1.   CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

 

The critical accounting estimates and judgements made by the Group in preparing this unaudited trading statement 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:

Key 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 and have concluded that this does 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.

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 taken to the 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, the Hedging reserve of £55.4m (FY21: £11.5m)  would be shown in Finance Income.

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.

 

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 15.1% (FY21: 16.6%). A 1% change in the total provision would impact Adjusted PBT by approx. £14.8m (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 Adjusted PBT.

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).

•       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).

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.

 

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.

 

IFRS 16

The key areas of judgement in relation to property leases recognised under IFRS 16 are below:

 

•       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), being £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 impairments were 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.

The key assumptions, which are equally applicable to each CGU, in the cash flow projections used to support the carrying amount of the right of use asset are consistent with the cashflow projections for the Freehold land and Buildings impairment assessment.

A sensitivity analysis has been performed in respect of sales, margin 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)

(1)        Stores which have been open for less than one year are not reviewed for impairment. 

 

Freehold Land and Buildings and Long-term leasehold

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 split £106.5m 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 against long-term leasehold (£2.0m UK Sports Retail segment), £1.6m plant & equipment (£1.2m UK Sports Retail segment, £0.2m Premium Lifestyle segment, £0.2m European Retail segment), and £1.0m investment property (all UK Sports Retail segment).

 

Value In Use (VIU)

The value in use is calculated based on five year cash flow projections. These are formulated by using the Group's forecast cash flows 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.

 

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

 

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%
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%
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, with £47.3m of this being based on their fair value less costs of disposal and £58.6m being based on their value in use.

 

2.   SEGMENTAL ANALYSIS

 

The below segmental information excludes SRL. Management has determined to present its segmental disclosures consistently with the presentation in the 2021 Annual Report.

 

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, and retail store operations in Northern Ireland.

ii)     Premium Lifestyle - includes the results of the premium retail businesses FLANNELS, Cruise, van mildert, Jack Wills, House of Fraser and Sofa.com along with the 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, and Slazenger.

 

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.

 

Segmental information for the 52 weeks ended 24 April 2022 (unaudited):

 

	UK Sports Retail		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	2,581.7		1,056.6		3,638.3	790.2		150.3		4,578.8	168.1		-		4,746.9
Sales to other segments	-		-		-	-		-		-	80.1		(80.1)		-
Revenue	2,581.7		1,056.6		3,638.3	790.2		150.3		4,578.8	248.2		(80.1)		4,746.9
Gross profit	1,122.5		474.8		1,597.3	337.3		76.7		2,011.3	63.1		-		2,074.4
Operating profit before foreign exchange, exceptional items and property and other related impairments	293.5		124.1		417.6	109.8		34.4		561.8	6.9		-		568.7
Exceptional items	(1.3)		-		(1.3)	-		-		(1.3)	-		-		(1.3)
Property related impairments	(103.4)		(103.5)		(206.9)	(17.9)		(2.2)		(227.0)	-		-		(227.0)
Realised foreign exchange loss	(1.0)		(0.1)		(1.1)	(2.9)		(0.8)		(4.8)	(0.9)		-		(5.7)
Operating profit	187.8		20.5		208.3	89.0		31.4		328.7	6.0		-		334.7
Investment income	69.2	-		69.2			-		-	69.2		-		-	69.2
Investment costs	(19.7)	-		(19.7)			-		-	(19.7)		-		-	(19.7)
Finance income (1)	36.8	(8.5)		28.3			1.0		1.0	30.3		-		-	30.3
Finance costs	(42.0)	(1.5)		(43.5)			(4.4)		(0.5)	(48.4)		-		-	(48.4)
Profit before taxation	232.1	10.5		242.6			85.6		31.9	360.1		6.0		-	366.1
Taxation															(68.8)
Profit for the period															297.3
Total assets	3,768.6	1,003.5		4,772.1			497.3		86.3	5,355.7		330.9		(1,770.4)	3,916.2
Total liabilities	(2,451.6)	(1,098.9)		(3,550.5)			(681.4)		7.6	(4,224.3)		(93.4)		1,770.6	(2,547.1)
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	1.3	-		1.3			-		-	1.3		-		-	1.3

 

(1)       Includes inter-company related finance income in UK Sports Retail and the equivalent finance cost in Premium Lifestyle that eliminates on consolidation.

 

Other segment items included in the income statement for the 52 weeks ended 24 April 2022 (unaudited):

(2)                    

	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	121.9	22.9	144.8	20.2	2.4	167.4	1.3	168.7
Property, plant & equipment impairment	51.7	94.0	145.7	2.3	1.2	149.2	-	149.2
IFRS 16 ROU depreciation	47.7	6.4	54.1	19.9	3.1	77.1	0.4	77.5
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	-	-	-	-	-	-	6.5	6.5
Intangible impairment	1.3	-	1.3	-	-	1.3	4.4	5.7

 

 

Segmental information for the 52 weeks ended 25 April 2021⁽¹⁾ (audited):

 

	UK Sports Retail		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 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)
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 assets acquired	3.7	2.3			6.0		-		-		6.0		1.0		-	7.0

 

(3)       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.

 

Other segment items included in the income statement for the 52 weeks ended 25 April 2021 (audited):

(4)                    

	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	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

 

 

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 performance:

 

Reconciliation of Profit Before Tax to Adjusted PBT for the 52 week period ended 24 April 2022 (unaudited):

 

	UK Sports Retail	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)
Profit Before Tax	232.1	10.4	242.5	85.7	31.9	360.1	6.0	366.1
Exceptional items	1.3	-	1.3	-	-	1.3	-	1.3
Fair value adjustment to derivative financial instruments	(7.7)	-	(7.7)	-	-	(7.7)	-	(7.7)
Fair value (gains)/losses and profit on disposal of equity derivatives	(35.3)	-	(35.3)	-	-	(35.3)	-	(35.3)
Realised FX loss	1.0	0.1	1.1	2.9	0.8	4.8	1.0	5.8
Share scheme	10.4	-	10.4	-	-	10.4	4.2	14.6
Adjusted PBT	201.8	10.5	212.3	88.6	32.7	333.6	11.2	344.8

 

 

Reconciliation of Reported PBT to Adjusted PBT for the 52 week period ended 25 April 2021⁽¹⁾ (audited):

 

	UK Sports Retail	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.

 

 

3. INVESTMENT INCOME

 

	(Unaudited) 52 weeks ended	(Audited) 52 weeks ended
	24 April 2022	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	31.8	62.5
Dividend income	1.0	0.5
	69.2	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.

 

4. INVESTMENT COSTS

 

 

	(Unaudited) 52 weeks ended	(Audited) 52 weeks ended
	24 April 2022	25 April 2021
	(£'m)	(£'m)
Fair value loss on equity derivatives	19.7	7.7
	19.7	7.7

 

The fair value loss on equity derivatives in the current period mainly relates to Hugo Boss contracts for difference.

 

5. FINANCE INCOME

 

	(Unaudited) 52 weeks ended	(Audited) 52 weeks ended
	24 April 2022	25 April 2021
	(£'m)	(£'m)
Bank interest receivable	4.5	3.5
Other finance income	1.8	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.

 

6. FINANCE COSTS

 

	(Unaudited) 52 weeks ended	(Audited) 52 weeks ended
	24 April 2022	25 April 2021
	(£'m)	(£'m)
Interest on bank loans and overdrafts	12.9	11.1
Other interest	6.9	8.6
Interest on retirement benefit obligations	0.1	0.1
IFRS 16 lease interest	12.2	11.8
Fair value adjustment to derivatives	16.3	4.6
	48.4	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.