TIDMKGF
RNS Number : 8335M
Kingfisher PLC
19 September 2023
Kingfisher plc
2023/24 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED INCOME STATEMENT
Half year ended 31 July 2023 Half year ended 31 July 2022
-------------------------------------------- --------------------------------------------
Before Adjusting items Before Adjusting items
GBP millions Notes adjusting items (note 5) Total adjusting items (note 5) Total
---------------- ------ ---------------- ---------------- -------- ---------------- ---------------- --------
Sales 4 6,880 - 6,880 6,809 - 6,809
Cost of sales (4,385) - (4,385) (4,313) - (4,313)
---------------- -------- ---------------- --------
Gross profit 2,495 - 2,495 2,496 - 2,496
Selling and
distribution
expenses (1,605) (21) (1,626) (1,549) 1 (1,548)
Administrative
expenses (511) - (511) (434) - (434)
Other income 12 2 14 11 1 12
Share of
post-tax
results of
joint ventures
and associates (5) - (5) 5 - 5
Operating
profit 4 386 (19) 367 529 2 531
Finance costs (64) - (64) (65) - (65)
Finance income 14 - 14 8 - 8
---------------- ------ ---------------- ---------------- -------- ---------------- ---------------- --------
Net finance
costs 6 (50) - (50) (57) - (57)
---------------- ------ ---------------- ---------------- -------- ---------------- ---------------- --------
Profit before
taxation 336 (19) 317 472 2 474
Income tax
expense 7 (87) 7 (80) (104) 3 (101)
---------------- ------ ---------------- ---------------- -------- ---------------- ---------------- --------
Profit for the
period 249 (12) 237 368 5 373
---------------- ------ ---------------- ---------------- -------- ---------------- ---------------- --------
Earnings per
share 8
Basic 12.4p 18.6p
Diluted 12.2p 18.3p
Adjusted basic 13.0p 18.3p
Adjusted
diluted 12.8p 18.0p
---------------- ------ ---------------- ---------------- -------- ---------------- ---------------- --------
The proposed interim ordinary dividend for the period ended 31
July 2023 is 3.80p per share (2022/23: 3.80p per share).
Kingfisher plc
2023/24 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED INCOME STATEMENT
Year ended 31 January 2023
---------------------------------------
Adjusting
Before adjusting items
GBP millions Notes items (note 5) Total
---------------------------------------------------- -------- ----------------- ---------- --------
Sales 4 13,059 - 13,059
Cost of sales (8,264) - (8,264)
Gross profit 4,795 - 4,795
Selling and distribution expenses (3,087) (136) (3,223)
Administrative expenses (868) (12) (880)
Other income 25 1 26
Share of post-tax results of joint ventures and associates 5 - 5
Operating profit 4 870 (147) 723
Finance costs (129) - (129)
Finance income 17 - 17
---------------------------------------------------- -------- ----------------- ---------- --------
Net finance costs 6 (112) - (112)
---------------------------------------------------- -------- ----------------- ---------- --------
Profit before taxation 758 (147) 611
Income tax expense 7 (169) 29 (140)
---------------------------------------------------- -------- ----------------- ---------- --------
Profit for the year 589 (118) 471
---------------------------------------------------- -------- ----------------- ---------- --------
Earnings per share 8
Basic 23.8p
Diluted 23.5p
Adjusted basic 29.7p
Adjusted diluted 29.4p
Kingfisher plc
2023/24 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Half year ended Half year ended Year ended
GBP millions Notes 31 July 2023 31 July 2022 31 January 2023
----------------------------------------------------- -------- ---------------- ---------------- -----------------
Profit for the period 237 373 471
----------------------------------------------------- -------- ---------------- ---------------- -----------------
Remeasurements of post-employment benefits 11 (9) (14) (278)
Inventory cash flow hedges - fair value
(losses)/gains (40) 113 58
Tax on items that will not be reclassified 14 (24) 85
----------------------------------------------------- -------- ---------------- ---------------- -----------------
Total items that will not be reclassified
subsequently to profit or loss (35) 75 (135)
----------------------------------------------------- -------- ---------------- ---------------- -----------------
Currency translation differences
Group (10) (22) 129
Joint ventures and associates (4) (1) 11
Transferred to income statement (2) - -
Inventory cash flow hedges - losses/(gains)
transferred to income statement 9 - (5)
Total items that may be reclassified subsequently to
profit or loss (7) (23) 135
-------- ---------------- ----------------
Other comprehensive (expense)/income for the period (42) 52 -
----------------------------------------------------- -------- ---------------- ---------------- -----------------
Total comprehensive income for the period 195 425 471
----------------------------------------------------- -------- ---------------- ---------------- -----------------
Kingfisher plc
2023/24 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Half year ended 31 July
2023
---------- ---------- -------- ----------- ----------------------------------
Share Other
capital Own Capital reserves
(note Share shares Retained redemption (note Total
GBP millions 13) premium held earnings reserve 14) equity
----------------------------- ---------- ---------- -------- ----------- ------------ ---------- --------
At 1 February 2023 305 2,228 (22) 3,796 71 285 6,663
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Profit for the period - - - 237 - - 237
Other comprehensive expense
for the period - - - (4) - (38) (42)
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Total comprehensive
income/(expense)
for the period - - - 233 - (38) 195
Inventory cash flow hedges
- losses transferred to
inventories - - - - - 12 12
Share-based compensation - - - 12 - - 12
New shares issued under share
schemes - - - 2 - - 2
Own shares issued under share
schemes - - 9 (9) - - -
Purchase of own shares for
cancellation (6) - - (103) 6 - (103)
Purchase of own shares for
ESOP trust - - (24) - - - (24)
Dividends - - - (165) - - (165)
Tax on equity items - - - - - (4) (4)
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
At 31 July 2023 299 2,228 (37) 3,766 77 255 6,588
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Half year ended 31 July 2022
---------- ---------------------------------------------------------------------
Share Other
capital Own Capital reserves
(note Share shares Retained redemption (note Total
GBP millions 13) premium held earnings reserve 14) equity
----------------------------- ---------- ---------- -------- ----------- ------------ ---------- --------
At 1 February 2022 325 2,228 (46) 4,025 50 196 6,778
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Profit for the period - - - 373 - - 373
Other comprehensive
(expense)/income
for the period - - - (10) - 62 52
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Total comprehensive income
for the period - - - 363 - 62 425
