TIDMBRBY
RNS Number : 8590L
Burberry Group PLC
18 May 2022
18 May 2022
Burberry Group plc
Preliminary results for 53 weeks ended 2 April 2022
Continued focus on luxury and accelerating growth
"Burberry is a unique British company with an extraordinary
history and heritage and it is a privilege to take the reins in
this next phase. The company has made great progress over the last
five years to elevate the brand, product and customer experience
into the luxury space. I look forward to setting out my plans for
building on these strong foundations and accelerating growth at the
interim results in November . "
Jonathan Akeroyd, Chief Executive Officer
Period ended 53 weeks ended 52 weeks YoY % change YoY % change
2 April ended 27 53 vs 52-week 52 vs 52-week
March
GBP million 2022 2021 Reported CER
FX
Revenue 2,826 2,344 21 23
Retail comparable store
sales* 18% (6% vs LLY**) (9%)
Retail full-price comparable
store sales* 24% (30% vs LLY**) 7%
Adjusted operating profit* 523 396 32 38
Adjusted operating profit
margin * 18.5% 16.9% +160bps +210bps
Adjusted Diluted EPS (pence)* 94.0 67.3 40 49
Reported operating profit 543 521 4
Reported operating profit
margin 19.2% 22.2%
Reported diluted EPS (pence) 97.7 92.7 5
Free cash flow* 340 349
Dividend (pence) 47.0 42.5 11
*See page 17 for definitions of alternative performance
measures, **LLY is compared with FY20
FY22 is a 53-week year. The comparative period is 52 weeks to 27
March 2021. To aid understanding, we are providing CER percentage
changes on a 52-week basis while absolute figures will be on a
reported basis including the 53(rd) week unless otherwise stated.
FY23 will be a 52-week year.
-- Despite a continuing challenging external environment, FY22
revenue increased 10% at CER vs LLY (+23% vs LY) with a material
improvement in the quality of our sales mix
-- Adjusted operating profit ahead of guidance, up 38% at CER to
GBP523m. Adjusted operating margin +210bps at CER demonstrates
significant progress towards our medium-term ambition, supported by
a strong gross margin
-- Q4 comparable store sales grew 7% vs LY with COVID-19
lockdowns in Mainland China weighing on performance in March
-- Strong brand momentum; excellent response to first in-person runway show in two years
-- Continued investment in outerwear and leather goods with
full-price sales up 39% and 28% vs LLY respectively in the year
-- Introduced new store concept, which is transforming how
customers experience brand and product; 47 stores now in the new
design, including Paris flagship on Rue Saint Honoré
-- Substantially met 2017-2022 responsibility targets; set new
industry-leading climate and nature commitments
-- Strong financials and cash conversion above 100%. Full-year
dividend per share of 47.0p up 11% vs LY, restoring our normal
pay-out ratio, and planned GBP400m share buy back for completion in
FY23
Outlook
We maintain our guidance of high single-digit revenue growth and
meaningful margin accretion at CER in the medium-term. Our outlook
is dependent on the impact of COVID-19 and rate of recovery in
consumer spending in Mainland China. While the current
macro-economic environment creates some near term uncertainty, we
are actively managing the headwind from inflation. Based on 6 May
2022 spot rates we expect a currency tailwind of GBP159m on revenue
and GBP92m on adjusted operating profit in FY23.
All metrics and commentary in the Group Financial Highlights and
Business and Financial Review exclude adjusting items unless stated
otherwise.
The following alternative performance measures are presented in
this announcement: CER, adjusted profit measures, comparable sales,
free cash flow, cash conversion, adjusted EBITDA and net debt. The
definition of these alternative performance measures are in the
Appendix on page 17.
Certain financial data within this announcement have been
rounded. Growth rates and ratios are calculated on unrounded
numbers.
Enquiries
Investors and analysts 020 3367 4458
Julian Easthope VP, Investor Relations julian.easthope@burberry.com
Media 020 3367 3764
Andrew Roberts SVP, Corporate Relations andrew.roberts@burberry.com
and Engagement
-- There will be a presentation today at 9.30am (UK time) to
investors and analysts at Horseferry House, Horseferry Road,
London, SW1P 2AW
-- The presentation can be viewed live on the Burberry website
www.burberryplc.com and can also be accessed live via a listen only
dial-in facility on +44 (0)20 3936 2999 (access code 069960)
-- The supporting slides and an indexed replay will be available
on the website later in the day
-- Burberry will issue its First Quarter Trading Update on 15 July 2022
-- The AGM will be held on 12 July 2022
Certain statements made in this announcement are forward-looking
statements. Such statements are based on current expectations and
are subject to a number of risks and uncertainties that could cause
actual results to differ materially from any expected future
results in forward-looking statements. Burberry Group plc
undertakes no obligation to update these forward-looking statements
and will not publicly release any revisions it may make to these
forward-looking statements that may result from events or
circumstances arising after the date of this document. Nothing in
this announcement should be construed as a profit forecast. All
persons, wherever located, should consult any additional
disclosures that Burberry Group plc may make in any regulatory
announcements or documents which it publishes. All persons,
wherever located, should take note of these disclosures. This
announcement does not constitute an invitation to underwrite,
subscribe for or otherwise acquire or dispose of any Burberry Group
plc shares, in the UK, or in the US, or under the US Securities Act
1933 or in any other jurisdiction.
Burberry is listed on the London Stock Exchange (BRBY.L) and is
a constituent of the FTSE 100 index. ADR symbol OTC:BURBY.
BURBERRY, the Equestrian Knight Device, the Burberry Check, and
the Thomas Burberry Monogram and Print are trademarks belonging to
Burberry.
www.burberryplc.com
Twitter: @BurberryCorp
LinkedIn: Burberry
GROUP FINANCIAL HIGHLIGHTS
Revenue
-- Revenue GBP2,826m +23% CER, +21% reported
-- Retail comparable store sales +18% (H1: +37%; H2: +7%)
-- Retail full-price comparable store sales +24% (H1: +49%; H2: 10%)
Adjusted profit
-- Adjusted operating profit GBP523m, +38% CER, +32% reported
-- Adjusted gross margin of 70.6%, +60bps at CER and reported
rates. Driven by higher mix of full-price sales and price rises
reflecting the underlying strength in the brand
-- Adjusted profit margin of 19.0% at CER, +210bps (18.5% reported)
-- Operating expenses before adjusting items rose 19% at CER
(+18% reported) due to higher investment and cost normalisation
-- Adjusted diluted EPS 94.0p, +49% at CER, +40% reported
Reported profit measures
-- Operating profit GBP543m, +4% after adjusting items of GBP20m
net credit (FY21: GBP125m net credit)
-- Diluted EPS 97.7p, +5% reported
Cash measures
-- Full year dividend per share declared of 47.0p (FY21: 42.5p) restoring a normal pay-out ratio
-- Free cash flow of GBP340m (FY21: GBP349m) due to strong cash management
-- Cash net of overdrafts and borrowings of GBP879m at 2 April
2022 (27 March 2021: GBP919m) with a GBP150m share buy back
completed in the year. Cash net of overdrafts amounted to GBP1.2bn
with borrowings of GBP298m
Summary income statement
Period ended 53 weeks 52 weeks YoY % change YoY % change
GBP million ended ended 53 vs 52-week 52 vs 52-week
2 April 27 March Reported CER
2022 2021 FX
Revenue 2,826 2,344 21 23
Cost of sales* (831) (704) 18
Gross profit* 1,995 1,640 22 24
Gross margin* 70.6% 70.0% +60bps +60bps
Operating expenses* (1,472) (1,244) 18 19
Opex as a % of sales* 52.1% 53.1%
Adjusted operating
profit* 523 396 32 38
Adjusted operating
margin * 18.5% 16.9% +160bps +210bps
Adjusting operating
items 20 125
Operating profit 543 521 4
Operating margin 19.2% 22.2%
Net finance (charge)(**) (32) (31)
Profit before taxation 511 490 4
Taxation (114) (114)
Non-controlling interest (1) -
Attributable profit 396 376
Adjusted profit before
taxation* 492 366 34 41
Adjusted diluted EPS
(pence)* 94.0 67.3 40 49
Diluted EPS (pence) 97.7 92.7 5
Weighted average number
of diluted ordinary
shares (millions) 404.8 405.1
* Excludes adjusting items. All items below adjusting operating
items on a reported basis unless otherwise stated
For detail, see Appendix. ** Includes adjusting finance charge
of GBP1m (FY21: GBP1m)
BUSINESS AND FINANCIAL REVIEW
FY22 was the first year of the growth and acceleration phase of
our strategy. In this chapter, our focus is on leveraging our
unique brand equity to deliver sustainable, high-quality growth,
while continuing our efforts to do well by doing right.
Despite a continuing challenging external environment, FY22
revenue increased 10% vs FY20 and 23% vs FY21 at CER. Full-price
comparable store sales advanced 30% vs LLY as our strategy to exit
mainline and digital markdowns drove a material enhancement in the
quality of our revenue streams. Regionally, Americas led full-price
comparable store sales growth with sales almost doubling in the US
compared with FY20. Full-price comparable store sales were also
strong in South Korea where they increased 81% and in Mainland
China where they rose over 50% compared with FY20, despite regional
lockdowns impacting our performance, particularly in March. We also
saw improving trends in EMEIA despite an ongoing headwind from
reduced tourists due to COVID-19 related travel restrictions.
We improved profitability with the adjusted gross margin, up
60bps to 70.6% at CER despite pressures from Brexit duties and
supply chain inflation. Adjusted operating profit came in ahead of
guidance, up 38% at CER vs FY21 to GBP523m at reported rates. FY22
also delivered a marked improvement in the operating leverage with
adjusted operating margin increasing to 19.0% at CER (18.5%
reported).
In the fourth quarter, we held our first in-person runway show
in two years with the unveiling of our Autumn/Winter 2022
collection. The show was a celebration of British culture, inspired
by London and our unique heritage, and highlighted icons from the
Burberry archive, including our Equestrian Knight Design. Compared
to the Autumn/Winter 2021 presentations, show views were up triple
digits helping to drive significant growth in followers on
Instagram and global press coverage was up double digits. In March,
we collaborated with Supreme to launch an exclusive selection of
pieces which sold out within seconds on Burberry.com and created a
lot of excitement around the stores and across social media.
We maintained our focus on strong, localised marketing
campaigns, engaging with customers through innovative, luxury
experiences. In the fourth quarter, we launched an immersive
Spring/Summer 2022 experience at our flagship store on Rodeo Drive,
Beverly Hills. As part of the store takeover, the exterior facade
of the building was enveloped in a kaleidoscopic abstract print
that we animated via an Instagram filter. Overall, our programme of
brand activities in the quarter generated strong reach and
engagement globally with a triple digit increase year-on-year in
follower growth rate on Instagram and continued strength in earned
reach, up strong double digits vs last year. In addition, we
continued to see strong momentum on Tik Tok passing the one million
follower milestone in the fourth quarter.
During the year, we invested in our focus categories outerwear
and leather goods. FY22 full-price outerwear sales grew 39% vs LLY
supported by our first dedicated campaign celebrating our iconic
offer. Leather goods also delivered a strong performance, with FY22
full-price sales up 28% vs LLY with the fourth quarter benefitting
from the Frances tote, a recent extension to the TB family as part
of our Summer 22 collection. As we enter FY23, we are excited about
the recent launch of the Lola bag campaign starring Bella Hadid,
Lourdes Leon, Jourdan Dunn and Ella Richards and supported by a
series of global World of Lola pop-ups and pop-ins.
We elevated the customer experience with the roll out of our new
store concept. In total, we now have 47 stores in the new design
including our Paris flagship on Rue Saint Honor é , with the
opening marked by the store exterior draped in the iconic Burberry
check in the Birch Brown colourway. The new store concept is
transforming how our customers experience our brand and product and
is supporting revenue growth. We have a further 65 stores planned
for FY23, meaning that by the end of the fiscal year, around a
quarter of our directly-operated stores will carry the new design.
