER COMPANY NAME COMPANY NUMBER

SDI (Cheshunt 2) Limited

11775717

SDI (Ramsgate) Limited

07852250

SDI (Cheshunt) Limited

11775599

SDI (Reading) Limited

10422164

SDI (Clacton) Limited

07852078

SDI (Redcar) Limited

02731452

SDI (Colchester) Limited

05632790

SDI (Rolle St) Limited

07852669

SDI (Corby) Limited

10885672

SDI (Romford) Limited

10071547

SDI (Cork) Limited

11775763

SDI (Salisbury) Limited

10107572

SDI (Coventry) Limited

09680128

SDI (Scarborough) Limited

06328463

SDI (Darlington) Limited

10915193

SDI (Scunthorpe) Limited

07852055

SDI (Derby) Limited

09310031

SDI (Scunthorpe Parishes Centre) Limited

11730442

SDI (Derry) Limited

NI653340

SDI (Southampton 2) Limited

09665889

SDI (Doncaster) Limited

09888670

SDI (Southampton) Limited

08512480

SDI (Dundee) Limited

09702004

SDI (Southport) Limited

09888806

SDI (Dunfermline) Limited

08483679

SDI (St Austell) Limited

07852284

SDI (East Ham) Limited

09810378

SDI (St Helens) Limited

07852281

SDI (East Kilbride) Limited

06656368

SDI (Stafford) Limited

08568681

SDI (Edinburgh) Limited

10100990

SDI (Stafford Riverside) Limited

08972499

SDI (Enfield) Limited

10086209

SDI (Staines) Limited

11646482

SDI (Fulham) Limited

07852037

SDI (Stockport) Limited

06372181

SDI (Gainsborough) Limited

06338907

SDI (Stoke Longton) Limited

07853877

SDI (Galashiels) Limited

07852091

SDI (Stoke Newington) Limited

07852207

SDI (Glasgow Argyle St) Limited

11227937

SDI (Strabane) Limited

09890243

SDI (Glasgow Fort) Limited

09861504

SDI (Streatham) Limited

10066335

SDI (Glasgow Frasers) Limited

11531596

SDI (Strood) Limited

07852251

SDI (Glasgow Ingram Street) Limited

09925519

SDI (Sunderland) Limited

08755347

SDI (Gloucester) Limited

07852067

SDI (Sutton) Limited

11228011

SDI (Great Yarmouth) Limited

11732687

SDI (Swindon) Limited

09888662

SDI (Hanley) Limited

11228017

SDI (Taunton) Limited

07852191

SDI (Hastings) Limited

08625893

SDI (Thanet) Limited

12579034

SDI (Hereford) Limited

09888642

SDI (The House Yarm) Limited

12332871

SDI (Hofco) Limited

08319960

SDI (Thurrock) Limited

10089743

SDI (Hoh Holdings) Limited

10161592

SDI (Trowbridge) Limited

12355661

SDI (Hounslow) Limited

10086218

SDI (Uxbridge 2) Limited

09127316

SDI (Hull) Limited

09638564

SDI (Uxbridge) Limited

10177276

SDI (Ipswich) Limited

09788411

SDI (Wakefield) Limited

08483711

SDI (Ipswich 2) Limited

12578948

SDI (Walsall) Limited

07852289

SDI (Isle Of Man) Limited

09901745

SDI (Watford) Limited

06328505

SDI (Jersey Holding) Limited

10177028

SDI (Widnes) Limited

08576472

SDI (K Lynn) Limited

10073076

SDI (Wigan) Limited

12579287

SDI (Keighley) Limited

06260239

SDI (Wishaw) Limited

06656365

SDI (Kendal) Limited

06338918

SDI (Wrexham) Limited

10915200

SDI (Kentish Town) Limited

09901702

SDI (Wythenshawe) Limited

09659156

SDI (Kidderminster) Limited

09203731

SDI (Yeovil) Limited

12577947

SDI (Kilmarnock) Limited

07853433

SDI (York) Limited

11331391

SDI (Kingston) Limited

10915209

SDI Corrib Shopping Centre Limited

ROI (715322)