Inventory cash flow hedges
- gains transferred to
inventories - - - - - (61) (61)
Share-based compensation - - - 11 - - 11
New shares issued under share
schemes - - - 2 - - 2
Own shares issued under share
schemes - - 17 (17) - - -
Purchase of own shares for
cancellation (13) - - (225) 13 - (225)
Dividends - - - (172) - - (172)
Tax on equity items - - - (1) - 14 13
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
At 31 July 2022 312 2,228 (29) 3,986 63 211 6,771
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Year ended 31 January 2023
--------- -----------------------------------------------------------------------
Share Other
capital Own Capital reserves
(note Share shares Retained redemption (note Total
GBP millions 13) premium held earnings reserve 14) equity
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
At 1 February 2022 325 2,228 (46) 4,025 50 196 6,778
Profit for the year - - - 471 - - 471
Other comprehensive
(expense)/income
for the year - - - (181) - 181 -
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Total comprehensive
income/(expense)
for the year - - - 290 - 181 471
Inventory cash flow hedges
- gains transferred to
inventories - - - - - (117) (117)
Share-based compensation - - - 19 - - 19
New shares issued under share
schemes 1 - - 7 - - 8
Own shares issued under share
schemes - - 24 (24) - - -
Purchase of own shares for
cancellation (21) - - (275) 21 - (275)
Dividends - - - (246) - - (246)
Tax on equity items - - - - - 25 25
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
At 31 January 2023 305 2,228 (22) 3,796 71 285 6,663
------------------------------ --------- ---------- -------- ----------- ------------ ---------- ----------
Kingfisher plc
2023/24 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED BALANCE SHEET
GBP millions Notes At 31 July 2023 At 31 July 2022 At 31 January 2023
---------------------------------------------- ------ ---------------- ---------------- -------------------
Non-current assets
Goodwill 2,407 2,424 2,408
Other intangible assets 10 372 353 371
Property, plant and equipment 10 3,168 3,086 3,205
Investment property 10 28 33 30
Right-of-use assets 1,934 1,842 1,947
Investments in joint ventures and associates 12 20 30
Post-employment benefits 11 243 542 251
Deferred tax assets 19 9 16
Other tax authority asset 17 67 64 64
Derivative assets 12 - 2 -
Other receivables 16 17 19
---------------------------------------------- ------ ---------------- ---------------- -------------------
8,266 8,392 8,341
Current assets
Inventories 3,132 3,138 3,070
Trade and other receivables 393 364 347
Derivative assets 12 4 82 16
Current tax assets 44 37 40
Cash and cash equivalents 344 496 286
Assets held for sale 3 5 3
3,920 4,122 3,762
---------------------------------------------- ------ ---------------- ---------------- -------------------
Total assets 12,186 12,514 12,103
---------------------------------------------- ------ ---------------- ---------------- -------------------
Current liabilities
Trade and other payables (2,665) (2,891) (2,483)
Borrowings 12 (28) (17) (16)
Lease liabilities (350) (334) (343)
Derivative liabilities 12 (54) (13) (47)
Current tax liabilities (2) (19) -
Provisions (9) (16) (10)
(3,108) (3,290) (2,899)
Non-current liabilities
Other payables (4) (10) (4)
Borrowings 12 (101) (1) (102)
Lease liabilities (2,048) (1,984) (2,101)
Derivative liabilities 12 (3) - (5)
Deferred tax liabilities (207) (310) (205)
Provisions (11) (12) (10)
Post-employment benefits 11 (116) (136) (114)
(2,490) (2,453) (2,541)
---------------------------------------------- ------ ---------------- ---------------- -------------------
Total liabilities (5,598) (5,743) (5,440)
---------------------------------------------- ------ ---------------- ---------------- -------------------
Net assets 6,588 6,771 6,663
---------------------------------------------- ------ ---------------- ---------------- -------------------
Equity
Share capital 13 299 312 305
Share premium 2,228 2,228 2,228
Own shares held in ESOP trust (37) (29) (22)
Retained earnings 3,766 3,986 3,796
Capital redemption reserve 77 63 71
Other reserves 14 255 211 285
---------------------------------------------- ------ ---------------- ---------------- -------------------
Total equity 6,588 6,771 6,663
---------------------------------------------- ------ ---------------- ---------------- -------------------
The interim financial report was approved by the Board of
Directors on 18 September 2023 and signed on its behalf by:
Thierry Garnier, Chief Executive Bernard Bot , Chief Financial
Officer Officer
Kingfisher plc
2023/24 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED CASH FLOW STATEMENT
Half year ended Half year ended Year ended
GBP millions Notes 31 July 2023 31 July 2022 31 January 2023
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Operating activities
Cash generated by operations 15 796 584 984
Income tax paid (68) (75) (130)
French tax authority payment - (34) (34)
Net cash flows from operating activities 728 475 820
Investing activities
Purchase of property, plant and equipment and
intangible assets (164) (184) (449)
Disposal of property, plant and equipment, assets held
for sale and intangible assets - 1 2
Purchase of businesses (3) - -
Disposal of subsidiaries and associates 9 - 8
Interest received 7 1 5
Interest element of lease rental receipts - 1 1
Principal element of lease rental receipts 1 2 3
Advance payments on right-of-use assets (1) (2) (7)
Advance receipts on right-of-use assets - 2 2
Dividends received from joint ventures and associates - 1 3
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Net cash flows used in investing activities (151) (178) (432)
Financing activities
Interest paid (2) (3) (5)
Interest element of lease rental payments (62) (62) (124)
Principal element of lease rental payments (176) (164) (329)
Issue of fixed term debt - - 99
New shares issued under share schemes 2 2 8
Purchase of own shares for cancellation (99) (218) (337)
Purchase of own shares for ESOP trust (24) (9) (9)
Ordinary dividends paid to equity shareholders of the
Company 9 (165) (172) (246)
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Net cash flows used in financing activities (526) (626) (943)
Net increase/(decrease) in cash and cash equivalents
and bank overdrafts 51 (329) (555)
Cash and cash equivalents and bank overdrafts at
beginning of period 270 809 809
Exchange differences (4) (1) 16
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Cash and cash equivalents and bank overdrafts at end
of period 317 479 270
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Kingfisher plc
2023/24 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. General information
Kingfisher plc ('the Company'), its subsidiaries, joint ventures
and associates (together 'the Group') supply home improvement
products and services through a network of retail stores and other
channels, located mainly in the United Kingdom and continental
Europe.