Digital remains a key focus area for the business. We strengthened
the integration between our offline and online channels, expanding
our aftercare offer, enabling customers to access bespoke services
via Burberry.com and ensuring our sales associates can offer a
truly omnichannel experience for consumers.
We continued to take industry-leading steps to advance our
decarbonisation agenda and are proud to have substantially met all
targets we set as part of our 2017-2022 responsibility strategy. We
are now carbon neutral across our own operations globally; all the
electricity we use is from renewable sources; and almost all our
products have a positive attribute, meaning they carry a social or
environmental benefit. This strong foundation underpins our new
ambition to become Climate Positive by 2040, not only by becoming
net zero 10-years ahead of the 1.5-degree pathway set out in the
Paris Agreement but also by further reducing emissions across our
extended supply chain. At the same time, we set a new biodiversity
strategy, focused on protecting and restoring nature, expanding
support for farming communities and developing regenerative supply
chains.
We continued to support communities throughout the year,
exceeding our goal of positively impacting one million people by
2022 . We partnered once more with Marcus Rashford MBE and
charities across the UK, US and Asia to provide literacy skills and
safe creative spaces for underrepresented youth. We extended our
support for more equitable vaccine distribution to tackle the
global pandemic, with further donations to the UNICEF COVID-19
Vaccine Appeal through The Burberry Foundation. With millions of
lives impacted by the humanitarian crisis in Ukraine, we also
donated to the British Red Cross Ukraine Crisis Appeal, Save the
Children and UNICEF to help provide essential services to displaced
families, and we are donating more than 20,000 blankets to
Ukrainian refugees that we manufactured in Castleford and with our
supply partners in Italy.
We also maintained momentum on our global Diversity and
Inclusion strategy. Key initiatives include rolling out allyship
training across the business, introducing our first-ever global
bereavement policy, menopause support and policy for those
experiencing domestic violence. This year, we were proud to be the
inaugural sponsor of the British Diversity Awards, honouring
changemakers and supporting Galop, the chosen Charity of the Year.
On International Women's Day 2022, we announced our ambition to be
the best place to work for women in the industry. We are proud to
have been recognised for our efforts, including being recognised in
the Bloomberg Gender-Equality Index for a second consecutive year
and featuring as a best performer in the inaugural FTSE Women
Leaders report. We remain focused on continuous improvement to
drive positive change both within Burberry and beyond.
Financial performance
In total, the Group delivered record revenue, up 23% vs FY21 at
CER to GBP2,826m (FY21: GBP2,344m) against a backdrop of recovery
from the COVID-19 pandemic. Comparable store sales grew 18% vs
FY21, with underlying performance driven by full-price sales
partially offset by the exit of markdowns in mainline and digital
stores. With a 2% benefit from space and 2% contribution from the
53(rd) week, retail sales grew 19% at reported rates with a 3%
headwind from FX. Wholesale increased 35% at CER and 29% at
reported rates.
Group adjusted operating profit grew 38% at CER (+32% at
reported rates) to reach a record level at GBP523m with adjusted
operating margin, at 19.0% CER (18.5% reported). Adjusted gross
margin increased in the year by 60bps at CER and reported rates,
benefitting from a higher mix of full-price sales and price
increases. Adjusted operating expenses rose 19% at CER impacted by
higher investment and cost normalisation. Reported operating profit
increased 4% including an adjusting item net credit of GBP20m. FX
was a headwind of GBP33m, slightly higher than guided.
We generated free cash flow in the year of GBP340m (FY21:
GBP349m) with cash conversion remaining strong at 106% (FY21:
111%). Cash generated from operating activities increased
year-on-year driven by higher profits and reflecting tight working
capital management. Lease related payments and capital expenditure
increased against FY21 with investment in the retail network. Tax
paid increased significantly due to higher taxable profits in FY22
coupled with the prior year benefitting from accelerated payments
made in FY20.
Revenue analysis
Revenue by channel
53 weeks ended 52 weeks ended % change
2 April 27 March
Period ended 2022 2021
53 vs 52-week 52 vs 52-week
Reported CER
GBP million FX
Retail 2,273 1,910 19 20
Retail comparable store
sales growth 18% (9%)
Wholesale 512 396 29 35
Licensing 41 38 8 11
Revenue 2,826 2,344 21 23
Retail
FY22 vs LY FY22 vs LLY
Q1 Q2 H1 Q3 Q4 H2 FY Q1 Q2 H1 Q3 Q4 H2 FY
Comparable store
sales growth 90% 6% 37% 7% 7% 7% 18% 1% Flat 1% -3% 37% 11% 6%
Full-price comparable
sales growth 121% 10% 49% 15% 5% 10% 24% 26% 10% 18% 26% 68% 41% 30%
-- Retail sales +20% at CER; +19% reported
-- Impact of space +2%, 53(rd) week +2%
-- Total comparable store sales grew 6% vs LLY (+18% vs LY) with
ongoing disruption from the COVID-19 pandemic during the year,
particularly in the fourth quarter
-- Underlying performance was strong with full-price sales
growth of 30% vs LLY (+24% vs LY) partially offset by the planned
exit of markdown across mainline and digital stores and reduced
trade in outlets. Overall, markdowns had a 9% adverse impact on
FY22 comparable store sales growth vs LLY (-6% vs LY) and are no
longer a headwind in FY23
-- Comparable store sales grew 7% vs LY in the fourth quarter
with COVID-19 restrictions severely impacting our Asia business,
particularly in Mainland China. The quarter saw minimal headwind
from markdowns (-2% vs LY)
Comparable store sales by region:
FY22 vs Q1 Q2 H1 Q3 Q4 H2 FY Q4 vs
LLY LY
Group 1% flat 1% -3% 37% 11% 6% 7%
Asia Pacific 7% 3% 5% flat 59% 20% 13% -7%
EMEIA -38% -25% -31% -17% 10% -8% -18% 51%
Americas 34% 42% 38% 8% 45% 20% 28% 12%
Full-price comparable store sales by region:
FY22 vs Q1 Q2 H1 Q3 Q4 H2 FY Q4 vs
LLY LY
Group 26% 10% 18% 26% 68% 41% 30% 5%
Asia Pacific 23% 5% 14% 22% 78% 42% 29% -5%
EMEIA -33% -27% -30% -4% 29% 7% -11% 54%
Americas 114% 81% 98% 72% 87% 77% 86% 13%
Asia Pacific FY22 comparable store sales grew by 13% with
full-price up 29% vs LLY:
-- Mainland China comparable store sales grew 37% with
full-price comparable store sales up 54% vs LLY
-- South Korea outperformed with comparable store sales up 44%
vs LLY with continued strength in full-price comparable store
sales, 81% ahead of FY20
-- South Asia Pacific (SAP) declined by a double digit
percentage, affected by limited tourist traffic and airport store
closures
-- Japan also fell, impacted by a lack of international travel
EMEIA FY22 comparable store sales fell by 18% with full-price
down 11% vs LLY:
-- A resilient performance given the ongoing drag from lack of
tourists, which accounted for around 50% of annual pre-pandemic
revenues in the region
-- Continental Europe saw a decline broadly in line with the
regional average; however, total local European customer spend was
up over 30% vs LLY
-- The UK remained challenged with London performance weak given high tourist exposure
-- Middle East continues to grow, driven by strong local demand and improved tourist flows
Americas FY22 comparable store sales grew by 28% with full-price
up 86% vs LLY:
-- Americas has been the stand out region with full-price sales
in the US almost doubling vs LLY driven by new and younger
consumers to the brand
By product
-- Full-price sales grew across all product categories in FY22 vs LLY
-- Outerwear was driven by strong performance in Jackets, Quilts and Downs
-- Within Ready-to-wear, Tops and Bottoms continued to outperform
-- Leather goods remained a key focus in FY22 with extensions to
both the Lola and TB family. The core families continue to account
for more than 70% of our women's leather bag sales
Store footprint
The transformation of our distribution network continued as we
addressed high priority programmes:
-- In FY22 we opened 38 stores and closed 35 stores
-- Key openings included 3 new flagship stores; Sloane Street
(London), Rue Saint Honoré (Paris) and Plaza 66 (Shanghai)
-- During the year we completed 47 stores in the new design; 39
in Asia including 17 in South Korea and 13 in Mainland China, 5 in
EMEIA and 3 in Americas. We have 65 stores planned for FY23
-- Completed the non-strategic store rationalisation programme
over the past four years with 38 stores closed
Wholesale
Wholesale revenue increased 35% at CER (+29% at reported rates)
driven by strong orders in Americas and recovery in Asia from
travel retail.
Licensing
Licensing revenue grew 11% at CER and 8% at reported exchange
rates.
Operating profit analysis
Adjusted operating profit
Period ended 53 weeks 52 weeks % change
GBP million ended ended 27 March
2 April 2021
2022
53 vs 52-week 52 vs 52-week
Reported CER
FX
Revenue 2,826 2,344 21 23
Cost of sales* (831) (704)
Gross profit* 1,995 1,640
Gross margin %* 70.6% 70.0% +60bps +60bps
Operating expenses* (1,472) (1,244) 18 19
Opex as a % of sales* 52.1% 53.1%
Adjusted operating
profit* 523 396 32 38
Adjusted operating
margin %* 18.5% 16.9% +160bps +210bps
*Excludes adjusting items
Adjusted operating profit increased 38% at CER and margin up
210bps to 19.0% at CER:
-- Gross margin increased 60bps both at CER and reported rates
benefitting from a higher mix of full-price sales and price rises.
Adjusted operating expenses rose by 19% at CER against last year
impacted by higher investment and cost normalisation
-- Adjusted operating profit at GBP523m including a GBP33m FX headwind in FY22
Adjusting items(*)
Adjusting items were a net credit of GBP19m (FY21: GBP124m net
credit).
Period ended 53 weeks 52 weeks
GBP million ended ended
2 April 27 March
2022 2021
The impact of COVID-19
Inventory provisions 16 22
Rent concessions 18 54
Store impairments (5) 47
Government grants 2 9
Receivable impairments 1 5
COVID-19 adjusting items** 32 137
Restructuring costs (11) (30)
Profit on sale of property - 18
Revaluation of deferred consideration
liability (1) -
Adjusting operating items 20 125
Adjusting financing items (1) (1)
Adjusting items 19 124
*For more details see note 6 of the Financial Statements
** COVID-19 adjusting item includes a GBP16m credit (FY21:
GBP22m credit) that has been recognised through COGS relating to
inventory provisions
The major adjusting items are as follows:
-- Impact of the COVID-19 pandemic: we saw a total credit of
GBP32m from COVID-19 related adjustments with GBP16m representing
an inventory provision reversal, GBP18m of rent concessions and
GBP2m of Government grants. The GBP5m impairment charge relates to
a store that remains closed due to COVID related travel
restrictions
-- Restructuring costs: incurred GBP11m bringing the total of
our cost programmes to GBP139m of the GBP152m total expected by the
end of FY23, with cumulative cost savings of GBP205m, aligned to
guidance
Adjusted profit before tax*
After an adjusted net finance charge of GBP31m (FY21: GBP30m),
adjusted profit before tax was GBP492m (FY21: GBP366m).
*For detail on adjusting items see note 6 of the Financial
Statements
Taxation*
The effective tax rate on adjusted profit decreased to 22.2%
(FY21: 25.4%). This was lower than the prior year due to increased
adjusted profits rebalancing the geographical mix. The reported tax
rate on FY22 profit before taxation was 22.3% (FY21: 23.3%).
* For detail see note 8 of the Financial Statements
Cash flow
Represented statement of cash flows
The following table is a representation of the cash flows,
excluding the impact of adjusting items, to highlight the
underlying movements.