SDI (Kirkcaldy) Limited

07852097

SDI Four Limited

09719779

SDI (Leeds) Limited

09293515

SDI Golf Limited

09083512

SDI (Leeds 2) Limited

13808640

SDI Properties (Wigan) Limited

06836522

SDI (Leicester) Limited

09127170

SDI Property Limited

02767493

SDI (Liverpool) Limited

09888734

SDI Sport London Limited

09848767

SDI (Lowestoft) Limited

07852265

SDI Sports (Stoke) Limited

10163722

SDI (Lsl Holdings) Limited

10161824

Stirlings (Argyle Street) Limited

SC088108

FRASERS GROUP PLC ANNUAL REPORT 2022

197

COMPANY BALANCE SHEET

at 24 April 2022

Note

As at

24 April 2022

As at

25 April 2021

(£’m) (£’m)

FIXED ASSETS

Property, Plant and Equipment 3 6.9 -

Investments 2 1,443.6 1,494.9

CURRENT ASSETS

Debtors 5 512.8 162.9

Cash at bank and in hand 1.8 16.1

514.6 179.0

Creditors: amounts falling due within one year 6 (945.7) (609.0)

NET CURRENT LIABILITIES

(431.1) (430.0)

Provisions 8 (3.0) -

Deferred Tax Liability 7 (6.1) -

NET ASSETS 1,010.3 1,064.9

CAPITAL AND RESERVES

Called up share capital 9 64.1 64.1

Share premium 874.3 874.3

Treasury share reserve (488.9) (295.7)

Permanent contribution to capital 0.1 0.1

Capital redemption reserve 8.0 8.0

Own share reserve (66.8) (66.7)

Share based payment reserve 5.8 0.8

Profit and Loss account 613.7 480.0

SHAREHOLDERS' FUNDS 1,010.3 1,064.9

Frasers Group Plc reported a profit after taxation for the 52 weeks ended 24 April 2022 of £141.7m

(FY21: a profit of £231.8m).

The accompanying accounting policies and notes form part of these Financial Statements.

The Financial Statements were approved by the Board on 20 September 2022 and were signed on its behalf by:

Chris Wootton

Chief Financial Officer

Company number: 06035106

FRASERS GROUP PLC ANNUAL REPORT 2022

198

COMPANY STATEMENT OF

CHANGES IN EQUITY

For the 52 weeks ended 24 April 2022

Called

up share

capital

premium

account

Treasury

reserve

Permanent

contribution

to capital

Capital

redemption

reserve

Own

reserve

Share based

payment

reserve

Profit

& loss

account Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

As at 26 April 2020

64.1 874.3 (295.7) 0.1 8.0 (67.0) - 170.9 754.7

Profit for the financial period

- - - - - - - 231.8 231.8

Fair value adjustment in respect of

long-term financial assets

- recognised

- - - - - - - 77.3 77.3

Share scheme

- - - - - 0.3 0.8 - 1.1

As at 25 April 2021

64.1 874.3 (295.7) 0.1 8.0 (66.7) 0.8 480.0 1,064.9

Profit for the financial period

- - - - - - - 141.7 141.7

Fair value adjustment in respect of

long-term financial assets

- recognised

- - - - - - - (8.0) (8.0)

Share scheme

- - - - - - 5.0 - 5.0

Share repurchase

- - (193.2) - - (0.1) - - (193.3)

As at 24 April 2022

64.1 874.3 (488.9) 0.1 8.0 (66.8) 5.8 613.7 1,010.3

The share premium account is used to record the excess proceeds over nominal value on the issue of shares.

The permanent contribution to capital relates to a cash payment of £50,000 to the Company on 8 February

2007 under a deed of capital contribution. The capital redemption reserve arose on the redemption of the

Company’s redeemable preference shares of 10p each at par on 2 March 2007. The own shares and treasury

reserves represent the cost of shares in Frasers Group Plc purchased in the market and held by Frasers Group

Plc Employee Benefit Trust to satisfy options under the Group’s Share Scheme. For further information see note

26 in the Group Notes to the financial statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

199

NOTES TO THE COMPANY

FINANCIAL STATEMENTS

For the 52 weeks ended 24 April 2022

1. ACCOUNTING POLICIES

Accounting Policies

Frasers Group Plc (the “Company”) (Company number:

06035106) is a 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.

These financial statements have been prepared in

compliance with FRS 102 “The Financial Reporting

Standard applicable in the UK and Republic of

Ireland” (“FRS 102”) and the requirements of the

Companies Act 2006.

The financial statements are prepared in sterling, which

is the functional currency of the Company. Monetary

amounts in these financial statements are rounded to

the nearest £0.1m.

These accounts have been prepared in accordance with

applicable United Kingdom accounting standards. A

summary of the material accounting policies adopted

are described below.

Basis Of Accounting

The accounts have been prepared under the historical

cost basis except for the modification to a fair value

basis for certain financial instruments as specified in the

accounting policies below.