The Company is incorporated in England and Wales, United
Kingdom, and is listed on the London Stock Exchange. The address of
its registered office is One Paddington Square, London, W2 1GG.
The interim financial report does not comprise statutory
accounts within the meaning of section 434 of the Companies Act
2006. Audited statutory accounts for the year ended 31 January 2023
were approved by the Board of Directors on 20 March 2023 and
delivered to the Registrar of Companies. The report of the auditors
on those accounts was unqualified, did not contain an emphasis of
matter paragraph and did not contain any statement under sections
498(2) or (3) of the Companies Act 2006. The interim financial
report has been reviewed, not audited, and was approved by the
Board of Directors on 18 September 2023.
2. Basis of preparation
The interim financial report for the six months ended 31 July
2023 ('the half year') has been prepared in accordance with the
Disclosure and Transparency Rules of the Financial Conduct
Authority and with IAS 34, 'Interim Financial Reporting', as
adopted by the United Kingdom. It should be read in conjunction
with the annual financial statements for the year ended 31 January
2023, which have been prepared in accordance with international
accounting standards in conformity with the requirements of the
Companies Act 2006 and International Financial Reporting Standards
(IFRS Standards) as issued by the IASB. The consolidated income
statement and related notes represent results for continuing
operations, there being no discontinued operations in the periods
presented. Where comparatives are given, '2022/23' refers to the
six months ended 31 July 2022.
Going concern
Based on the Group's liquidity position and cash flow
projections, including a forward-looking remote downside scenario,
the Directors have a reasonable expectation that the Company and
the Group have adequate resources to continue in operational
existence for the foreseeable future, a period not less than 12
months from the date of this report, and they continue to adopt the
going concern basis of accounting in preparing the condensed
consolidated financial statements for the period ended 31 July
2023.
Considering whether the Group's condensed consolidated financial
statements can be prepared on a going concern basis, the Directors
have reviewed the Group's business activities together with factors
likely to affect its performance, financial position and access to
liquidity (including consideration of financial covenants). As of
31 July 2023, the Group had access to over GBP800m in total
liquidity, including cash and cash equivalents of GBP317m (net of
bank overdrafts) and access to a GBP550m revolving credit facility
(RCF) , of which GBP504m is due to expire in May 2026 and GBP46m in
May 2025.
In forming their outlook on the future financial performance,
the Directors considered the risk of higher business volatility and
the potential negative impact of the general economic environment
on household and trade spend.
The Directors' review also included consideration of a remote
scenario that models the impact of a significant demand or supply
shock preventing the Group from realising a large part of its sales
over the period of a month followed by subdued demand for the
following 11 months. The total loss of sales in this scenario is
c.GBP1.4bn (10% over the impacted period). The scenario assumes the
impact of lost sales is partially offset by a limited set of
mitigating actions on variable and discretionary costs, capital
expenditure and the suspension of capital returns to shareholders.
Even under this remote scenario, which requires drawing on the RCF
for a few months, the Group retains sufficient liquidity and
remains in compliance with financial covenants on credit
facilities. Should a more extreme scenario occur than currently
forecast by the Directors under this remote scenario, the Group
would need to implement additional operational or financial
measures.
New and amended accounting standards
New standards, amendments and interpretations are in issue and
effective for the Group's financial year ended 31 January
2024, but they do not have a material impact on the interim
financial report.
Principal rates of exchange against Sterling
Half year ended 31 Half year ended 31 Year ended 31 January
July 2023 July 2022 2023
--------------------- --------------------- ------------------------
Average Period end Average Period end Average Year end
rate rate rate rate rate rate
--------------- -------- ----------- -------- ----------- ----------- -----------
Euro 1.15 1.17 1.18 1.19 1.17 1.13
US Dollar 1.24 1.29 1.27 1.22 1.23 1.23
Polish Zloty 5.25 5.14 5.53 5.64 5.48 5.34
Romanian Leu 5.66 5.77 5.85 5.87 5.76 5.58
Turkish Lira* 34.61 34.61 19.67 21.82 23.18 23.18
--------------- -------- ----------- -------- ----------- ----------- -----------
* The 31 July 2023 and 31 January 2023 Turkish Lira average
exchange rates represent the closing rates for the periods, due to
the application of hyperinflation accounting in Turkey.
Risks and uncertainties
The principal risks and uncertainties to which the Group is
exposed are set out on pages 51-58 of the Kingfisher plc Annual
Report and Accounts for the year ended 31 January 2023. These have
been reviewed as part of the Group's half year procedures and are
listed in the Financial Review.
Use of non-GAAP measures
In the reporting of financial information, the Group uses
certain measures that are not required under IFRS, the generally
accepted
accounting principles ('GAAP') under which the Group reports.
The Group believes that retail profit, adjusted pre-tax profit,
adjusted effective tax rate, and adjusted earnings per share
provide additional useful information on performance and trends to
shareholders. These and other non-GAAP measures (also known as
'Alternative Performance Measures'), such as net debt, are used by
the Group for internal performance analysis and incentive
compensation arrangements for employees. The terms 'retail profit',
'adjusting items', 'adjusted', 'adjusted effective tax rate', 'net
cashflow' and 'net debt' are not defined terms under IFRS and may
therefore not be comparable with similarly titled measures reported
by other companies. They are not intended to be a substitute for,
or superior to, GAAP measures.
Retail profit is defined as continuing operating profit before
central costs, the Group's share of interest and tax of joint
ventures and associates and adjusting items. Central costs
principally comprise the costs of the Group's head office before
adjusting items.
Adjusting items, which are presented separately within their
relevant income statement category, include items which by virtue
of their size and/or nature, do not reflect the Group's ongoing
trading performance. Adjusting items may include, but are not
limited to:
-- non-trading items included in operating profit such as
profits and losses on the disposal, closure, exit or impairment of
subsidiaries, joint ventures, associates and investments which do
not form part of the Group's ongoing trading activities;
-- the costs of significant restructuring and incremental acquisition integration costs;
-- profits and losses on the disposal/exit of properties,
impairments of goodwill and significant impairments (or impairment
reversals) of other non-current assets;
-- prior year tax items (including the impact of changes in tax
rates on deferred tax), significant one-off tax settlements and
provision charges/releases and the tax effects of other adjusting
items;
-- financing fair value remeasurements i.e. changes in the fair
value of financing derivatives, excluding interest accruals, offset
by fair value adjustments to the carrying amount of borrowings and
other hedged items under fair value (or non-designated) hedge
relationships. Financing derivatives are those that relate to
hedged items of a financing nature.