Period ended 53 weeks 52 weeks
GBP million ended ended
2 April 27 March
2022 2021
Adjusted operating profit 523 396
Depreciation and amortisation 313 277
Working capital 54 (25)
Other 19 29
Cash inflow from operations 909 677
Payment of lease principal and related
cash flows (206) (155)
Capital expenditure (161) (115)
Proceeds from disposal of non-current
assets 8 27
Interest (30) (27)
Tax (180) (58)
Free cash flow 340 349
Free cash flow was GBP340m (FY21: GBP349m) and cash conversion
was 106% (FY21: 111%) reflecting strong cash discipline. We had the
following key flows:
-- Working capital saw a GBP54m inflow. Within this, inventories
reduced in gross terms due to disciplined inventory control,
however on a net basis increased due to lower provisioning levels
generating an outflow of GBP22m in the year (FY21 inflow of
GBP21m). This was more than offset by a significant inflow in trade
payables resulting from timing of payments
-- Lease related payments increased GBP51m year-on-year to
GBP206m (FY21: GBP155m) primarily driven by lower COVID rent
rebates and new leases in the year
-- Capital expenditure increased GBP46m to GBP161m (FY21:
GBP115m) due to planned store network investment
-- Tax paid increased significantly to GBP180m (FY21: GBP58m)
due to higher taxable profits in FY22 coupled with the prior year
benefitting from accelerated payments made in FY20
Cash net of overdrafts at 2 April 2022 was GBP1.2bn (27 March
2021: GBP1.2bn). Our net debt(*) including reported lease
liabilities was GBP179m (27 March 2021: GBP101m). Net Debt
/adjusted EBITDA was 0.2x on a rolling 12 months period (27 March
2021: 0.1x), significantly below our target range of 0.5x to
1.0x.
A final dividend per share declared at 35.4p giving a full year
dividend per share of 47.0p (FY21: 42.5p) restoring our normal
pay-out ratio.
*For a definition of net debt see page 18.
Period ended 53 weeks 52 weeks
GBP million ended ended
2 April 27 March
2022 2021
Adjusted EBITDA - rolling
12 months 836 673
Cash net of overdrafts (1,177) (1,216)
Bond 298 297
Lease debt 1,058 1,020
Net Debt 179 101
Net Debt/Adjusted EBITDA 0.2x 0.1x
APPIX
Detailed guidance for FY23
Item Financial impact
Markdowns Markdowns were fully exited in FY22 and are
no longer a headwind going forward.
Wholesale revenue Wholesale is expected to be flat in H1 FY23.
Impact of retail Space is expected to be broadly stable in FY23.
space on revenues
Tax We expect the adjusted tax rate to be around
22%.
Capex Capex is expected to be GBP170m-GBP180m including
around 65 stores opened/refurbished in the
new format.
Currency At 6 May 2022 spot rates, the impact of year-on-year
exchange rate movements is expected to be a
GBP159m tailwind on revenue and GBP92m tailwind
on adjusted operating profit.
Dividend Final dividend per share recommended at 35.4p
and with the interim of 11.6p the combined
full year dividend per share amounted to 47.0p
- 11% ahead of FY21.
Share buy back Announced GBP400m planned share buy back to
be completed within FY23.
Calendar Please note that FY23 is a 52 week calendar
year with FY22 a 53 week year. The extra week
in FY22 contributed GBP35m revenue and GBP9m
adjusted operating profit .
Note: guidance based on CER at FY22 rates
Retail/wholesale revenue by destination*
Period ended 53 weeks 52 weeks % change
ended 2 April ended 27
March
GBP million 2022 2021 53 vs 52-week 52 vs 52-week
Reported FX CER
Asia Pacific (91% retail)* 1,276 1,203 6 7
EMEIA (65% retail)* 813 628 29 32
Americas (82% retail)* 696 475 46 51
Total 2,785 2,306 21 23
* Mix based on FY22
Retail/wholesale revenue by product division
Period ended 53 weeks 52 weeks % change
ended 2 ended 27
April March
GBP million 2022 2021 53 vs 52-week 52 vs 52-week
Reported FX CER
Accessories 1,017 841 21 24
Women's 784 653 20 22
Men's 807 668 21 23
Children's & other 177 144 23 25
Total 2,785 2,306 21 23
Store portfolio
Directly-operated stores
Stores Concessions Outlets Total Franchise
stores
At 27 March 2021 214 145 56 415 44
Additions 18 16 4 38 0
Closures (14) (18) (3) (35) (6)
At 2 April 2022 218 143 57 418 38
Store portfolio by region*
Directly-operated stores
Stores Concessions Outlets Total Franchise
At 2 April 2022 stores
Asia Pacific 107 93 24 224 7
EMEIA 52 41 18 111 31
Americas 59 9 15 83 -
Total 218 143 57 418 38
*Excludes the impact of pop up stores
Adjusted operating 53 weeks ended 52 weeks % change % change
profit* 2 April ended 53 vs 52-week 52 vs 52-week
Period ended 2022 27 March Reported CER
GBP millions 2021 FX
Retail/wholesale 486 361 35 41
Licensing 37 35 7 10
Adjusted operating
profit 523 396 32 38
Adjusted operating
margin 18.5% 16.9% +160bps +210bps
*For additional detail on adjusting items see note 6 of the
Financial Statements
Exchange rates
Spot rates Average effective exchange
rates
6 May FY22 FY21
GBP1= 2022
Euro 1.17 1.18 1.12
US Dollar 1.24 1.36 1.30
Chinese Yuan Renminbi 8.21 8.73 8.85
Hong Kong Dollar 9.70 10.63 10.08
Korean Won 1,553 1,596 1,514
Profit before tax reconciliation
Period ended 53 weeks 52 weeks % change % change
GBP million ended ended 53 vs 52-week 52 vs 52-week
2 April 27 March Reported CER
2022 2021 FX
Adjusted profit
before tax 492 366 34 41
Adjusting items*
COVID-19 related
items 32 137
Restructuring costs (11) (30)
Profit on sale of
property - 18
Revaluation of deferred
consideration liability (1) -
Adjusting financing
items (1) (1)
Profit before tax 511 490 4
*For additional detail on adjusting items see note 6 of the
Financial Statements
Alternative performance measures
Alternative performance measures (APMs) are non-GAAP measures.
The Board uses the following APMs to describe the Group's financial
performance and for internal budgeting, performance monitoring,
management remuneration target setting and for external reporting
purposes.
APM Description and purpose GAAP measure reconciled to
Constant This measure removes the Results at reported rates
Exchange effect of changes in exchange
Rates (CER) rates and the 53(rd) week
compared to the prior
period. The constant exchange
rate incorporates both
the impact of the movement
in exchange rates on the
translation of overseas
subsidiaries' results
and also on foreign currency
procurement and sales
through the Group's UK
supply chain.
Comparable The year-on-year change Retail Revenue:
sales in sales from stores trading Period ended 53 weeks 52 weeks
over equivalent time periods YoY% ended 2 ended 27
and measured at constant April March
foreign exchange rates. 2022 2021
It also includes online Comparable
sales. This measure is sales* 18% (9%)
used to strip out the Change in
impact of permanent store space 2% -
openings and closings, CER retail 20% (9%)
or those closures relating 53(rd) week 2% -
to refurbishments, allowing FX (3%) -
a comparison of equivalent Retail revenue 19% (9%)
store performance against
the prior period. The *Includes full-price comp +24%
measurement of comparable (FY21 +7%)
sales has not excluded
stores temporarily closed
as a result of the COVID-19
outbreak.
Full-price sales:
Full-price comparable
store sales are sales
from items sold at full
retail price in our own
mainline retail network
and online.
Comparable The change in sales over Retail Revenue:
sales vs two years measured at Period ended 53 weeks
LLY constant foreign exchange % change ended
rates. It also includes 2 April
online sales. The measurement 2022
of comparable sales has Comparable
not excluded stores temporarily sales 6%
closed as a result of Change in
the COVID-19 outbreak. space 4%
This measure reflects CER retail 10%
the two year aggregation 53(rd) week 2%
of the growth rates. FX (4%)
Retail revenue 8%
Adjusted Adjusted profit measures Reported Profit:
Profit are presented to provide A reconciliation of reported profit
additional consideration before tax to adjusted profit
of the underlying performance before tax and the Group's accounting
of the Group's ongoing policy for adjusted profit before
business. These measures tax are set out in the financial
remove the impact of those statements.
items which should be
excluded to provide a
consistent and comparable
view of performance .
Free Cash Free cash flow is defined Net cash generated from operating
Flow as net cash generated activities:
from operating activities Period ended 53 weeks 52 weeks
less capital expenditure GBPm ended ended
plus cash inflows from 2 April 27 March
disposal of fixed assets 2022 2021
and including cash outflows Net cash generated
for lease principal payments from operating
and other lease related activities 699 592
items. Capex (161) (115)
Lease principal
and related
cash flows (206) (155)
Proceeds from
disposal of
non-current
assets 8 27
Free cash flow 340 349
Cash Conversion Cash conversion is defined Net cash generated from operating
as free cash flow pre-tax/adjusted activities:
profit before tax. It Period ended 53 weeks 52 weeks
provides a measure of GBPm ended ended
the Group's effectiveness 2 April 27 March
in converting its profit 2022 2021
into cash. Free cash
flow 340 349
Tax paid 180 58
Free cash
flow before
tax 520 407
Adjusted
profit before
tax 492 366
Cash conversion 106% 111%
Net Debt Net debt is defined as Cash net of overdrafts:
the lease liability recognised Period ended 53 weeks 52 weeks
on the balance sheet plus GBPm ended ended
borrowings less cash net 2 April 27 March
of overdrafts. 2022 2021
Cash net of
overdrafts 1,177 1,216
Lease liability (1,058) (1,020)
Borrowings (298) (297)
Net debt (179) (101)
Adjusted Adjusted EBITDA is defined Reconciliation from operating profit
EBITDA as operating profit, excluding to adjusted EBITDA:
adjusting operating items, Period ended 53 weeks 52 weeks
depreciation of property, GBPm ended ended
plant and equipment, depreciation 2 April 27 March
of right of use assets 2022 2021
and amortisation of intangible Operating profit 543 521
assets. Any depreciation Adjusted operating
or amortisation included items (20) (125)
in adjusting operating Amortisation
items are not double-counted. of intangible
Adjusted EBITDA is shown assets 39 33
for the calculation of Depreciation
Net Debt/EBITDA for our of property,
gearing ratios. plant and equipment 86 72
Depreciation
of right-of-use
assets 188 172
Adjusted EBITDA 836 673
Group Income Statement
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Revenue 3 2,826 2,344
Cost of sales (815) (682)
Gross profit 2,011 1,662
Net operating expenses 4 (1,468) (1,141)
Operating profit 543 521
Financing
Finance income 3 3
Finance expense (34) (33)
Other financing charge (1) (1)
Net finance expense 7 (32) (31)
Profit before taxation 5 511 490
Taxation 8 (114) (114)
Profit for the year 397 376
Attributable to:
Owners of the Company 396 376
Non-controlling interest 1 -
Profit for the year 397 376
Earnings per share
Basic 9 98.2p 93.0p
Diluted 9 97.7p 92.7p
GBPm
Reconciliation of adjusted profit before
taxation:
Profit before taxation 511 490
Adjusting operating items:
Cost of sales (income) 5 (16) (22)
Net operating (income)/expenses 5 (4) (103)
Adjusting financing items 5 1 1
Adjusted profit before taxation - non-GAAP
measure 492 366
Adjusted earnings per share - non-GAAP
measure
Basic 9 94.5p 67.5p
Diluted 9 94.0p 67.3p
Dividends per share
Interim 10 11.6p -
Proposed final (not recognised as a liability
at 2 April/27 March) 10 35.4p 42.5p
Group statement of comprehensive income
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Profit for the year 397 376
Other comprehensive income(1) :
Cash flow hedges (1) -
Foreign currency translation differences 22 (51)
Actuarial gains on post-employment benefit
plans - 1
Tax on other comprehensive income:
Foreign currency translation differences 8 - 2
Other comprehensive (loss)/income for
the year, net of tax 21 (48)
Total comprehensive income for the year 418 328
Total comprehensive income attributable
to:
Owners of the Company 417 328
Non-controlling interest 1 -
418 328
All items included in other comprehensive income, with the
exception of actuarial gains on post-employment benefit plans, may
subsequently
Group Balance Sheet
As at As at
2 April 27 March
2022 2021
Note GBPm GBPm
ASSETS
Non-current assets
Intangible assets 11 240 237
Property, plant and equipment 12 322 280
Right-of-use assets 13 880 818
Investment properties - 3
Deferred tax assets 14 175 137