These financial statements for the period ended 24 April

2022 are prepared in accordance with FRS 102, The

Financial Reporting Standard applicable in the UK and

Republic of Ireland.

As permitted by Section 408 of the Companies Act

2006, a profit and loss account of the Company is not

presented. The Company’s profit after taxation for the

52-week period ended 24 April 2022 was £141.7m

(FY21: £231.8m).

As permitted by FRS 102 the Company has taken

advantage of the disclosure exemptions available

under that standard in relation to financial instruments,

presentation of a cash flow statement, share-based

payments, the aggregate remuneration of key

management personnel and related party transactions

with other wholly-owned members of the Group. Where

required, equivalent disclosures are given in the Group

accounts of Frasers Group Plc.

Principal Activity

The principal activity of Frasers Group Plc is that of an

investment holding company.

Investments

Fixed asset investments in subsidiaries are accounted

for at cost less provision for impairment. In the Group

accounts associates are accounted for under the equity

method by which the Group’s investment is initially

recorded at cost and subsequently adjusted to reflect

the Group’s share of the net assets of the associate.

As this is not permitted under FRS 102 associates are

accounted for at cost less provision for impairment. An

assessment is made at each reporting date of whether

there are indications that the Company’s investment

in subsidiaries or associates may be impaired or that

an impairment loss previously recognised has fully or

partially reversed. If such indications exist, the Company

estimates the recoverable amount of the asset. Shortfalls

between the carrying value of the investment and their

recoverable amounts, being the higher of fair value

less costs to sell and value-in-use, are recognised as

impairment losses. Impairment losses are recognised in

profit or loss.

The Company has followed the requirements of IFRS 9

for listed investments, as permitted by FRS 102 Section

12. The Company has made the irrevocable election

available under IFRS 9 to account for the investments

at fair value through the other comprehensive income

(FVOCI).

Fair value movements through other

comprehensive income

Elections are made on an instrument-by-instrument

basis to account for movements in selected instruments

through other comprehensive income. The Company

has elected to account for movements in its listed

investments through other comprehensive income.

These investments are not subject to impairment and

gains and losses are not recycled to the profit and loss

account on the disposal of listed investments. Dividend

income is recognised in the profit and loss account.

This treatment does not apply to investments in

the Company’s subsidiaries and associates where

movements are recognised in the profit and loss account

and investments are subject to impairment.

FRASERS GROUP PLC ANNUAL REPORT 2022

200

Associates

An entity is treated as an associated undertaking where

the Company exercises significant influence in that it has

the power to participate in the operating and financial

policy decisions.

Financial Assets

Financial assets, other than investments and derivatives,

are initially measured at transaction price (including

transaction costs) and subsequently held at cost, less

any impairment. Provision for impairment is established

when there is objective evidence that the Company will

not be able to collect amounts due according to the

original terms of the receivable. The Company applies

a consistent accounting policy as the Group in terms of

impairment of financial assets and the recognition of

expected credit losses.

Financial Liabilities

Financial liabilities are classified according to the

substance of the financial instrument’s contractual

obligations, rather than the financial instrument’s

legal form. Financial liabilities, excluding derivatives,

are initially measured at transaction price (after

deducting transaction costs) and subsequently held

at amortised cost.

Employee Benefit Trust

An Employee Benefit Trust has been established

for the purposes of satisfying certain share based

awards. The Group has ‘de facto’ control over the

special purpose entity.

The cost of shares acquired by the Sports Direct

Employee Benefit Trust is recognised within ‘Own share

reserve’ in equity.

Deferred Taxation

Deferred tax is provided for on a full provision basis on

all timing differences, which have arisen but not reversed

at the balance sheet date. A deferred tax asset is not

recognised to the extent that the transfer of economic

benefit in the future is more unlikely than not.

Deferred tax is calculated on a non-discounted basis at

the tax rates that are expected to apply in the periods in

which timing differences reverse, based on tax rates and

laws enacted or substantively enacted at the balance

sheet date.

Foreign Currencies

Transactions in foreign currencies are initially recorded

in the Company’s functional currency by applying the

spot exchange rate ruling at the date of the transaction.

Monetary assets and liabilities denominated in foreign

currencies are retranslated at the rate of exchange ruling

at the balance sheet date. All differences are taken to

the profit and loss account. Non-monetary items that

are measured in terms of historical cost in a foreign

currency are not retranslated.