The term 'adjusted' refers to the relevant measure being
reported for continuing operations excluding adjusting items.
The adjusted effective tax rate is calculated as continuing
income tax expense excluding prior year tax items (including the
impact of changes in tax rates on deferred tax), significant
one-off tax settlements and provision charges/releases and the tax
effects of other adjusting items, divided by continuing profit
before taxation excluding adjusting items. Prior year tax items
represent income statement tax relating to underlying items
originally arising in prior years, including the impact of changes
in tax rates on deferred tax. The exclusion of items relating to
prior years, and those not in the ordinary course of business,
helps provide an indication of the Group's ongoing rate of tax.
Net debt comprises lease liabilities, borrowings and financing
derivatives (excluding accrued interest) less cash and cash
equivalents and short-term deposits, including such balances
classified as held for sale.
Refer to the Financial Review for definitions of all of the
Group's Alternative Performance Measures, including further
information on why they are used and details of where
reconciliations to statutory measures can be found where
applicable.
3. Accounting policies
The accounting policies adopted are consistent with those of the
annual financial statements for the year ended 31 January 2023, as
described in note 2 of those financial statements, except where set
out below. The critical accounting estimates and judgements are set
out in note 3 of the annual financial statements for the year ended
31 January 2023 and remain unchanged.
Taxes on income for interim periods are accrued using the best
estimate of the effective tax rate that would be applicable to
expected total annual earnings.
4. Segmental analysis
Income statement
Half year ended 31 July 2023
------------------------------------------------------------------
Other
GBP millions UK & Ireland France Poland Other International Total
------------------------------------------------ ------------- ------- ------- ------ --------------- --------
Sales 3,346 2,311 880 343 1,223 6,880
------------------------------------------------ ------------- ------- ------- ------ --------------- --------
Retail profit/(loss) 306 104 35 (12) 23 433
------- ------
Central costs (36)
Share of interest and tax of joint ventures and
associates (11)
Adjusting items (19)
------------------------------------------------ ------------- ------- ------- ------ --------------- --------
Operating profit 367
Net finance costs (50)
------------------------------------------------ ------------- ------- ------- ------ --------------- --------
Profit before taxation 317
------------------------------------------------ ------------- ------- ------- ------ --------------- --------
Half year ended 31 July 2022
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
------------------------ ------------- ------- ------- ------ -------------------- --------
Sales 3,221 2,325 913 350 1,263 6,809
------------------------ ------------- ------- ------- ------ -------------------- --------
Retail profit/(loss) 339 129 94 (7) 87 555
------- ------
Central costs (26)
Adjusting items 2
Operating profit 531
Net finance costs (57)
------------------------ ------------- ------- ------- ------ -------------------- --------
Profit before taxation 474
------------------------ ------------- ------- ------- ------ -------------------- --------
Year ended 31 January 2023
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
------------------------------------------- ------------- ------- ------- ------ -------------------- --------
Sales 6,200 4,452 1,734 673 2,407 13,059
------------------------------------------- ------------- ------- ------- ------ -------------------- --------
Retail profit/(loss) 603 195 148 (23) 125 923
------- ------
Central costs (49)
Share of interest and tax of joint
ventures and associates (4)
Adjusting items (147)
------------------------------------------- ------------- ------- ------- ------ -------------------- --------
Operating profit 723
Net finance costs (112)
------------------------------------------- ------------- ------- ------- ------ -------------------- --------
Profit before taxation 611
------------------------------------------- ------------- ------- ------- ------ -------------------- --------
Balance sheet
At 31 July 2023
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
---------------- ------------- ------- ------- ------ -------------------- --------
Segment assets 2,974 1,784 1,186 352 1,538 6,296
------- ------
Central assets 66
Goodwill 2,407
Net debt (2,181)
---------------- ------------- ------- ------- ------ -------------------- --------
Net assets 6,588
---------------- ------------- ------- ------- ------ -------------------- --------
At 31 July 2022
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
--------------------- ------------- ------- ------- ------ -------------------- --------
Segment assets 3,198 1,753 988 301 1,289 6,240
------- ------
Central liabilities (45)
Goodwill 2,424
Net debt (1,848)
--------------------- ------------- ------- ------- ------ -------------------- --------
Net assets 6,771
--------------------- ------------- ------- ------- ------ -------------------- --------
At 31 January 2023
------------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
---------------- ------------- ------- ------- ------ -------------------- ---------
Segment assets 3,084 1,914 1,106 366 1,472 6,470
------- ------
Central assets 59
Goodwill 2,408
Net debt (2,274)
---------------- ------------- ------- ------- ------ -------------------- ---------
Net assets 6,663
---------------- ------------- ------- ------- ------ -------------------- ---------
The operating segments disclosed above are based on the
information reported internally to the Board of Directors and Group
Executive, representing the geographical areas in which the Group
operates. The Group only has one reportable business segment, being
the supply of home improvement products and services. The majority
of the sales in each geographical area are derived from in-store
and online sales of products.
The 'Other International' segment consists of Poland, Iberia,
Romania, the joint venture Koçta in Turkey, NeedHelp, Screwfix
International and results from franchise agreements. Poland has
been shown separately due to its significance.
Central costs principally comprise the costs of the Group's head
office. Central assets and liabilities comprise unallocated head
office and other central items including pensions, insurance,
interest and tax.
The Group's sales, although generally not highly seasonal on a
half yearly basis, do increase over the Easter period and during
the summer months leading to slightly higher sales usually being
recognised in the first half of the year. However, due to the
continued uncertainty around the current macro-economic
environment, the phasing of sales is less predictable.