Trade and other receivables 15 45 45
1,662 1,520
Current assets
Inventories 16 426 402
Trade and other receivables 15 283 277
Derivative financial assets 5 2
Income tax receivables 86 40
Cash and cash equivalents 17 1,222 1,261
Assets held for sale 12 13 -
2,035 1,982
Total assets 3,697 3,502
LIABILITIES
Non-current liabilities
Trade and other payables 18 (91) (99)
Lease liabilities 19 (849) (810)
Borrowings 22 (298) (297)
Deferred tax liabilities 14 (1) (1)
Retirement benefit obligations (1) (1)
Provisions for other liabilities and charges 20 (36) (32)
(1,276) (1,240)
Current liabilities
Trade and other payables 18 (481) (393)
Bank overdrafts 21 (45) (45)
Lease liabilities 19 (209) (210)
Derivative financial liabilities (2) (2)
Income tax liabilities (39) (28)
Provisions for other liabilities and charges 20 (28) (24)
(804) (702)
Total liabilities (2,080) (1,942)
Net assets 1,617 1,560
EQUITY
Capital and reserves attributable to owners of the Company
Ordinary share capital 23 - -
Share premium account 227 223
Capital reserve 23 41 41
Hedging reserve 23 4 5
Foreign currency translation reserve 23 218 196
Retained earnings 1,123 1,092
Equity attributable to owners of the Company 1,613 1,557
Non-controlling interest in equity 4 3
Total equity 1,617 1,560
Group statement of changes in equity
Attributable to
owners
of the Company
Ordinary Share
share premium Other Retained Non-controlling Total
capital account reserves earnings Total interest equity
Note GBPm GBPm GBPm GBPm GBPm GBPm GBPm
Balance as at 28 March
2020 - 221 291 702 1,214 5 1,219
Profit for the year - - - 376 376 - 376
Other comprehensive income:
Foreign currency translation
differences 23 - - (51) - (51) - (51)
Actuarial gains on post-employment
benefit plans - - - 1 1 - 1
Tax on other comprehensive
income 23 - - 2 - 2 - 2
Total comprehensive income
for the year - - (49) 377 328 - 328
Transactions with owners:
Employee share incentive
schemes
Equity share awards - - - 12 12 - 12
Tax on share awards - - - 1 1 - 1
Exercise of share options - 2 - - 2 - 2
Acquisition of additional
interest in subsidiary - - - - - (2) (2)
Balance as at 27 March
2021 - 223 242 1,092 1,557 3 1,560
Profit for the year - - - 396 396 1 397
Other comprehensive income:
Cash flow hedges - - (1) - (1) - (1)
Foreign currency translation
differences 23 - - 22 - 22 - 22
Total comprehensive income
for the year - - 21 396 417 1 418
Transactions with owners:
Employee share incentive
schemes
Equity share awards - - - 16 16 - 16
Equity share awards transferred
to liabilities - - - (1) (1) - (1)
Exercise of share options - 4 - - 4 - 4
Purchase of own shares
Share buyback - - - (153) (153) - (153)
Held by ESOP trusts - - - (8) (8) - (8)
Dividends paid in the
year - - - (219) (219) - (219)
Balance as at 2 April
2022 - 227 263 1,123 1,613 4 1,617
GROUP STATEMENT OF CASH FLOWS
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Cash flows from operating activities
Operating profit 543 521
Amortisation of intangible assets 11 39 33
Depreciation of property, plant and equipment 12 86 71
Depreciation of right-of-use assets 13 188 172
COVID-19-related rent concessions 1 (18) (54)
Impairment charge of intangible assets 11 - 9
Net impairment charge/(reversal) of property,
plant and equipment 12 1 (7)
Net impairment charge/(reversal) of right-of-use
assets 13 7 (34)
Gain on disposal of property, plant and
equipment and intangible assets (3) (23)
Gain on disposal of right-of-use assets - (1)
(Gain)/Loss on derivative instruments (4) 4
Charge in respect of employee share incentive
schemes 16 12
(Payment) of settlement of equity swap
contracts - (1)
(Increase)/decrease in inventories (22) 21
Increase in receivables (5) (39)
Increase/(decrease) in payables and provisions 81 (7)
Cash generated from operating activities 909 677
Interest received 2 3
Interest paid (32) (30)
Taxation paid (180) (58)
Net cash generated from operating activities 699 592
Cash flows from investing activities
Purchase of property, plant and equipment (124) (73)
Purchase of intangible assets (37) (42)
Proceeds from sale of property, plant
and equipment 8 27
Initial direct costs of right-of-use assets (4) (3)
Payment in respect of acquisition of subsidiary (7) -
Net cash outflow from investing activities (164) (91)
Cash flows from financing activities
Dividends paid in the year 10 (219) -
Payment of deferred consideration for
acquisition of non-controlling interest 18 (3) (3)
Proceeds from borrowings 22 - 595
Repayment of borrowings 22 - (600)
Payment of lease principal 19 (202) (151)
Payment on termination of lease - -
Payment to acquire additional interest
in subsidiary from non--controlling interest - (2)
Issue of ordinary share capital 4 2
Purchase of own shares through share buy-back 23 (150) -
Purchase of own shares through share buy-back
- stamp duty and fees 23 (3) -
Purchase of own shares by ESOP trusts (8) -
Net cash outflow from financing activities (581) (159)
Net increase in cash net of overdrafts (46) 342
Effect of exchange rate changes 7 (13)
Cash net of overdrafts at beginning of
year 1,216 887
Cash net of overdrafts 1,177 1,216
53 weeks
to As at
2 April 27 March
2022 2021
Note GBPm GBPm
Cash and cash equivalents 17 1,222 1,261
Bank overdrafts 21 (45) (45)
Cash net of overdrafts 1,177 1,216
Notes to the Financial Statements
1. Basis of preparation
Burberry Group plc and its subsidiaries (the Group) is a global
luxury goods manufacturer, retailer and wholesaler. The Group also
licenses third parties to manufacture and distribute products using
the 'Burberry' trademarks. All of the companies which comprise the
Group are controlled by Burberry Group plc (the Company) directly
or indirectly.
The consolidated financial statements of the Group have been
prepared in accordance with the requirements of the Companies Act
2006 and UK-adopted International Accounting Standards. These
consolidated financial statements have been prepared under the
historical cost convention, except as modified by the revaluation
of certain financial assets and financial liabilities at fair value
through profit or loss.
Statutory accounts for the 52 weeks to 27 March 2021 have been
filed with the Registrar of Companies, and those for 2022 will be
delivered in due course. The reports of the auditors on those
statutory accounts for the 52 weeks to 27 March 2021 and the 53
weeks to 2 April 2022 were unqualified, did not contain an emphasis
of matter paragraph and did not contain a statement under either
section 400(2) or section 498(3) of the Companies Act 2006.
The consolidated financial statements are presented in GBPm in
order to align external reporting with the information presented to
the Chief Operating Decision Maker. Prior year comparatives have
been rounded accordingly.
Consideration of climate-related matters
The Group has performed a climate-related scenario analysis as
required by the Task Force for Climate Related Financial
Disclosures. This scenario analysis takes into consideration
different climate-related scenarios, including a 2degC or lower
scenario. Based on this scenario analysis, consideration has been
given to the impact of climate-related risks on management's
judgements and estimates, including inventory provisions and the
impairment of property, plant and equipment and right-of-use
assets.
The impact of climate-related risks on the consolidated
financial statements for the 53 weeks to 2 April 2022 is not
material.
The incurred costs and investments associated with our
sustainability strategy are reflected in the Group's financial
statements, including within inventories, property, plant and
equipment, and operating profit.
The committed future financial investments associated with our
sustainability strategy are included within our budget and three
year forward looking financial plans. These financial plans have
been used to support our impairment reviews and going concern and
viability assessment. Future plans may incur additional investment
on research and development and higher expenditure on raw
materials.
Going concern
The impact of the COVID-19 pandemic on the global economy and
the operating activities of many businesses, including the luxury
market, has resulted in a volatile business environment and
continued uncertainty. The future impact of this pandemic and the
challenging economic conditions is uncertain at the date of signing
these financial statements. In considering the appropriateness of
adopting the going concern basis in preparing the financial
statements, the directors have assessed the potential cash
generation of the Group and considered a range of downside
scenarios. This assessment for any indicators that the going
concern basis of preparation is not appropriate covers the period
from the date of signing the financial statements up to 30
September 2023.
The directors have assessed the potential cash generation of the
Group against a range of projected scenarios (including a severe
but plausible downside). These scenarios were informed by a
comprehensive review of the macroeconomic scenarios using third
party projections of scientific, epidemiological and macroeconomic
data for the luxury fashion industry:
-- The Group central planning scenario reflects a balanced
projection with a continued focus on growing markets and
maintaining momentum built as part of the strategy
-- As a sensitivity, this central planning scenario has been
flexed to reflect a 15% downgrade to revenues in FY 2022/23, as
well as the associated consequences for EBITDA and cash. Management
consider this represents a severe but plausible downside scenario
appropriate for assessing going concern
The severe but plausible downside considered the Group's
principal risks and aggregated:
-- A longer term significant impact of the COVID-19 pandemic on
revenue to September 2023 compared to the central planning
scenario
-- A significant reputational incident such as negative
sentiment propagated through social media
-- A reduction in the GDP growth assumptions in the Eurozone and
Americas materialising in the second half of FY 2022/23
-- The impact of a 1 month interruption in one of our channels
arising from a technology vulnerability
-- The introduction of carbon taxes in FY 2023/24 in line with a
scenario reflecting a 2oC global temperature increase compared to
pre-industrial levels
-- A short term impact of a 10% weakening in a key non-sterling
currency for the Group before it is recovered through price
adjustment
The directors have considered mitigating actions, which may be
taken to reduce discretionary and other operating cash outflows.
The directors have also considered the Group's current liquidity
and available facilities. Details of cash, overdrafts, borrowings
and facilities are set out in notes 17, 21 and 22 respectively of
these financial statements, which includes access to a GBP300
million revolving credit facility, currently undrawn and not relied
upon in this going concern assessment.
In all the scenarios assessed, taking into account current
liquidity and available facilities, the Group was able to maintain
sufficient liquidity to continue trading. On the basis of the
assessment performed, the directors consider it is appropriate to
continue to adopt the going concern basis in preparing the
consolidated financial statements for the 53 weeks ended 2 April
2022.
New standards, amendments and interpretations adopted in the
period
There have been no new standards or interpretations issued and
made effective for the financial period commencing 28 March 2021
that have had a material impact on the financial statements of the
Group. The following amendment to IFRS 16 was applied in the
financial statements for the 52 weeks to 27 March 2021 and
continued to be applied in the financial statements for the 53
weeks to 2 April 2022.
IFRS 16 Leases - COVID-19-Related Rent Concessions
The COVID-19-Related Rent Concessions amendment to IFRS 16
Leases was adopted by the IASB on 28 May 2020 and endorsed by the
United Kingdom on 12 October 2020. The amendment was intended to
apply until 30 June 2021, but as the impact of the COVID-19
pandemic is continuing, on 31 March 2021, the IASB extended the
period of application of the practical expedient to 30 June 2022.