Dividends

Dividends on the Company’s ordinary shares are

recognised as a liability in the Company’s Financial

Statements, and as a deduction from equity, in the

period in which the dividends are declared. Where such

final dividends are proposed subject to the approval of

the Company’s shareholders, the final dividends are only

declared once shareholder approval has been obtained.

Equity Instruments

An equity instrument is any contract that evidences

a residual interest in the assets of the Company after

deducting all of its liabilities. Equity instruments issued

by the Company, with the exception of those accounted

for via merger relief available under Section 612 of the

Companies Act 2006, are recorded at the proceeds

received, net of any direct issue costs.

Income From Group Undertakings

Income from Group undertakings is recognised when

qualifying consideration is received from the Group

undertaking.

Related Party Transactions

The Company has taken advantage of the exemption

contained in FRS 102 and has therefore not disclosed

transactions or balances with wholly-owned

subsidiaries which form part of the Group. See note

35 of the Group Financial Statements for further

details of related party transactions.

Share-Based Payments

The Company issues from time to time equity-settled

share-based payments to certain Directors and

employees of the Company and its subsidiaries.

These are measured at fair value at the date of grant,

which is expensed to profit and loss on a straight-line

basis over the vesting period, with the corresponding

credit going to equity.

FRASERS GROUP PLC ANNUAL REPORT 2022

201

Non-market vesting conditions are not taken into

account in determining grant date fair value. Instead,

they are taken into account by adjusting the number

of equity instruments to vest. At the end of each

reporting period the Company revises its estimates of

the number of options that are expected to vest based

on the non-market vesting and service conditions. Any

revisions, if any, are recognised in profit and loss with an

adjustment to equity.

Fair value is calculated using an adjusted form of the

Black-Scholes model which includes a Monte Carlo

simulation model that takes into account the exercise

price, the term of the option, the impact of dilution

(where material), the share price at grant date and

the expected price volatility of the underlying share,

the expected dividend yield, and the risk-free interest

rate for the term of the scheme. The expected staff

numbers used in the model has been adjusted, based

on management’s best estimate, for the effects

of non-transferability, exercise restrictions, and

behavioural considerations.

For cash-settled share-based payment transactions,

the Company measures the services received and the

liability incurred at the fair value of the liability. Until

the liability is settled, the Company remeasures the fair

value of the liability at the end of each reporting period

and at the date of settlement, with any changes in fair

value recognised in the Income Statement for the period.

The credit for the share-based payment charge

does not equal the charge per the profit and loss

as it excludes amounts recognised in the balance

sheet in relation to the expected national insurance

contributions for the shares.

Critical Accounting Estimates

and Judgements

In the application of the Company’s accounting

policies, the Directors are required to make judgements,

estimates and assumptions about the carrying amount

of assets and liabilities that are not readily apparent

from other sources. The estimates and associated

assumptions are based on historical experience and

other factors that are considered to be relevant. Actual

results may differ from these estimates.

The estimates and underlying assumptions are reviewed

on an ongoing basis. Revisions to accounting estimates

are recognised in the period in which the estimate is

revised, if the revision affects only that period, or in the

period of the revision and future periods.

The estimates and assumptions which have a significant

risk of causing a material adjustment to the carrying

amount of assets and liabilities are outlined below.

Control and Significant Influence Over

Certain Entities

The Company holds greater than 20% of the voting

rights of Studio Retail Group plc and the Mulberry Group

plc. The Company exercises the same judgements as per

note 2 of the Group financial statements on assessing

whether it has control and significant influence over

associates and joint ventures.

Impairment of Investments and Amounts

Owed by Group Undertakings

At each period end management assess the future

performance of entities with which the Company

holds an investment in, or a debtor from, to ascertain

whether there is objective evidence of impairment

of these balances. Judgement is involved in the

assessment of future performance and this involves an

element of estimation uncertainty. As at the period

end the Directors have reviewed the carrying value of

its investments and have made no impairments (FY21:

£1.1m impairment charge) as disclosed in note 2 of the

Company financial statements. As at the period end the

Directors have reviewed the carrying value of amounts

owed by Group undertakings and have made an

impairment charge of £6.4m (FY21: £nil).