5. Adjusting items
Half year ended Half year ended Year ended
GBP millions 31 July 2023 31 July 2022 31 January 2023
--------------------------------------------------------- ---------------- ---------------- -----------------
Included within selling and distribution expenses
Net store asset impairment losses (14) - (139)
Operating model restructuring (7) - -
Release of France and other restructuring provisions - 1 3
(21) 1 (136)
--------------------------------------------------------- ---------------- ---------------- -----------------
Included within administrative expenses
Romania goodwill impairment - - (16)
Release of Castorama Russia disposal warranty liability - - 4
- - (12)
Included within other income
Profit on disposal of Crealfi associate investment 2 - -
Profit on exit of properties - 1 1
2 1 1
--------------------------------------------------------- ---------------- ---------------- -----------------
Adjusting items before tax (19) 2 (147)
Prior year and other adjusting tax items 7 3 29
--------------------------------------------------------- ---------------- ---------------- -----------------
Adjusting items (12) 5 (118)
--------------------------------------------------------- ---------------- ---------------- -----------------
In consideration of H1 2023/24 performance to date, we have
revised future projections for a number of stores across the
Group's portfolio. This has resulted in the recognition of GBP14m
of net store impairment charges in the period. These charges have
been recorded principally in France, Poland and Romania.
During the period, the Group commenced formal consultation with
employee representatives regarding a proposed Group Technology
operating model restructuring programme. Operating model
restructuring costs of GBP7m have been recorded in the period,
primarily related to this programme. The total cost is expected to
be c.GBP15m by FY 2024/25.
On 30 June 2023, the Group completed the disposal of its 49%
interest in its French associate investment Crealfi S.A., for cash
proceeds of GBP9m, resulting in a gain on disposal of GBP2m.
Prior year and other adjusting tax items relate principally to
deferred tax credits recorded in respect of the impairment and
restructuring expenses noted above, movements in prior year
provisions to reflect a reassessment of expected outcomes, and
refunds from tax authorities.
Refer to note 5 of the 2022/23 interim accounts for further
details on adjusting items for the half year ended 31 July 2022,
and to note 6 of the 2022/23 annual accounts for further details on
adjusting items for the year ended 31 January 2023.
6. Net finance costs
Year ended
GBP millions Half year ended 31 July 2023 Half year ended 31 July 2022 31 January 2023
---------------------------------- ------------------------------ ----------------------------- -----------------
Bank overdrafts, bank loans and
derivatives - (3) (3)
Fixed term debt (2) - (2)
Lease liabilities (62) (62) (124)
Finance costs (64) (65) (129)
----------------------------------- ----------------------------- ----------------------------- -----------------
Cash and cash equivalents and
short-term deposits 7 1 5
Net interest income on defined
benefit pension schemes 4 6 11
Other interest income 3 - -
Finance lease income - 1 1
Finance income 14 8 17
----------------------------------- ----------------------------- ----------------------------- -----------------
Net finance costs (50) (57) (112)
----------------------------------- ----------------------------- ----------------------------- -----------------
7. Income tax expense
Half year ended Half year ended Year ended
GBP millions 31 July 2023 31 July 2022 31 January 2023
------------------------------------------------ ---------------- ---------------- -----------------
UK corporation tax
Current tax on profits for the period (46) (29) (44)
Adjustments in respect of prior years 1 - 3
------------------------------------------------ ---------------- ---------------- -----------------
(45) (29) (41)
------------------------------------------------ ---------------- ---------------- -----------------
Overseas tax
Current tax on profits for the period (24) (49) (77)
Adjustments in respect of prior years 2 - 4
(22) (49) (73)
------------------------------------------------ ---------------- ---------------- -----------------
Deferred tax
Current period (13) (26) (25)
Adjustments in respect of prior years - 1 (3)
Adjustments in respect of changes in tax rates - 2 2
(13) (23) (26)
------------------------------------------------ ---------------- ---------------- -----------------
Income tax expense (80) (101) (140)
------------------------------------------------ ---------------- ---------------- -----------------
The adjusted effective tax rate on profit before adjusting items
is 26% (2022/23: 22%), representing the best estimate of the
effective rate for the full financial year. The adjusted effective
tax rate on the same basis for the year ended 31 January 2023 was
22%. The adjusted effective tax rate calculation is set out in the
Financial Review in part 1 of this announcement.
8. Earnings per share
Half year ended Year ended
Pence 31 July 2023 Half year ended 31 July 2022 31 January 2023
------------------------------------------ ---------------- ------------------------------ -----------------
Basic earnings per share 12.4 18.6 23.8
Effect of dilutive share options (0.2) (0.3) (0.3)
------------------------------------------ ---------------- ------------------------------ -----------------
Diluted earnings per share 12.2 18.3 23.5
------------------------------------------ ---------------- ------------------------------ -----------------
Basic earnings per share 12.4 18.6 23.8
Adjusting items before tax 1.0 (0.1) 7.4
Prior year and other adjusting tax items (0.4) (0.2) (1.5)
------------------------------------------ ---------------- ------------------------------ -----------------
Adjusted basic earnings per share 13.0 18.3 29.7
------------------------------------------ ---------------- ------------------------------ -----------------
Diluted earnings per share 12.2 18.3 23.5
Adjusting items before tax 1.0 (0.1) 7.3
Prior year and other adjusting tax items (0.4) (0.2) (1.4)
------------------------------------------ ---------------- ------------------------------ -----------------
Adjusted diluted earnings per share 12.8 18.0 29.4
------------------------------------------ ---------------- ------------------------------ -----------------
The calculation of basic and diluted earnings per share is based
on the profit for the period attributable to equity shareholders of
the Company. A reconciliation of statutory earnings to adjusted
earnings is set out below:
Year ended
GBP millions Half year ended 31 July 2023 Half year ended 31 July 2022 31 January 2023
--------------------------------- ----------------------------- ----------------------------- -----------------
Earnings 237 373 471
Adjusting items before tax 19 (2) 147
Prior year and other adjusting
tax items (7) (3) (29)
--------------------------------- ----------------------------- ----------------------------- -----------------
Adjusted earnings 249 368 589
--------------------------------- ----------------------------- ----------------------------- -----------------
The weighted average number of shares in issue during the
period, excluding those held in the Employee Share Ownership Plan
Trust ('ESOP trust'), is set out below:
Half year ended Year ended
Weighted average number of shares (millions) 31 July 2023 Half year ended 31 July 2022 31 January 2023
---------------------------------------------- ---------------- ----------------------------- -----------------
Basic 1,918 2,012 1,980
Diluted 1,943 2,035 2,002
---------------------------------------------- ---------------- ----------------------------- -----------------
9. Dividends
Half year ended Half year ended Year ended
GBP millions 31 July 2023 31 July 2022 31 January 2023
---------------------------------------------------------------- ---------------- ---------------- ----------------
Dividends to equity shareholders of the Company
Ordinary final dividend for the year ended 31 January 2023 of
8.60p per share 165 - -
Ordinary interim dividend for the year ended 31 January 2023 of
3.80p per share - - 74
Ordinary final dividend for the year ended 31 January 2022 of
8.60p per share - 172 172
165 172 246
---------------------------------------------------------------- ---------------- ---------------- ----------------
The proposed interim ordinary dividend for the period ended 31
July 2023 is 3.80p per share (2022/23: 3.80p per share).