The amendment allows for a simplified approach to accounting for
rent concessions occurring as a direct result of COVID-19 and for
which the following criteria are met:
-- The revised consideration is substantially the same, or less
than, the consideration prior to the change
-- The concessions affect only payments originally due on or before 30 June 2022 and
-- There is no substantive change to other terms and conditions of the lease
Lessees are not required to assess whether eligible rent
concessions are lease modifications, allowing the lessee to account
for eligible rent concessions as if they were not lease
modifications. During the period, the Group has agreed rent
concessions both in the form of rent forgiveness in which the
landlord has agreed to forgive all or a portion of rents due with
no obligation to be repaid in the future, and rent deferrals in
which the landlord has agreed to forego rents in one period with a
proportional increase in rents due in a future period.
The Group has chosen to account for eligible rent forgiveness as
negative variable lease payments. The rent concession has been
recognised once a legally binding agreement is made between both
parties by derecognising the portion of the lease liability that
has been forgiven and recognising the benefit in the Income
Statement. As a result, the Group has recognised GBP18 million
(last year: GBP54 million) in COVID-19-related rent concessions in
the Income Statement within "net operating expenses" in the current
period. This has been presented as an adjusting item (refer to note
6). In the Statement of Cash Flows, the forgiveness results in
lower payments of lease principal. The negative variable lease
payments in the Income Statement is a non-cash item which is added
back to calculate cash generated from operating activities.
Rent deferrals do not change the total consideration due over
the life of the lease. Deferred rent payments are recognised as a
payable until the period the original rent payment is due. As a
result, the Group has recognised GBPnil million (last year: GBP4
million) within other payables. Payments relating to rent deferrals
are recognised as payments of lease principal when the payment is
made.
Standards not yet adopted
Certain new accounting standards and interpretations have been
published that are not mandatory for the 53 weeks to 2 April 2022
and have not been early adopted by the Group. These standards are
not expected to have a material impact on the entity in the current
or future reporting periods and on foreseeable future
transactions
Basis of consolidation
The Group's annual financial statements comprise those of
Burberry Group plc (the Company) and its subsidiaries, presented as
a single economic entity. The results of the subsidiaries are
prepared for the same reporting year as the Company, using
consistent accounting policies across the Group.
The financial year is the 53 weeks ended 2 April 2022 (last
year: 52 weeks ended 27 March 2021).
Subsidiaries are all entities (including special purpose
entities) over which the Group has control. The Group controls an
entity when the Group is exposed to, or has rights to, variable
returns from its involvement with the entity and has the ability to
affect those returns through its power over the entity.
Subsidiaries are fully consolidated from the date on which control
is transferred to the Group and cease to be consolidated from the
date on which control is transferred out of the Group. Where there
is a loss of control of a subsidiary, the consolidated financial
statements include the results for the portion of the reporting
period during which the Group had control. Intra-Group
transactions, balances and unrealised profits on transactions
between Group companies are eliminated in preparing the Group
financial statements. The Group treats transactions with
non-controlling interests as transactions with equity owners of the
Group. For acquisitions of additional interests in subsidiaries
from non-controlling interests, the difference between any
consideration paid and the relevant share acquired of the carrying
value of net assets of the subsidiary is recorded in equity. Gains
or losses on disposals of interests in subsidiaries to
non-controlling interests are also recorded in equity.
Key sources of estimation uncertainty
Preparation of the consolidated financial statements in
conformity with IFRS requires that management make certain
estimates and assumptions that affect the measurement of reported
revenues, expenses, assets and liabilities and the disclosure of
contingent liabilities.
If in the future such estimates and assumptions, which are based
on management's best estimates at the date of the financial
statements, deviate from actual circumstances, the original
estimates and assumptions will be updated as appropriate in the
period in which the circumstances change.
Estimates are continually evaluated and are based on historical
experience and other factors, including expectations of future
events that are believed to be reasonable under the
circumstances.
The COVID-19 pandemic continued to have an impact on the global
economy throughout the current year. While the adverse impact on
the Group's operations and financial position has significantly
diminished during the course of the financial year, at the date of
signing these financial statements, there remains significant
uncertainty regarding the timing of any global recovery from
COVID-19, and the return to previous levels of footfall in city
centres, travel and tourism in some locations. As a result, the
impact of COVID-19 on the Group's assets remains a significant
source of estimation uncertainty.
The key areas where the estimates and assumptions applied have a
significant risk of causing a material adjustment to the carrying
value of assets and liabilities within the next financial year are
discussed below. Further details of the Group's accounting policies
in relation to these areas are provided in note 2.
Impairment, or reversals of impairment, of property, plant and
equipment and right-of-use assets
Property, plant and equipment and right-of-use assets are
reviewed for impairment if events or changes in circumstances
indicate that the carrying amount may not be recoverable. When a
review for impairment is conducted, the recoverable amount of an
asset or a cash generating unit is determined based on value in use
calculations prepared using management's best estimates and
assumptions at the time.
In March 2020, management recorded impairments of retail
property, plant and equipment and right-of-use assets, based on the
estimated impact of COVID-19 on the Group. At that time, the impact
of COVID-19 was at its highest and many of the Group's retail
stores worldwide were closed. Since March 2020, the rate of
recovery has exceeded management estimates, and a partial reversal
of this initial impairment was recognised at March 2021. Management
has updated these assumptions again as at 2 April 2022, reflecting
their latest plans over the next three years to March 2025,
followed by longer-term growth rates of mid-single digits and
inflation rates appropriate to each store's location.
Management has also reviewed the remaining retail property,
plant and equipment and right-of-use assets, not covered by the
above reassessment, for any indications of impairment.
Refer to notes 12 and 13 for further details of retail property,
plant and equipment, right-of-use assets and impairment reviews
carried out in the period and for sensitivities relating to this
key source of estimation uncertainty.
Inventory provisioning
The Group manufactures and sells luxury goods and is subject to
changing consumer demands and fashion trends. The recoverability of
the cost of inventories is assessed every reporting period, by
considering the expected net realisable value of inventory compared
to its carrying value. Where the net realisable value is lower than
the carrying value, a provision is recorded. When calculating
inventory provisions, management considers the nature and condition
of the inventory, as well as applying assumptions in respect of
anticipated saleability of finished goods and future usage of raw
materials.
In March 2020, management recorded provisions against inventory,
based on the estimated impact of COVID-19 on the Group. As noted
above, performance since March 2020 has exceeded the estimates made
at the time. Management has updated their assumptions regarding
future performance as part of the current year estimate. This has
resulted in a release of inventory provisions, both relating to
inventory sold during the current year, where this was for a higher
net realisable value than had been assumed, and relating to
assumptions regarding the net realisable value of inventory held at
both 27 March 2021 and 2 April 2022.
Management has also reviewed the remaining inventory, not
covered by the above reassessment, and provisions have been
recorded where appropriate based on future trading
expectations.
Refer to note 16 for further details of the carrying value of
inventory and inventory provisions and for sensitivities relating
to this key source of estimation uncertainty.
Uncertain tax positions
In common with many multinational companies, Burberry faces tax
audits in jurisdictions around the world in relation to transfer
pricing of goods and services between associated entities within
the Group. These tax audits are often subject to inter-government
negotiations. The matters under discussion are often complex and
can take many years to resolve. Tax liabilities are recorded based
on management's estimate of either the most likely amount or the
expected value amount depending on which method is expected to
better reflect the resolution of the uncertainty. Given the
inherent uncertainty in assessing tax outcomes, the Group could, in
future periods, experience adjustments to these tax liabilities
that have a material positive or negative effect on the Group's
results for a particular period.
Refer to note 8 for further details of management estimates
surrounding the outcome of all matters under dispute or negotiation
between governments in relation to current tax liabilities
recognised at 2 April 2022, and for sensitivities relating to this
key source of estimation uncertainty.
Key judgements in applying the Group's accounting policies
Judgements are those decisions made when applying accounting
policies which have a significant impact on the amounts recognised
in the Group financial statements. Further details of the Group's
accounting policies are provided in note 2. Key judgements that
have a significant impact on the amounts recognised in the Group
financial statements for the 53 weeks to 2 April 2022 and the 52
weeks to 27 March 2021 are as follows:
Where the Group is a lessee, judgement is required in
determining the lease term at initial recognition where extension
or termination options exist. In such instances, all facts and
circumstances that may create an economic incentive to exercise an
extension option, or not exercise a termination option, have been
considered to determine the lease term. Considerations include, but
are not limited to, the period assessed by management when
approving initial investment, together with costs associated with
any termination options or extension options. Extension periods (or
periods after termination options) are only included in the lease
term if the lease is reasonably certain to be extended (or not
terminated). Where the lease term has been extended by assuming an
extension option will be recognised, this will result in the
initial right-of-use assets and lease liabilities at inception of
the lease being greater than if the option was not assumed to be
exercised. Likewise, assuming a break option will be exercised will
reduce the initial right-of-use assets and lease liabilities.
Refer to note 19 for further details surrounding the judgements
regarding the impact of breaks and options on lease
liabilities.
2. Accounting policies
The principal accounting policies of the Group are:
a) Revenue
The Group obtains revenue from contracts relating to sales of
luxury goods to retail and wholesale customers. Retail purchases
are paid at time of purchase while wholesale and licensing
purchases are paid on short-term credit terms. The Group also
obtains revenue through licences issued to third parties to produce
and sell goods carrying 'Burberry' trademarks. Revenue is stated
excluding Value Added Tax and other sales related taxes.
Retail and wholesale revenue
For retail and wholesale revenue, the primary performance
obligation is the transfer of luxury goods to the customer. For
retail revenue this is considered to occur when control of the
goods passes to the customer. For in-store retail revenue, control
transfers when the customer takes possession of the goods in store
and pays for the goods. For digital retail revenue, control is
considered to transfer when the goods are delivered to the
customer. The timing of transfer of control of the goods in
wholesale transactions depends upon the terms of trade in the
contract. Principally for wholesale revenue, revenue is recognised
either when goods are collected by the customer from the Group's
premises, or when the Group has delivered the goods to the location
specified in the contract. Provision for returns and other
allowances are reflected in revenue when revenue from the customer
is first recognised. Retail customers typically have the right to
return product within a limited time frame while wholesale
customers typically have the right to return damaged products.
Returns are initially estimated based on historical levels and
adjusted subsequently as returns are incurred.
Some wholesale contracts may require the Group to make payments
to the wholesale customer, for services directly relating to the
sale of the Group's goods, such as the cost of staff handling the
Group's goods at the wholesaler. Payments to the customer directly
relating to the sale of goods to the customer are recognised as a
reduction in revenue, unless in exchange for a distinct good or
service. These charges are recognised in revenue at the later of
when the sale of the related goods to the customer is recognised or
when the customer is paid, or promised to be paid, for the service.
Payments to the customer relating to a service which is distinct
from the sale of goods to the customer are recognised in operating
costs.
The Group sells gift cards and similar products to customers,
which can be redeemed for goods, up to the value of the card, at a
future date. Revenue relating to gift cards is recognised when the
card is redeemed, up to the value of the redemption. Unredeemed
amounts on gift cards are classified as contract liabilities.
Typically, the Group does not expect to have significant unredeemed
amounts arising on its gift cards.
Licensing revenue
The Group's licences entitle the licensee to access the Group's
trademarks over the term of the licence. Hence revenue from
licensing is recognised over the term of access to the licence.
Royalties receivable under licence agreements are usually based on
production or sales volumes and are accrued in revenue as the
subsequent production or sale occurs. Any amounts received which
have not been recognised in revenue are classified as contract
liabilities.
b) Segment reporting
As required by IFRS 8 Operating Segments, the segmental
information presented in the financial statements is reported in a
manner consistent with the internal reporting provided to the Chief
Operating Decision Maker. The Chief Operating Decision Maker, who
is responsible for allocating resources and assessing performance,
has been identified as the Board of Directors.
The Group has centralised activities for designing, making and
sourcing, which ensure a global product offering is sold through
retail and wholesale channels worldwide. Resource allocation and
performance is assessed across the whole of the retail/wholesale
channel globally. Hence the retail/wholesale channel has been
determined to be an operating segment.
Licensed products are manufactured and sold by third-party
licensees. As a result, this channel is assessed discretely by the
Chief Operating Decision Maker and has been determined to be an
operating segment.