FRASERS GROUP PLC ANNUAL REPORT 2022

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2. INVESTMENTS

Investments

in subsidiaries

Long-term

financial

assets

Total

(£m) (£m) (£m)

As at 26 April 2020

1,155.5 80.3 1,235.8

Additions

78.9 113.3 192.2

Impairment charge

(1.1) - (1.1)

Disposals

- (5.6) (5.6)

Amounts recognised through other comprehensive income

- 77.3 77.3

Exchange differences

- (3.7) (3.7)

As at 25 April 2021

1,233.3 261.6 1,494.9

Additions

5.0 198.0 203.0

Disposals

- (238.4) (238.4)

Amounts recognised through other comprehensive income

- (8.0) (8.0)

Exchange differences

- (7.9) (7.9)

As at 24 April 2022

1,238.3 205.3 1,443.6

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 best estimate.

Long-term financial assets include various holdings including a 36.9% stake in Mulberry Group plc, for further details

refer to Note 21 of the Group Financial Statements. The Company continues to hold a 28.9% interest in Studio Retail

Group (in administration) at the period end. However, given the administration and the sale of its main trading

subsidiary Studio Retail Limited, the interest has been fair valued to £nil with a £69.2m loss recognised through other

comprehensive income.

For further disclosures in relation to investments in associates and long-term financial assets see note 20, 21 and 35 of

the Group Financial Statements.

The Directors assess the value of the investments in subsidiaries at each period end for indicators of impairment. In

the prior period an impairment loss of £1.1m was recognised within the income statement for loss making companies

where the recoverable amount was less than the carrying value. The additions in the period relate to the Fearless 1000

share scheme, see note 25 of the Group Financial Statements.

The Company is the principal holding company of the Group. The principal subsidiary undertakings of the

Company are set out in note 39 of the Group Financial Statements.

The Group’s policies for financial risk management are set out in note 3 and note 30 of the Group Financial Statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

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3. PROPERTY, PLANT AND EQUIPMENT

Freehold Land

and Buildings

(£m)

Cost

At 25 April 2021

Additions

7.0

At 24 April 2022

7.0

Accumulated Depreciation and Impairment

At 25 April 2021

Charge for the period

(0.1)

At 24 April 2022

(0.1)

Net Book Value

At 25 April 2021

At 24 April 2022

6.9

4. FINANCIAL INSTRUMENTS

Financial Assets and Liabilities by Category

The fair value hierarchy of financial assets and liabilities, which are principally denominated in Sterling or US Dollars,

were as follows:

25 April 2022 25 April 2021

(£m) (£m)

FINANCIAL ASSETS

Amortised cost:

Trade and other receivables*

510.2 138.1

FVOCI:

Long Term Financial Assets (Equity Instruments)

205.2 261.6

Derivative financial assets (FV):

Derivative financial assets – contracts for difference

- 20.1

715.4 419.8

FINANCIAL LIABILITIES

Amortised cost:

Trade and other payables

869.8 607.3

Derivative financial Liabilities (FV):

Derivative financial Liabilities – contracts for difference and equity options

75.9 1.7

945.7 609.0

* Prepayments of £1.6m (FY21: £3.7m) and corporation tax assets of £1.0m (FY21: £1.0m) are not included as a financial asset.

FRASERS GROUP PLC ANNUAL REPORT 2022

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5. DEBTORS

24 April 2022

25 April 2021

(£m) (£m)

Amounts owed by Group undertakings

257.6 6.8

Derivative financial assets

- 20.1

Other debtors

252.6 131.3

Corporation tax

1.0 1.0

Prepayments

1.6 3.7

512.8 162.9

Other debtors includes £243.9m (FY21: £131.0m) of deposits in respect of derivative financial instruments which

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, interest rates and volatility) and

further purchases / sales of underlying investments held.

Amounts owed by Group undertakings are interest free and unsecured.

Further information on derivative financial assets can be found in the Group consolidated accounts in the financial

instruments note 30 and the financial risk management disclosure note 3.

6. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

24 April 2022

25 April 2021

(£m) (£m)

Trade creditors

1.9 1.3

Amounts owed to Group undertakings

864.9 602.5

Derivative financial liabilities

75.9 1.7

Other creditors

3.0 3.5

945.7 609.0

The amounted owed to Group undertakings mainly relates to an unsecured interest free loan with Sportsdirect.com

Retail Limited which is repayable on demand.

Further information on derivative financial liabilities can be found in the Group consolidated accounts in the financial

instruments note 30 and the financial risk management disclosure note 3.

The prior period Other creditors balance mostly related to the accrual for costs payable to MM Prop

Consultancy Limited, see note 35 of the Group financial statements.