10. Property, plant and equipment, investment property and other intangible assets
Additions to the cost of property, plant and equipment,
investment property and other intangible assets are GBP152m
(2022/23: GBP174m) and for the year ended 31 January 2023 were
GBP452m. Disposals in net book value of property, plant and
equipment, investment property, property assets held for sale and
other intangible assets are GBPnil (2022/23: GBP1m) and for the
year ended 31 January 2023 were GBP2m.
Capital commitments contracted but not provided for at the end
of the period are GBP50m (2022/23: GBP55m) and at 31 January 2023
were GBP19m.
11. Post-employment benefits
Half year ended Half year ended Year ended
GBP millions 31 July 2023 31 July 2022 31 January 2023
Net surplus in schemes at beginning of period 137 410 410
Current service cost (7) (6) (13)
Administration costs (2) (2) (4)
Net interest income 4 6 11
Net remeasurement losses (9) (14) (278)
Contributions paid by employer - 13 18
Exchange differences 4 (1) (7)
----------------------------------------------- ---------------- ---------------- ----------------
Net surplus in schemes at end of period 127 406 137
----------------------------------------------- ---------------- ---------------- ----------------
UK 243 542 251
Overseas (116) (136) (114)
----------------------------------------- ------ ------ ------
Net surplus in schemes at end of period 127 406 137
----------------------------------------- ------ ------ ------
Present value of defined benefit obligations (1,916) (2,408) (2,113)
Fair value of scheme assets 2,043 2,814 2,250
---------------------------------------------- -------- -------- --------
Net surplus in schemes at end of period 127 406 137
---------------------------------------------- -------- -------- --------
The assumptions used in calculating the costs and obligations of
the Group's defined benefit pension schemes are set by the
Directors after consultation with independent professionally
qualified actuaries. The assumptions are based on the conditions at
the time and changes in these assumptions can lead to significant
movements in the estimated obligations, as illustrated in the
sensitivity analysis provided in note 28 of the annual financial
statements for the year ended 31 January 2023.
A full actuarial valuation of the scheme is carried out every
three years by an independent actuary for the Trustee and the last
full valuation was carried out as at 31 March 2022. Following this
valuation and in accordance with the scheme's Statement of Funding
Principles, The Trustee and Kingfisher agreed to cease annual
employer contributions during the period from August 2022 to July
2025. This agreement was reached with reference to a funding
objective that targets a longer-term, low risk funding position in
excess of the minimum statutory funding requirements. This
longer-term objective is based on the principles of the scheme
reaching a point where it can provide benefits to members with a
high level of security, thereby limiting its reliance on the
employer for future support. The Company monitors the scheme
funding level on a regular basis and will reassess with the scheme
Trustee the appropriate level of contributions at future
valuations.
A key assumption in valuing the pension obligation is the
discount rate. Accounting standards require this to be set based on
market yields on high-quality corporate bonds at the balance sheet
date. The UK scheme discount rate is derived using a single
equivalent discount rate approach, based on the yields available on
a portfolio of high-quality Sterling corporate bonds with the same
duration as that of the scheme liabilities.
The principal financial assumptions for the UK scheme, being the
Group's principal defined benefit scheme, are set out below:
At At At
Annual % rate 31 July 2023 31 July 2022 31 January 2023
--------------------------- ------------- ------------- ----------------
Discount rate 5.15 3.40 4.50
Rate of pension increases 3.05 3.20 3.15
--------------------------- ------------- ------------- ----------------
12. Financial instruments
The Group holds the following derivative financial instruments
at fair value:
At At At
GBP millions 31 July 2023 31 July 2022 31 January 2023
---------------------------- ------------- ------------- ----------------
Foreign exchange contracts 4 84 16
---------------------------- ------------- ------------- ----------------
Derivative assets 4 84 16
---------------------------- ------------- ------------- ----------------
At At At
GBP millions 31 July 2023 31 July 2022 31 January 2023
---------------------------- ------------- ------------- ----------------
Foreign exchange contracts (57) (13) (52)
---------------------------- ------------- ------------- ----------------
Derivative liabilities (57) (13) (52)
---------------------------- ------------- ------------- ----------------
The fair values are calculated by discounting future cash flows
arising from the instruments and adjusted for credit risk. These
fair value measurements are all made using observable market rates
of interest, foreign exchange and credit risk. All the derivatives
held by the Group at fair value are considered to have fair values
determined by level 2 inputs as defined by the fair value hierarchy
of IFRS 13, 'Fair value measurement', representing significant
observable inputs other than quoted prices in active markets for
identical assets or liabilities. There are no non-recurring fair
value measurements nor have there been any transfers of assets or
liabilities between levels of the fair value hierarchy.
Except as detailed in the following table of borrowings, the
carrying amounts of financial instruments (excluding lease
liabilities) recorded at amortised cost in the financial statements
are approximately equal to their fair values. Where available,
market values have been used to determine the fair values of
borrowings. Where market values are not available or are not
reliable, fair values have been calculated by discounting cash
flows at prevailing interest and foreign exchange rates. This has
resulted in level 2 inputs for borrowings as defined by the IFRS 13
fair value hierarchy.
Carrying amount
At At At
GBP millions 31 July 2023 31 July 2022 31 January 2023
----------------- -------------- -------------- -----------------
Bank overdrafts 27 17 16
Bank loans 3 1 3
Fixed term debt 99 - 99
----------------- -------------- -------------- -----------------
Borrowings 129 18 118
----------------- -------------- -------------- -----------------
Fair value
-------------- -------------- -----------------
At At At
GBP millions 31 July 2023 31 July 2022 31 January 2023
----------------- -------------- -------------- -----------------
Bank overdrafts 27 17 16
Bank loans 4 1 3
Fixed term debt 107 - 102
----------------- -------------- -------------- -----------------
Borrowings 138 18 121
----------------- -------------- -------------- -----------------
Cash and borrowings balances at 31 July 2023, 31 July 2022 and
31 January 2023 reflect the grossing up of cash and overdraft
balances subject to the Group's cash pooling arrangements to ensure
the Group's presentation of these balances is in line with the
requirements for offsetting in accordance with IAS 32.