The Group presents an analysis of its revenue by channel, by
product division and by geographical destination.
c) Business combinations
The acquisition method of accounting is used to account for the
acquisition of subsidiaries by the Group. The cost of an
acquisition is measured as the fair value of the assets given,
equity instruments issued and liabilities incurred or assumed at
the date of exchange. Contingent payments are remeasured at fair
value through the Income Statement. All transaction costs are
expensed to the Income Statement. Identifiable assets acquired and
liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the
acquisition date, irrespective of the extent of any non-controlling
interest. Non-controlling interests in subsidiaries are identified
separately from the Group's equity, and are initially measured
either at fair value or at a value equal to the non-controlling
interests' share of the identifiable net assets acquired. The
choice of the basis of measurement is an accounting policy choice
for each individual business combination. The excess of the cost of
acquisition together with the value of any non-controlling interest
over the fair value of the identifiable net assets acquired is
recorded as goodwill. If the cost of acquisition is less than the
fair value of the net assets of the subsidiary acquired, the
difference is recognised directly in the Income Statement.
d) Share schemes
The Group operates a number of equity-settled share-based
compensation schemes, under which services are received from
employees (including executive directors) as consideration for
equity instruments of the Company. The cost of the share-based
incentives is measured with reference to the fair value of the
equity instruments awarded at the date of grant, including share
awards and options. Appropriate option pricing models, including
Black-Scholes, are used to determine the fair value of the option
awards made. The fair value takes into account the impact of any
market performance conditions, but the impact of non-market
performance conditions is not considered in determining the fair
value on the date of grant. Vesting conditions which relate to
non-market conditions are allowed for in the assumptions used for
the number of share awards or options expected to vest. The
estimate of the number of share awards or options expected to vest
is revised at each balance sheet date.
In some circumstances, employees may provide services in advance
of the grant date. The grant date fair value is estimated for the
purposes of recognising the expense during the period between the
service commencement period and the grant date.
The cost of the share-based incentives is recognised as an
expense over the vesting period of the share awards, or options,
with a corresponding increase in equity.
When share awards or options are exercised, they are settled
either via issue of new shares in the Company, or through shares
held in an Employee Share Option Plan (ESOP) trust, depending on
the terms and conditions of the relevant scheme. The proceeds
received from the exercises, net of any directly attributable
transaction costs, are credited to share capital and share premium
accounts.
e) Leases
The Group is both a lessee and lessor of property, plant and
equipment. A contract is, or contains, a lease if the contract
conveys the right to control the use of an identified asset for a
period of time in exchange for consideration. An identified asset
may be specifically or implicitly specified. Control exists when
the lessee has both the right to direct the use of the identified
asset and the right to obtain substantially all of the economic
benefits from that use.
Lessee accounting
The Group's principal lease arrangements where the Group acts as
the lessee are for property, most notably the lease of retail
stores, corporate offices and warehouses. Other leases are for
office equipment, vehicles, and supply chain equipment. Lease terms
are negotiated on an individual basis and contain a wide range of
different terms and conditions.
The Group recognises all lease liabilities and the corresponding
right-of-use assets on the Balance Sheet, with the exception of
certain short-term leases (12 months or less) and leases of low
value assets, which are expensed as incurred. Leases and the
corresponding right-of-use assets are initially recognised when the
Group obtains control of the underlying asset. Leases for new
assets are presented as additions to lease liabilities and
right-of-use assets.
Lease liabilities are initially measured on a present value
basis. Lease liabilities include the net present value of the
following lease payments:
-- Fixed payments, less any incentives
-- Variable lease payments that are based on a future index or rate
-- Amounts expected to be payable by the lessee under residual value guarantees and
-- The cost of exercising a purchase option if the lessee is reasonably certain to exercise that option
Where the lease contains an extension option or a termination
option which is exercisable by the Group, as lessee, an assessment
is made as to whether the Group is reasonably certain to exercise
the extension option, or not exercise the termination option,
considering all relevant facts and circumstances that create an
economic incentive. Considerations may include the contractual
terms and conditions for the optional periods compared to market
rates, costs associated with the termination of the lease and the
importance of the underlying asset to the Group's operations.
Variable lease payments dependent upon a future index or rate
are measured using the amounts payable at the commencement date
until the index or rate is known. Variable lease payments not
dependent on an index or rate, including lease payments based on a
percentage of turnover, are excluded from the calculation of lease
liabilities.
Payments are discounted at the incremental borrowing rate of the
lessee, unless the interest rate implicit in the lease can be
readily determined.
Right-of-use assets are classified as property or non-property.
The Group has elected not to apply the short-term exemption to the
property class of right-of-use assets. Where the exemption is
applied to the non-property class of right-of-use assets, lease
payments are expensed as incurred. The low value asset exemption
has been applied to both the property and non-property class of
assets on a lease-by-lease basis where applicable.
In circumstances where the Group is in possession of a property
but there is no executed agreement or other binding obligation in
relation to the property, rent is expensed until such time the
obligation becomes binding, at which point, a right-of-use asset
and lease liability will be recognised prospectively. These lease
costs are disclosed as lease in holdover expenses. Refer to notes 5
and 19.
Right-of-use assets are measured at cost comprising the
following:
-- The amount of the initial measurement of the lease liability
-- Any lease payments made at or before the commencement date
less any lease incentives received and
-- Any initial direct costs incurred in entering into the lease
The Group recognises depreciation of right-of-use assets and
interest on lease liabilities in the Income Statement over the
lease term. Repayments of lease liabilities are classified
separately in the Statement of Cash Flows where the cash payments
for the principal portion of the lease liability are presented
within financing activities, and cash payments for the interest
portion are presented within operating activities. Payments in
relation to short-term leases and leases of low value assets which
are not included on the Balance Sheet are included within operating
activities.
Modifications to lease agreements, extensions to existing lease
agreements and changes to future lease payments relating to
existing terms in the contract, including market rent reassessments
and index based changes, are presented as remeasurements of the
lease liabilities. The related right-of-use asset is also
remeasured. If the modification results in a reduction in scope of
the lease, either through shortening the lease term or through
disposing of part of the underlying asset, a gain or loss on
disposal may arise relating to the difference between the lease
liabilities and the right-of-use asset applicable to the reduction
in scope.
Right-of-use assets are included in the review for impairment of
property, plant and equipment and intangible assets with finite
economic lives, if there is an indication that the carrying amount
of the cash generating unit may not be recoverable.
Lessor accounting
The Group also acts as a lessor of properties. Each of these
leases are classified as either a finance lease or an operating
lease. Leases in which substantially all of the risks and rewards
incidental to ownership of an underlying asset are transferred to
the lessee by the lessor are classified as finance leases. Leases
which are not finance leases are classified as operating
leases.
Gross rental income in respect of operating leases is recognised
on a straight-line basis over the term of the leases.
f) Dividend distributions
Dividend distributions to Burberry Group plc's shareholders are
recognised as a liability in the period in which the dividend
becomes a committed obligation. Final dividends are recognised when
they are approved by the shareholders. Interim dividends are
recognised when paid.
g) Pension costs
Eligible employees participate in defined contribution pension
schemes, the principal one being in the UK with its assets held in
an independently administered fund. The cost of providing these
benefits to participating employees is recognised in the Income
Statement as they fall due and comprises the amount of
contributions to the schemes.
h) Intangible assets
Goodwill
Goodwill is the excess of the cost of acquisition together with
the value of any non-controlling interest, over the fair value of
identifiable net assets acquired. Goodwill on acquisition is
recorded as an intangible asset. Fair values are attributed to the
identifiable assets, liabilities and contingent liabilities that
existed at the date of acquisition, reflecting their condition at
that date. Adjustments are also made to align the accounting
policies of acquired businesses with those of the Group.
Goodwill is assigned an indefinite useful life. Impairment
reviews are performed annually, or more frequently if events or
changes in circumstances indicate that the carrying value may not
be recoverable. Impairment losses recognised on goodwill are not
reversed in future periods.
Trademarks, licences and other intangible assets
The cost of securing and renewing trademarks and licences, and
the cost of acquiring other intangible assets, is capitalised at
purchase price and amortised by equal annual instalments over the
period in which benefits are expected to accrue, typically ten
years for trademarks, or the term of the licence. The useful life
of trademarks and other intangible assets is determined on a
case-by-case basis, in accordance with the terms of the underlying
agreement and the nature of the asset.
Computer software
Computer software costs are capitalised during the development
phase at the point at which there is sufficient certainty that it
will deliver future economic benefits to the Group. The cost of
acquiring computer software (including licences and separately
identifiable development costs) is capitalised as an intangible
asset at purchase price, plus any directly attributable cost of
preparing that asset for its intended use. Software costs are
amortised on a straight-line basis over their estimated useful
lives, which may be up to seven years.
i) Property, plant and equipment
Property, plant and equipment, with the exception of assets in
the course of construction, is stated at cost or deemed cost, based
on historical revalued amounts prior to the adoption of IFRS, less
accumulated depreciation and provision to reflect any impairment in
value. Assets in the course of construction are stated at cost less
any provision for impairment and transferred to completed assets
when substantially all of the activities necessary for the asset to
be ready for use have occurred. Cost includes the original purchase
price of the asset and costs attributable to bringing the asset to
its working condition for its intended use.
Depreciation
Depreciation of property, plant and equipment is calculated to
write off the cost or deemed cost, less residual value, of the
assets in equal annual instalments over their estimated useful
lives at the following rates:
Category of property, plant
Type of asset and equipment Useful life
Land Freehold land and buildings Not depreciated
Freehold buildings Freehold land and buildings Up to 50 years
Long life leasehold Over the unexpired
improvements Leasehold improvements term of the lease
Short life leasehold
improvements Leasehold improvements Up to 10 years
Fixtures, fittings and
Plant and machinery equipment Up to 15 years
Retail fixtures and Fixtures, fittings and
fittings equipment Up to 5 years
Office fixtures and Fixtures, fittings and
fittings equipment Up to 5 years
Fixtures, fittings and
Computer equipment equipment Up to 7 years
Assets in the course Assets in the course of
of construction construction Not depreciated
Profit/loss on disposal of property, plant and equipment and
intangible assets
Profits and losses on the disposal of property, plant and
equipment and intangible assets represent the difference between
the net proceeds and net book value at the date of sale. Disposals
are accounted for when the relevant transaction becomes
unconditional.
j) Discontinued operations and assets held for sale
Non-current assets are classified as held for sale when their
carrying amount is to be recovered principally through a sale
transaction rather than through continued use, and a sale within
the next 12 months is considered to be highly probable. Assets
classified as held for sale cease to be depreciated and they are
stated at the lower of carrying amount and fair value less cost to
sell.
k) Impairment of non-financial assets
Assets that have an indefinite useful life are not subject to
amortisation and are tested annually for impairment. Assets under
construction are also tested annually. Assets that are subject to
amortisation or depreciation are reviewed for impairment whenever
events or changes in circumstance indicate that the carrying value
may not be recoverable. An impairment loss is recognised for the
amount by which the carrying value exceeds its recoverable amount.
The recoverable amount is the higher of an asset's fair value less
costs to sell and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there
are separately identifiable cash flows being individual stores
(cash generating units). Non-financial assets, other than goodwill,
for which an impairment has been previously recognised are reviewed
for possible reversal of impairment at each reporting date.
l) Inventories
Inventories are stated at the lower of cost and net realisable
value. Cost consists of all costs of purchase, costs of conversion,
design costs and other costs incurred in bringing the inventories
to their first point of sale location and condition. The cost of
inventories is determined using a first-in, first-out (FIFO)
method, taking account of the fashion seasons for which the
inventory was offered. Where necessary, provision is made to reduce
cost to no more than net realisable value having regard to the
nature and condition of inventory, as well as its anticipated
utilisation and saleability.
m) Taxation
Tax expense represents the sum of the tax currently payable and
deferred tax charge.