7. DEFERRED TAX

Other temporary

differences

(£m)

At 26 April 2020

3.7

Charged to the profit and loss account

(3.7)

At 25 April 2021

Charged to the profit and loss account

(6.1)

At 24 April 2022

(6.1)

The tax rate used to measure the deferred tax assets and liabilities was 25% (FY21: 19%) on the basis that these were

the tax rates that were substantively enacted at the balance sheet date for the periods when the assets and liabilities

are expected to reverse.

FRASERS GROUP PLC ANNUAL REPORT 2022

205

8. PROVISIONS

Legal and

regulatory Total

(£m) (£m)

At 25 April 2021

- -

Amounts provided

3.0 3.0

At 24 April 2022

3.0 3.0

Frasers Group Plc has provided a guarantee in relation to payments from Studio Retail Group plc (in

administration) to the three other sections of the Findel Group Pension Fund up to a maximum of £0.9m. See

note 38 of the Group accounts.

9. CALLED UP SHARE CAPITAL

24 April 2022

25 April 2021

(£m) (£m)

Authorised

999,500,010 ordinary shares of 10p each

100.0 100.0

499,990 redeemable preference shares of 10p each

- -

Called up and fully paid

640,602,369 (FY21: 640,602,369) ordinary share of 10p each

64.1 64.1

Share capital

64.1 64.1

The Company holds 151,240,174 ordinary shares in treasury as at the period end date (FY21: 121,260,175).

10. POST BALANCE SHEET EVENTS

On 25 April 2022 and 20 June 2022 the Group

commenced share buyback programmes with the

aggregate purchase price of all shares acquired

under these programmes of no greater than £105.0m

and the maximum number of shares that may be

purchased under the programmes of 15m ordinary

shares with a nominal value of 10p each. The purpose

of the programmes was to reduce the share capital of

the Company. 11,884,438 ordinary shares of 10p each

for consideration of £79.9m were acquired through

these programmes.

On 1 May 2022 Michael Murray was appointed as

Chief Executive Officer of Frasers Group. Mike Ashley

and Michael Murray worked together for a number

of months to ensure a smooth transition into the role.

Michael will accelerate the Group’s strategy to achieve

its vision: “to serve our customers with the World’s best

sports, premium and luxury brands.”

On 16 May 2022 the Group acquired the entire share

capital of leading Danish sport retailer SportMaster. Due

to the proximity of the acquisition date to the date these

financial statements are authorised for issue, the initial

accounting for the business combination is incomplete

and so the disclosures required by IFRS 3 Business

Combinations cannot be made at this stage.

On 25 May 2022 the Group disposed of its US retail

businesses trading as Bobs Stores (“Bobs”) and Eastern

Mountain Sports (“EMS”) for a cash consideration of

$70m to GoDigital Media Group (“GDMG”). Further

details are included within note 16.

On 1 June 2022 the Group acquired certain intellectual

property of the online women’s fashion retailer,

Missguided Limited (in administration), Mennace

Limited (in administration) and Missguided (IP) Limited

for cash consideration of £20.0 million. Due to the

proximity of the acquisition date to the date these

financial statements are authorised for issue, the initial

accounting for the business combination is incomplete

and so the disclosures required by IFRS 3 Business

Combinations cannot be made at this stage.

FRASERS GROUP PLC ANNUAL REPORT 2022

206

The Group announced on 22 June 2022 that it has

increased its investment in Hugo Boss AG, and now has

the following interests in the common stock:

• 3,425,000 shares of common stock, representing

4.9% of Hugo Boss’s total share capital

• 18,289,000 shares of common stock via the sale of

put options, representing 26.0% of Hugo Boss’s total

share capital

After taking into account the premium it will receive

under the put options, Frasers Group’s maximum

aggregate exposure in connection with its acquired

interests in Hugo Boss, with the common stock holding

valued at the closing share price on 21 June 2022, is

approximately €900m (c. £770m).

On 28 July 2022 the Group acquired the online fashion

retailer I Saw It First for cash consideration of £1. Due to

the proximity of the acquisition date to the date these

financial statements are authorised for issue, the initial

accounting for the business combination is incomplete

and so the disclosures required by IFRS 3 Business

Combinations cannot be made at this stage.

On 11 August 2022 the Group completed the disposal

of a number of freehold and long leasehold retail

parks held by its wholly owned subsidiaries, to RI

UK 1 Limited for a headline price of £205m. Frasers

Group fascias will operate from leases within these

properties where appropriate. Frasers Group in the

ordinary course of business purchases and sells

properties from time to time and the Group intends to

use the proceeds of sale towards the working capital

of the Group and its operations.