Fixed term debt comprises a GBP50m term loan maturing in
December 2024 and a GBP50m term loan maturing in January 2025.
As at 31 July 2023, the Group had an undrawn revolving credit
facility (RCF) of GBP550m, of which GBP504m is due to expire in May
2026 and GBP46m in May 2025 (2022/23: GBP550m RCF due to expire in
May 2025). As at 31 January 2023, the Group had an undrawn RCF of
GBP550m due to expire in May 2025.
13. Share capital
Number of Ordinary
ordinary shares share capital
millions GBP millions
Allotted, called up and fully paid:
At 1 February 2023 1,940 305
New shares issued under share schemes 2 -
Purchase of own shares for cancellation (41) (6)
----------------------------------------- ----------------- ---------------
At 31 July 2023 1,901 299
----------------------------------------- ----------------- ---------------
At 1 February 2022 2,066 325
New shares issued under share schemes 1 -
Purchase of own shares for cancellation (82) (13)
At 31 July 2022 1,985 312
----------------------------------------- ----------------- ---------------
At 1 February 2022 2,066 325
New shares issued under share schemes 5 1
Purchase of own shares for cancellation (131) (21)
----------------------------------------- ----------------- ---------------
At 31 January 2023 1,940 305
----------------------------------------- ----------------- ---------------
Ordinary shares have a par value of 155/(7) pence per share and
carry full voting, dividend and capital distribution rights.
During the period the Group purchased 41 million of the
Company's own shares for cancellation at a cost of GBP99m as part
of its capital returns programme.
14. Other reserves
Half year ended 31 July 2023
----------------------------------------------------------------
Cash flow
GBP millions Translation reserve hedge reserve Other Total
------------------------------------------------ -------------------- ------------------------ ------ --------
At 1 February 2023 150 (24) 159 285
------------------------------------------------ -------------------- ------------------------ ------ --------
Inventory cash flow hedges - fair value losses - (40) - (40)
Tax on items that will not be reclassified
subsequently to profit or loss - 9 - 9
Currency translation differences
Group (10) - - (10)
Joint ventures and associates (4) - - (4)
Transferred to income statement (2) - - (2)
Inventory cash flow hedges - losses transferred
to income statement - 9 - 9
Other comprehensive expense for the period (16) (22) - (38)
Inventory cash flow hedges - losses transferred
to inventories - 12 - 12
Tax on equity items - (4) - (4)
------------------------------------------------ -------------------- ------------------------ ------ --------
At 31 July 2023 134 (38) 159 255
------------------------------------------------ -------------------- ------------------------ ------ --------
Half year ended 31 July 2022
----------------------------------------------------------------
Cash flow
GBP millions Translation reserve hedge reserve Other Total
------------------------------------------------ -------------------- ------------------------ ------ --------
At 1 February 2022 10 27 159 196
------------------------------------------------ -------------------- ------------------------ ------ --------
Inventory cash flow hedges - fair value gains - 113 - 113
Tax on items that will not be reclassified
subsequently to profit or loss - (28) - (28)
Currency translation differences
Group (22) - - (22)
Joint ventures and associates (1) - - (1)
Other comprehensive (expense)/income for the
period (23) 85 - 62
Inventory cash flow hedges - gains transferred
to inventories - (61) - (61)
Tax on equity items (1) 15 - 14
------------------------------------------------ -------------------- ------------------------ ------ --------
At 31 July 2022 (14) 66 159 211
------------------------------------------------ -------------------- ------------------------ ------ --------
Year ended 31 January 2023
----------------------------------------------------------------
GBP millions Translation reserve Cash flow hedge reserve Other Total
------------------------------------------------ -------------------- ------------------------ ------ --------
At 1 February 2022 10 27 159 196
------------------------------------------------ -------------------- ------------------------ ------ --------
Inventory cash flow hedges - fair value gains - 58 - 58
Tax on items that will not be reclassified
subsequently to profit or loss - (12) - (12)
Currency translation differences
Group 129 - - 129
Joint ventures and associates 11 - - 11
Inventory cash flow hedges - gains transferred
to income statement - (5) - (5)
Other comprehensive income for the year 140 41 - 181
Inventory cash flow hedges - gains transferred
to inventories - (117) - (117)
Tax on equity items - 25 - 25
------------------------------------------------ -------------------- ------------------------ ------ --------
At 31 January 2023 150 (24) 159 285
------------------------------------------------ -------------------- ------------------------ ------ --------
15. Cash generated by operations
Half year ended Half year ended Year ended
GBP millions 31 July 2023 31 July 2022 31 January 2023
------------------------------------------------------------ ---------------- ---------------- -----------------
Operating profit 367 531 723
Share of post-tax results of joint ventures and associates 5 (5) (5)
Depreciation and amortisation 315 282 582
Net impairment charges 14 - 155
Gain on disposal of investments in associates (2) - -
Lease gains (1) (2) (2)
Share-based compensation charge 12 11 19
Increase in inventories (89) (395) (234)
Increase in trade and other receivables (53) (59) (44)
Increase/(decrease) in trade and other payables 219 231 (196)
Movement in provisions - (5) (13)
Movement in post-employment benefits 9 (5) (1)
------------------------------------------------------------ ---------------- ---------------- -----------------
Cash generated by operations 796 584 984
------------------------------------------------------------ ---------------- ---------------- -----------------
16. Net debt
At At At
GBP millions 31 July 2023 31 July 2022 31 January 2023
------------------------------------------------------------- ---------------- ---------------- -----------------
Cash and cash equivalents 344 496 286
Bank overdrafts (27) (17) (16)
------------------------------------------------------------- ---------------- ---------------- -----------------
Cash and cash equivalents and bank overdrafts 317 479 270
Bank loans (3) (1) (3)
Fixed term debt (99) - (99)
Lease liabilities (2,398) (2,318) (2,444)
Net financing derivatives 2 (8) 2
------------------------------------------------------------- ---------------- ---------------- -----------------
Net debt (2,181) (1,848) (2,274)
------------------------------------------------------------- ---------------- ---------------- -----------------
Half year ended Half year ended Year ended
GBP millions 31 July 2023 31 July 2022 31 January 2023
------------------------------------------------------------- ---------------- ---------------- -----------------
Net debt at beginning of period (2,274) (1,572) (1,572)
------------------------------------------------------------- ---------------- ---------------- -----------------
Net increase/(decrease) in cash and cash equivalents and
bank overdrafts 51 (329) (555)
Issue of fixed term debt - - (99)
Net cash flow 51 (329) (654)
Movements in lease liabilities 40 57 (41)
Exchange differences and other non-cash movements 2 (4) (7)
------------------------------------------------------------- ---------------- ---------------- -----------------
Net debt at end of period (2,181) (1,848) (2,274)
------------------------------------------------------------- ---------------- ---------------- -----------------
17. Contingent liabilities
The Group is subject to claims and litigation arising in the
ordinary course of business and provision is made where liabilities
are considered likely to arise on the basis of current information
and legal advice.