The tax currently payable is based on taxable profit for the
year. Taxable profit differs from net profit as reported in the
Income Statement because it excludes items of income or expense
which are taxable or deductible in other years and it further
excludes items which are never taxable or deductible. The Group's
liability for current tax is calculated using tax rates which have
been enacted or substantively enacted at the balance sheet
date.
Deferred tax is recognised, using the liabilities method, on
temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated
financial statements. However, if the temporary difference arises
from initial recognition of an asset or liability in a transaction
other than a business combination that at the time of the
transaction affects neither accounting nor taxable profit or loss,
no deferred tax will be recognised. Deferred tax is determined
using tax rates (and laws) that have been enacted or substantively
enacted at the balance sheet date and are expected to apply when
the related deferred tax asset is realised or the deferred tax
liability is settled.
Deferred tax assets are recognised to the extent that it is
probable that future taxable profits will be available against
which the temporary differences can be utilised.
Deferred tax is provided on temporary differences arising on
investments in subsidiaries, except where the timing of the
reversal of the temporary difference is controlled by the Group and
it is probable that the temporary difference will not reverse in
the foreseeable future.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to offset current tax assets against
current tax liabilities and when deferred tax assets and
liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entities or different taxable
entities where there is an intention to settle the balances on a
net basis.
n) Provisions
Provisions are recognised when there is a present legal or
constructive obligation as a result of past events, for which it is
probable that an outflow of economic benefits will be required to
settle the obligation, and where the amount of the obligation can
be reliably estimated. When the effect of the time value of money
is material, provision amounts are calculated based on the present
value of the expenditures expected to be required to settle the
obligation. The present value is calculated using forward market
interest rates as measured at the balance sheet reporting date,
which have been adjusted for risks specific to the future
obligation.
Property obligations
A provision for the present value of future property
reinstatement costs is recognised where there is an obligation to
return the leased property to its original condition at the end of
a lease term. The reinstatement cost at the end of a lease usually
arises due to leasehold improvements and modifications carried out
by the Group in order to customise the property during tenure of
the lease. As a result, the cost of the reinstatement provision is
recognised as a component of the cost of the leasehold improvements
in property, plant and equipment when these are installed.
o) Share capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.
Where any Group company purchases the Company's equity share
capital (treasury shares), the consideration paid, including any
directly attributable incremental costs, is deducted from equity
attributable to owners of the Company until the shares are
cancelled, reissued or disposed of. Where such shares are
subsequently sold or reissued, any consideration received, net of
any directly attributable incremental transaction costs and the
related income tax effects, is included in equity attributable to
owners of the Company.
p) Financial instruments
Financial instruments are initially recognised at fair value
plus directly attributable transaction costs on the Balance Sheet
when the entity becomes a party to the contractual provisions of
the instrument. A financial asset is derecognised when the
contractual rights to the cash flow expire or substantially all
risks and rewards of the asset are transferred. A financial
liability is derecognised when the obligation specified in the
contract is discharged, cancelled or expired.
At initial recognition, all financial liabilities are stated at
fair value. Subsequent to initial recognition, all financial
liabilities are stated at amortised cost using the effective
interest rate method except for derivatives which are held at fair
value and which are classified as fair value through profit and
loss, except where they qualify for hedge accounting. Financial
assets are classified as either amortised cost or fair value
through profit and loss depending on their cash flow
characteristics. Assets with cash flows that represent solely
payments of principal and interest are measured at amortised cost.
The fair value of the Group's financial assets and liabilities held
at amortised cost mostly approximate their carrying amount due to
the short maturity of these instruments. Where the fair value of
any financial asset or liability held at amortised cost is
materially different to the book value, the fair value is
disclosed.
The Group classifies its instruments in the following
categories:
Fair value
Financial instrument measurement
category Note Classification Measurement hierarchy(2)
Cash and cash 17 Amortised cost Amortised cost N/A
equivalents
Cash and cash Fair value through Fair value through
equivalents 17 profit and loss profit and loss 2
Trade and other 15 Amortised cost Amortised cost N/A
receivables
Trade and other Fair value through Fair value through
receivables 15 profit and loss profit and loss 2
Trade and other 18 Other financial liabilities Amortised cost N/A
payables
Borrowings 22 Other financial liabilities Amortised cost N/A
Leases 19 Lease liabilities Amortised cost N/A
Fair value through Fair value through
Deferred consideration 18 profit and loss profit and loss 3
Forward foreign Fair value through Fair value through
exchange contracts profit and loss profit and loss 2
Forward foreign
exchange contracts Fair value - hedging Fair value - hedging
used for hedging(1) instrument instrument(3) 2
Fair value through Fair value through
Equity swap contracts profit and loss profit and loss 2
1. Cash flow hedge and net investment hedge accounting is
applied to the extent it is achievable.
2. The fair value measurement hierarchy is only applicable for
financial instruments measured at fair value.
3. Forward foreign exchange contracts used for hedging are
classified as Fair value - hedging instruments under IFRS 9,
however IAS 39 hedge accounting has been applied.
The measurements for financial instruments carried at fair value
are categorised into different levels in the fair value hierarchy
based on the inputs to the valuation technique used. The different
levels are defined as follows:
Level 1: quoted prices (unadjusted) in active markets for
identical assets or liabilities that the Group can access at the
measurement date.
Level 2: inputs other than quoted prices included within Level 1
that are observable for the asset or liability, either directly or
indirectly.
Level 3: includes unobservable inputs for the asset or
liability.
Observable inputs are those which are developed using market
data, such as publicly available information about actual events or
transactions. The Group has an established framework with respect
to measurement of fair values, including Level 3 fair values. The
Group regularly reviews any significant inputs which are not
derived from observable market data and considers, where available,
relevant third-party information, to support the conclusion that
such valuations meet the requirements of IFRS. The classification
level in the fair value hierarchy is also considered periodically.
Significant valuation issues are reported to the Audit
Committee.
The fair value of those cash and cash equivalents measured at
fair value through profit and loss, principally money market funds,
is derived from their net asset value which is based on the value
of the portfolio investment holdings at the balance sheet date.
This is considered to be a Level 2 measurement.
The fair value of forward foreign exchange contracts, equity
swap contracts and trade and other receivables, principally cash
settled equity swaps, is based on a comparison of the contractual
and market rates and, in the case of forward foreign exchange
contracts, after discounting using the appropriate yield curve as
at the balance sheet date. All Level 2 fair value measurements are
calculated using inputs which are based on observable market
data.
The fair value of the contingent payment component of deferred
consideration is considered to be a Level 3 measurement and is
derived using a present value calculation, incorporating observable
and non-observable inputs. This valuation technique has been
adopted as it most closely mirrors the contractual arrangement.
The Group's primary categories of financial instruments are
listed below:
Cash and cash equivalents
Cash and short-term deposits on the Balance Sheet comprise cash
at banks and on hand and short-term highly liquid deposits with a
maturity of three months or less, that are readily convertible to a
known amount of cash and subject to an insignificant risk of
changes in value. In the Statement of Cash Flows, cash and cash
equivalents also include bank overdrafts, which are recorded under
current liabilities on the Balance Sheet.
While cash at bank and in hand is classified as amortised cost,
some short-term deposits are classified as fair value through
profit and loss.
Cash and cash equivalents held at amortised cost are subject to
impairment testing each period end.
Trade and other receivables
Trade and other receivables are included in current assets,
except for maturities greater than 12 months after the balance
sheet date. Most receivables are held with the objective to collect
the contractual cash flows and are therefore recognised initially
at fair value and subsequently measured at amortised cost using the
effective interest rate method, less provision for impairment. A
provision for the expected credit losses on trade receivables is
established at inception. This is modified when there is a change
in the credit risk. The amount of the movement in the provision is
recognised in the Income Statement.
Cash settled equity swaps are classified as fair value through
profit and loss.
Trade and other payables
Trade and other payables are included in current liabilities,
except for maturities greater than 12 months after the balance
sheet date. Payables are recognised initially at fair value and
subsequently measured at amortised cost using the effective
interest rate method.
Borrowings (including overdrafts)
Borrowings are recognised initially at fair value, inclusive of
transaction costs incurred. Borrowings are subsequently stated at
amortised cost and the difference between the proceeds (net of
transaction costs) and the redemption value is recognised in the
Income Statement over the period of the borrowings using the
effective interest rate method. Borrowings are classified as
current liabilities unless the Group has an unconditional right to
defer settlement of the liability for at least 12 months after the
balance sheet date.
Deferred consideration
Deferred consideration is initially recognised at the present
value of the expected future payments. It is subsequently
remeasured at fair value at each reporting period with the change
in fair value relating to changes in expected future payments
recorded in the Income Statement as an operating expense or income.
Changes in fair value relating to unwinding of discounting to
present value are recorded as a financing expense.
Derivative instruments
The Group uses derivative financial instruments to hedge its
exposure to fluctuations in foreign exchange rates arising on
certain trading transactions. The principal derivative instruments
used are forward foreign exchange contracts taken out to hedge
highly probable cash flows in relation to future sales, and product
purchases. The Group also may designate forward foreign exchange
contracts or foreign currency borrowings as a net investment hedge
of the assets of overseas subsidiaries.
When hedge accounting is applied, the Group documents at the
inception of the transaction the relationship between the spot
element of the hedging instruments and hedged items, as well as its
risk management objective and strategy for undertaking various
hedge transactions. The Group also documents its assessment, both
at hedge inception and on an ongoing basis, of whether the hedging
instruments that are used in hedging transactions are highly
effective in offsetting changes in fair values or cash flows of
hedged items.
Derivatives are initially recognised at fair value at the trade
date and are subsequently remeasured at their fair value. The
method of recognising the resulting gain or loss depends on whether
the derivative is designated as a hedging instrument, and if so,
the nature of the item being hedged. The Group designates certain
derivatives as either: (1) hedges of the fair value of recognised
assets and liabilities or a firm commitment (fair value hedge); (2)
hedges of highly probable forecast transactions (cash flow hedges);
(3) hedges of net investment of the assets of overseas subsidiaries
(net investment hedges); or (4) classified as fair value through
profit and loss.
The forward elements of the hedging instrument are recognised in
operating expenses.
Changes in the fair value relating to the spot element of
derivatives that are designated and qualify as fair value hedges
are recorded in the Income Statement immediately, together with any
changes in the fair value of the hedged item that is attributable
to the hedged risk.
The effective portion of changes in the fair value relating to
the spot element of derivatives that are designated and qualify as
cash flow hedges is deferred in other comprehensive income. The
gain or loss relating to the ineffective portion of the gain or
loss is recognised immediately in the Income Statement. Amounts
deferred in other comprehensive income are recycled through the
Income Statement in the periods when the hedged item affects the
Income Statement. When a hedging instrument expires or is sold, or
when a hedge no longer meets the criteria for hedge accounting, any
cumulative gain or loss existing in equity at the time remains in
equity and is recognised when the forecast transaction is
ultimately recognised in the Income Statement. When a forecast
transaction is no longer expected to occur, the cumulative gain or
loss that was reported in equity is immediately transferred to the
Income Statement within 'net exchange gain/(loss) on derivatives -
fair value through profit and loss'. If a derivative instrument is
not designated as a hedge, the subsequent change to the fair value
is recognised in the Income Statement within operating expenses or
interest depending upon the nature of the instrument.
Where the Group hedges net investments in foreign operations
through derivative instruments or foreign currency borrowings, the
gains or losses on the effective portion of the change in fair
value of derivatives that are designated and qualify as a hedge of
a net investment, or the gains or losses on the retranslation of
the borrowings are recognised in other comprehensive income and are
reclassified to the Income Statement when the foreign operation
that is hedged is disposed of.
q) Government grants
Government grants related to assets are recognised as deferred
income when there is reasonable certainty that any conditions
attached to the grant will be met and the grant will be received.