On 17 August 2022 the Group made a cash offer to

acquire the entire issued and to be issued ordinary share

capital of MySale Group plc (‘MySale’) not already held

by Frasers Group at a price of 2 pence per MySale Share.

The offer values the entire issued and to be issued share

capital of MySale not currently held by Frasers Group

at approximately £13.6 million (not taking into account

the exercise of any outstanding options which may have

vested under the MySale Share Plans or any conversion

event pursuant to the Convertible Loan Notes). On 29

June 2022, Frasers Group acquired 270,666,650 MySale

Shares and, together with the contracts for difference

already held by it, Frasers Group increased its stake

in MySale to 28.7% and became MySale’s largest

shareholder. Since the disclosure of Frasers Group’s

acquisition of this further stake, the market price of

MySale shares has increased.

On 20 September 2022 the Group announced that

Mike Ashley would not be standing for re-election as a

Director at this year’s Annual General Meeting (“AGM”)

and that he will therefore step down from the Board

upon the conclusion of the AGM.

11. PAYROLL COSTS

Frasers Group Plc had no direct employees during the

periods ended 24 April 2022 and 25 April 2021, and the

Directors are remunerated through Sportsdirect.com

Retail Limited. Details of the Directors’ remuneration can

be found in the Directors’ Remuneration Report.

12. RELATED PARTY

TRANSACTIONS

Related party transactions with the Company are

disclosed within note 35 in the Group Financial Statements.

FRASERS GROUP PLC ANNUAL REPORT 2022

207

GLOSSARY

CONSOLIDATED FIVE YEAR RECORD AND ALTERNATIVE

PERFORMANCE MEASURES

52 weeks ended

24 April 2022

52 weeks ended

25 April 2021

52 weeks ended

26 April 2020

52 weeks ended

28 April 2019

52 weeks ended

29 April 2018

(£m) (£m) (£m) (£m) (£m)

REPORTED PBT

335.6 8.5 143.5 179.2 61.1

Exceptional items

1.3 1.6 13.1 41.0 4.8

Fair value gain on step acquisition

- - (20.4)

Fair value adjustments to derivatives included

within Finance (income) / costs

(7.6) 4.6 (21.3) (39.7) 17.7

Fair value (gains) / losses and profit on disposal

of equity derivatives

(9.9) (82.2) 35.1 (3.3) 103.6

Realised foreign exchange (gain) / loss

5.8 26.3 (34.9) (22.1) (24.1)

Share scheme

14.6 1.3 - - (6.0)

ADJUSTED PBT

339.8 (39.9) 115.1 155.1 157.1

Notes to the consolidated income statement five year record:

1. All information is presented under IFRS.

2. The five year record has been prepared on the same basis as the Financial Statements for the 52 weeks ended 24

April 2022, as set out in note 1, basis of preparation, of the Consolidated Financial Statements.

Reconciliation of excluding acquisitions and currency neutral performance measures:

Retail

Premium

Lifestyle

European

Retail

Rest Of

World Retail

Wholesale &

Licensing

Group

Total

(£’m) (£’m) (£’m) (£’m) (£’m) (£’m)

Revenue

FY22 Reported

2,640.1 1,056.6 790.2 150.3 168.1 4,805.3

Adjustments for acquisitions and currency neutral

(90.1) (3.9) - - - (94.0)

FY22 Excluding acquisitions and currency neutral

2,550.0 1,052.7 790.2 150.3 168.1 4,711.3

FY21 Reported

1,968.5 735.6 615.2 152.7 153.3 3,625.3

Adjustments for acquisitions and currency neutral

(8.2) (0.8) (23.0) (0.8) (1.7) (34.5)

FY21 Excluding acquisitions and currency neutral

1,960.3 734.8 592.2 151.9 151.6 3,590.8

% Variance

30.1% 43.3% 33.4% (1.1%) 10.9% 31.2%

Adjusted PBT

FY22 Reported

196.9 10.5 88.6 32.7 11.1 339.8

Adjustments for acquisitions and currency neutral

32.5 (0.4) - - - 32.1

FY22 Excluding acquisitions and currency neutral

229.4 10.1 88.6 32.7 11.1 371.9

FY21 Reported

(12.8) (7.8) (51.3) 12.2 19.8 (39.9)

Adjustments for acquisitions and currency neutral

15.8 0.2 2.0 (0.1) (0.1) 17.8

FY21 Excluding acquisitions and currency neutral

3.0 (7.6) (49.3) 12.1 19.7 (22.1)

% Variance

7,546.7% (232.9%) (279.7%) 170.2% (43.7%) (1,782.8%)

(1) The FY21 numbers have been re-categorised due to changes in the reporting segments, with freehold property owning companies where trading is purely from

Premium Lifestyle fascias being moved from UK Sports Retail to Premium Lifestyle.