The Group files tax returns in many jurisdictions around the
world and at any one time is subject to periodic tax audits in the
ordinary course of its business. Applicable tax laws and
regulations are subject to differing interpretations and the
resolution of a final tax position can take several years to
complete. Where it is considered that future tax liabilities are
more likely than not to arise, an appropriate provision is
recognised in the financial statements.
In October 2017, the European Commission opened a state aid
investigation into the Group Financing Exemption section of the UK
controlled foreign company rules. While the Group has complied with
the requirements of UK tax law in force at the time, in April 2019
the European Commission concluded that aspects of the UK controlled
foreign company regime partially constitute illegal state aid. In
January 2021, the Group received a charging notice from HM Revenue
& Customs for GBP57m, which was paid in February 2021, with a
further GBP7m interest paid in April 2021.
The UK Government and the Group, along with other UK-based
multinational groups, appealed the European Commission decision to
the European Courts. On 8 June 2022, the General Court of the
European Union dismissed several of those appeals, including the UK
Government's. The decision of the General Court has been appealed
to the European Court of Justice.
The final impact on the Group remains uncertain but, based upon
advice taken, the Group continues to consider that the amount paid
of GBP64m plus accrued interest of GBP3m, which is included in
non-current assets, will ultimately be recovered.
Whilst the procedures that must be followed to resolve these
types of tax issues make it likely that it will be some years
before the eventual outcome is known, the Group does not currently
expect the outcome of these contingent liabilities to have a
material effect on the Group's financial position.
18. Related party transactions
The Group's significant related parties are its joint venture,
associate and pension schemes as disclosed in note 36 of the annual
financial statements for the year ended 31 January 2023. During the
period, the Group completed the disposal of its 49% interest in its
French associate investment Crealfi S.A. There have been no other
significant changes in related parties or related party
transactions in the period.
19. Post balance sheet events
During the period since the balance sheet date, the Group
purchased 4 million of the Company's own shares for cancellation at
a cost of GBP10m. This amount was deducted from equity in the half
year to 31 July 2023 as a result of an irrevocable buyback
agreement which was in place at 31 July 2023.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors confirm that the condensed interim financial
statements have been prepared in accordance with United Kingdom
adopted International Accounting Standard 34, "Interim Financial
Reporting", and that the Interim Results includes a fair review of
the information required by DTR 4.2.7 and DTR 4.2.8, namely:
-- an indication of important events that have occurred during
the period and their impact on the interim condensed financial
statements, and a description of the principal risks and
uncertainties for the remainder of the financial year; and
-- material related party transactions in the period and any
material changes in the related party transactions described in the
last annual report.
The Directors of Kingfisher plc were listed in the Group's
2022/23 Annual Report and Accounts. A list of current Directors is
maintained on the Kingfisher plc website which can be found at
www.kingfisher.com .
By order of the Board
Thierry Garnier Bernard Bot
Chief Executive Officer Chief Financial Officer
18 September 2023 18 September 2023
INDEPENDENT REVIEW REPORT TO KINGFISHER PLC
Conclusion
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 31 July 2023 which comprises the consolidated
income statement, the consolidated statement of comprehensive
income, the consolidated statement of changes in equity, the
consolidated balance sheet, the consolidated cash flow statement
and related notes 1 to 19.
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 31
July 2023 is not prepared, in all material respects, in accordance
with United Kingdom adopted International Accounting Standard 34
and the Disclosure Guidance and Transparency Rules of the United
Kingdom's Financial Conduct Authority.
Basis for Conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410 "Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity" issued by the Financial Reporting Council for use in the
United Kingdom (ISRE (UK) 2410). A review of interim financial
information consists of making inquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with
International Standards on Auditing (UK) and consequently does not
enable us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit.
Accordingly, we do not express an audit opinion.
As disclosed in note 2, the annual financial statements of the
group are prepared in accordance with United Kingdom adopted
international accounting standards and International Financial
Reporting Standards as issued by the IASB. The condensed set of
financial statements included in this half-yearly financial report
has been prepared in accordance with United Kingdom adopted
International Accounting Standard 34, "Interim Financial
Reporting".
Conclusion Relating to Going Concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
Conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This Conclusion is based on the review procedures performed in
accordance with ISRE (UK) 2410; however future events or conditions
may cause the entity to cease to continue as a going concern.
Responsibilities of the directors
The directors are responsible for preparing the half-yearly
financial report in accordance with the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct
Authority.
In preparing the half-yearly financial report, the directors are
responsible for assessing the group'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 company or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial
information
In reviewing the half-yearly financial report, we are
responsible for expressing to the company a conclusion on the
condensed set of financial statements in the half-yearly financial
report. Our Conclusion, including our Conclusion Relating to Going
Concern, are based on procedures that are less extensive than audit
procedures, as described in the Basis for Conclusion paragraph of
this report.
Use of our report
This report is made solely to the company in accordance with
ISRE (UK) 2410. Our work has been undertaken so that we might state
to the company those matters we are required to state to it in an
independent review 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, for our review work, for this
report, or for the conclusions we have formed.
Deloitte LLP
Statutory Auditor
London, United Kingdom
18 September 2023
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END
IR BIGDCDUBDGXI
(END) Dow Jones Newswires
September 19, 2023 02:00 ET (06:00 GMT)
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