FRASERS GROUP PLC ANNUAL REPORT 2022

208

Key Performance Indicators

Performance Measure

Closest equivalent statutory

measure

Reconciling items to statutory

measure Definition and purpose

Group revenue

- - The Board considers that this

measure is a key indicator of the

Group’s growth.

Reported PBT

- - 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

foreign exchange.

Adjusted PBT

Profit before taxation Adjusting items (see Glossary

reconciliation above). The adjusting

items are those deemed by the

Board to be volatile and therefore

difficult to forecast.

Adjusted PBT 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

- - Cash inflow from operating activities is

considered an important indicator for

the business of the cash available for

investment in the Elevation strategy.

Net assets

- - The Board considers that this

measurement is a key indicator of

the Group's 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.

Workforce turnover

- - The Board considers that this

measure is a key indicator of the

contentment of our people.

Packaging recycling

- - The Board considers that this

measurement is a key indicator of

our impact and commitment to the

best environmental practices.

FRASERS GROUP PLC ANNUAL REPORT 2022

209

COMPANY DIRECTORY

REGISTRAR AND

TRANSFER OFFICE

Computershare Investor Services plc

The Pavilions

Bridgwater Road

Bristol

BS99 6ZZ

Telephone: 0370 707 4030

COMPANY SECRETARY AND

REGISTERED OFFICE

Frasers Group Plc

Unit A, Brook Park East

Shirebrook

NG20 8RY

Telephone: 0344 245 9200

Frasers Group Plc is registered in England and Wales

(No. 06035106)

SOLCITORS

Reynolds Porter Chamberlain LLP

Tower Bridge House

St Katharine’s Way

London

E1W 1AA

Dentons UK and Middle East LLP

One Fleet Place

London

EC4M 7WS

BROKERS

Liberum Capital Limited

Ropemaker Place, Level 12

25 Ropemaker Street

London

EC2Y 9LY

Numis Securities Limited

45 Gresham Street

London

EC2V 7BF

PRINCIPAL BANKERS

Barclays Bank plc

5 The North Colonnade Canary Wharf

London

E14 4BB

HSBC Bank plc

8 Canada Square London

E14 5HQ

AUDITORS

RSM UK Audit LLP

25 Farringdon Street

London

EC4A 4AB

FRASERS GROUP PLC ANNUAL REPORT 2022

210

SHAREHOLDER INFORMATION

ANNUAL GENERAL MEETING

The date and time of the Annual General Meeting

is to be announced in a separate notice. Each

shareholder is entitled to attend and vote at the

meeting, the arrangements for which are described in

a separate notice.

RESULTS

For the year to 30 April 2023:

• Half year results announced: tbc December 2022

• Preliminary announcement of full year results: tbc

• Annual Report circulated: tbc

SHAREHOLDER HELPLINE

The Frasers Group shareholder register is maintained

by Computershare who are responsible for making

dividend payments and updating the register, including

details of changes to shareholders’ addresses. If you

have a query about your shareholding in Sports Direct,

you should contact Computershare’s Frasers Group

Shareholder Helpline on: 0370 707 4030. Calls are

charged at standard geographic rates, although network

charges may vary.

Address:

The Pavilions, Bridgwater Road, Bristol, BS99 6ZZ

Website:

www.computershare.com

WEBSITE

The Group website at www.frasers.group provides news

and details of the Company’s activities plus information

for shareholders and contains real time share price data

as well as the latest results and announcements.

UNSOLICITED MAIL

The Company is obliged by law to make its share

shareholders may receive unsolicited mail, including

from unauthorised investment firms.

For more information on unauthorised investment firms

targeting UK investors, visit the website of the Financial

Conduct Authority at www.fca.org.uk

If you wish to limit the amount of unsolicited mail you

receive contact:

Mailing Preference Service

DMA House

70 Margaret Street

London

W1W 8SS

Telephone:

020 7291 3310

Email:

[email protected]g.uk

or register online at www.mpsonline.org.uk

Frasers Group Plc

Unit A, Brook Park East, Shirebrook, NG20 8RY

0344 245 9200

www.frasers.group

FRASERS GROUP PLC ANNUAL REPORT 2022

211

ANNUAL

REPORT &

ACCOUNTS

2022.

FRASERS GROUP PLC