They are amortised to operating income over the useful life of the
asset. Government grants related to income are presented as
operating income when it is reasonably certain that any conditions
attached will be met and that the grant will be received.
r) Foreign currency translation
Functional and presentation currency
Items included in the financial statements of each of the
Group's entities are measured using the currency of the primary
economic environment in which the entity operates (the functional
currency). The consolidated financial statements are presented in
sterling which is the Company's functional and the Group's
presentation currency.
Transactions in foreign currencies
Transactions denominated in foreign currencies within each
entity in the Group are translated into the functional currency at
the exchange rate prevailing at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies,
which are held at the year end, are translated into the functional
currency at the exchange rate ruling at the balance sheet date
(closing rate). Exchange differences on monetary items are
recognised in the Income Statement in the period in which they
arise, except where these exchange differences form part of a net
investment in overseas subsidiaries of the Group, in which case
such differences are taken directly to the hedging reserve.
Translation of the results of overseas businesses
The results of overseas subsidiaries are translated into the
Group's presentation currency of sterling each month at the
weighted average exchange rate for the month according to the
phasing of the Group's trading results. The weighted average
exchange rate is used, as it is considered to approximate the
actual exchange rates on the date of the transactions. The assets
and liabilities of such undertakings are translated at the closing
rates. Differences arising on the retranslation of the opening net
investment in subsidiary companies, and on the translation of their
results, are taken directly to the foreign currency translation
reserve.
Goodwill and fair value adjustments arising on the acquisition
of a foreign operation are treated as assets and liabilities of the
foreign operation and translated at the closing rate.
The principal exchange rates used were as follows:
Average rate Closing rate
53 weeks 52 weeks
to to As at As at
2 April 27 March 2 April 27 March
2022 2021 2022 2021
Euro 1.18 1.12 1.19 1.17
US Dollar 1.36 1.30 1.31 1.38
Chinese Yuan Renminbi 8.73 8.85 8.34 9.02
Hong Kong Dollar 10.63 10.08 10.26 10.72
Korean Won 1,596 1,514 1,592 1,558
s) Adjusted profit before taxation
In order to provide additional consideration of the underlying
performance of the Group's ongoing business, the Group's results
include a presentation of Adjusted operating profit and Adjusted
profit before taxation ('adjusted PBT'). Adjusted PBT is defined as
profit before taxation and before adjusting items. Adjusting items
are those items which, in the opinion of the directors, should be
excluded in order to provide a consistent and comparable view of
the performance of the Group's ongoing business. Generally, this
will include those items that are largely one-off and material in
nature as well as income or expenses relating to acquisitions or
disposals of businesses or other transactions of a similar nature,
including the impact of changes in fair value of expected future
payments or receipts relating to these transactions. Adjusting
items are identified and presented on a consistent basis each year
and a reconciliation of adjusted PBT to profit before tax is
included in the financial statements. Adjusting items and their
related tax impacts, as well as adjusting taxation items, are added
back to/deducted from profit attributable to owners of the Company
to arrive at adjusted earnings per share. Refer to note 6 for
further details of adjusting items.
3. Segmental analysis
The Chief Operating Decision Maker has been identified as the
Board of Directors. The Board reviews the Group's internal
reporting in order to assess performance and allocate resources.
Management has determined the operating segments based on the
reports used by the Board. The Board considers the Group's business
through its two channels to market, being retail/wholesale and
licensing.
Retail/wholesale revenues are generated by the sale of luxury
goods through Burberry mainline stores, concessions, outlets and
digital commerce as well as Burberry franchisees, prestige
department stores globally and multi-brand specialty accounts. The
flow of global product between retail and wholesale channels and
across our regions is monitored and optimised at a corporate level
and implemented via the Group's inventory hubs situated in Europe,
the US, mainland China and Hong Kong, S.A.R. China.
Licensing revenues are generated through the receipt of
royalties from global licensees of beauty products, eyewear and
from licences relating to the use of non-Burberry trademarks in
Japan.
The Board assesses channel performance based on a measure of
adjusted operating profit. This measurement basis excludes the
effects of adjusting items. The measure of earnings for each
operating segment that is reviewed by the Board includes an
allocation of corporate and central costs. Interest income and
charges are not included in the result for each operating segment
that is reviewed by the Board.
Retail/Wholesale Licensing Total
53 weeks 52 weeks 53 weeks 52 weeks 53 weeks 52 weeks
to to to to to to
2 April 27 March 2 April 27 March 2 April 27 March
2022 2021 2022 2021 2022 2021
GBPm GBPm GBPm GBPm GBPm GBPm
Retail 2,273 1,910 - - 2,273 1,910
Wholesale 512 396 - - 512 396
Licensing - - 42 39 42 39
Total segment revenue 2,785 2,306 42 39 2,827 2,345
Inter-segment revenue(1) - - (1) (1) (1) (1)
Revenue from external
customers 2,785 2,306 41 38 2,826 2,344
Depreciation and
amortisation (313) (277) - - (313) (277)
Impairment of intangible
assets - (9) - - - (9)
Net impairment
of property, plant
and equipment(2) (2) (1) - - (2) (1)
Net impairment
of right-of-use
assets(3) (1) - - - (1) -
Other non-cash
items:
Share-based payments (16) (12) - - (16) (12)
Adjusted operating
profit 486 361 37 35 523 396
Adjusting items(4) 19 124
Finance income 3 3
Finance expense (34) (33)
Profit before taxation 511 490
1. Inter-segment transfers or transactions are entered into
under the normal commercial terms and conditions that would be
available to unrelated third parties.
2. Net impairment charge relating to property, plant and
equipment for the 53 weeks to 2 April 2022 is presented excluding a
net reversal of GBP 1 million (last year: reversal of GBP9 million)
relating to charges as a result of the impact of COVID-19. These
have been presented as adjusting items (refer to note 6).
3. Net impairment charge of right-of-use assets for the 53 weeks
to 2 April 2022 is presented excluding a net charge of GBP6 million
(last year: reversal of GBP38 million) relating to charges as a
result of the impact of COVID-19 and a charge of GBP nil (last
year: charge of GBP4 million) relating to restructuring costs,
which have been presented as adjusting items (refer to note 6).
4. Adjusting items relate to the Retail and Wholesale segment.
Refer to note 6 for details of adjusting items.
Retail/Wholesale Licensing Total
53 weeks 52 weeks 53 weeks 52 weeks 53 weeks 52 weeks
to to to to to to
2 April 27 March 2 April 27 March 2 April 27 March
2022 2021 2022 2021 2022 2021
GBPm GBPm GBPm GBPm GBPm GBPm
Additions to non-current
assets 400 234 - - 400 234
Total segment assets 2,099 1,952 6 7 2,105 1,959
Goodwill 109 105
Cash and cash equivalents 1,222 1,261
Taxation 261 177
Total assets per
Balance Sheet 3,697 3,502
Additional revenue analysis
All revenue is derived from contracts with customers. The Group
derives retail and wholesale revenue from contracts with customers
from the transfer of goods and related services at a point in time.
Licensing revenue is derived over the period the licence agreement
gives the customer access to the Group's trademarks.
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Revenue by product division GBPm GBPm
Accessories 1,017 841
Women's 784 653
Men's 807 668
Children's/Other 177 144
Retail/Wholesale 2,785 2,306
Licensing 41 38
Total 2,826 2,344
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Revenue by destination GBPm GBPm
Asia Pacific 1,276 1,203
EMEIA(1) 813 628
Americas 696 475
Retail/Wholesale 2,785 2,306
Licensing 41 38
Total 2,826 2,344
1. EMEIA comprises Europe, Middle East, India and Africa.
Entity-wide disclosures
Revenue derived from external customers in the UK totalled
GBP210 million for the 53 weeks to 2 April 2022 (last year: GBP145
million).
Revenue derived from external customers in foreign countries
totalled GBP2,616 million for the 53 weeks to 2 April 2022 (last
year: GBP2,199 million). This amount includes GBP626 million of
external revenues derived from customers in the US (last year:
GBP408 million) and GBP765 million of external revenues derived
from customers in China (last year: GBP752 million).
The total of non-current assets, other than financial
instruments, and deferred tax assets located in the UK is GBP439
million (last year: GBP477 million). The remaining GBP1,005 million
of non-current assets are located in other countries (last year:
GBP865 million), with GBP263 million located in the US (last year:
GBP223 million) and GBP214 million located in China (last year:
GBP115 million).
4. Net operating expenses
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Operating income (18) (16)
Selling and distribution costs 1,113 943
Administrative expenses 377 317
1,472 1,244
Adjusting operating income 6 (20) (81)
Adjusting operating expenses 6 16 (22)
(4) (103)
Net operating expenses 1,468 1,141
5. Profit before taxation
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Adjusted profit before taxation is stated
after charging/(crediting):
Depreciation of property, plant and equipment
Within cost of sales 2 2
Within selling and distribution costs 68 56
Within administrative expenses 16 13
Depreciation of right-of-use assets
Within selling and distribution costs 171 155
Within administrative expenses 17 17
Amortisation of intangible assets
Within selling and distribution costs 2 2
Within administrative expenses 37 31
Gain on disposal of property, plant and
equipment and intangible assets(1) (3) -
Gain on disposal of right-of-use assets - (1)
Net impairment charge relating to property,
plant and equipment(2) 12 2 1
Net impairment charge relating to right-of-use
assets(3) 13 1 -
Impairment of intangible assets 11 - 9
Employee costs(4) 537 488
Other lease expense
Property lease variable lease expense 19 122 118
Property lease in holdover expense 19 17 15
Non-property short-term lease expense 19 5 5
Net exchange (gain) on revaluation of
monetary assets and liabilities (10) (5)
Net loss on derivatives - fair value through
profit and loss 9 7
Receivables net impairment charge/(reversal)(5) 1 (1)
1. Gain on disposal of property of GBP18m was presented as an
adjusting item last year (refer to note 6).
2. Net impairment charge relating to property, plant and
equipment for the 53 weeks to 2 April 2022 is presented excluding a
net reversal of GBP1 million (last year: reversal of GBP9 million)
relating to charges as a result of the impact of COVID-19. These
have been presented as adjusting items (refer to note 6).
3. Net impairment charge of right-of-use assets for the 53 weeks
to 2 April 2022 is presented excluding a net charge of GBP6 million
(last year: reversal of GBP38 million) relating to charges as a
result of the impact of COVID-19 and a charge of GBPnil (last year:
charge of GBP4 million) relating to restructuring costs, which have
been presented as adjusting items (refer to note 6).
4. Employee costs for the 53 weeks to 2 April 2022 are presented
excluding a charge of GBP10 million (last year: GBP21 million)
arising as a result of the Group's restructuring programmes and a
charge of GBPnil relating to employee profit sharing agreements
(last year GBP4m on the sale of property in France) , which have
been presented as adjusting items (refer to note 6).
5. Receivables net impairment charge for the 53 weeks to 2 April
2022 is presented excluding reversal of GBP1 million (last year:
reversal of GBP5 million) relating to charges as a result of the
impact of COVID-19, which has been presented as an adjusting item
(refer to note 6).
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Adjusting items
Adjusting operating items
Impact of COVID-19:
Impairment charge/(reversal) relating
to retail cash generating units 6 5 (47)
Impairment (reversal) relating to inventory 6 (16) (22)
Impairment (reversal) relating to receivables 6 (1) (5)
COVID-19-related rent concessions 6 (18) (54)
COVID-19 related government grant income 6 (2) (9)
Other adjusting items:
Gain on disposal of property 6 - (18)
Restructuring costs 6 11 30
Revaluation of deferred consideration
liability 6 1 -
Total adjusting operating items (20) (125)
Adjusting financing items
Finance charge on deferred consideration
liability 6 1 1
Total adjusting financing items 1 1
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Analysis of adjusting operating items:
Included in Cost of sales (Impairment
(reversal) relating to inventory) (16) (22)
Included in Operating expenses 4 (4) (103)
Total (20) (125)
6. Adjusting items
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Total adjusting operating items (pre-tax) (20) (125)
Tax charge on adjusting operating items 5 22
Total adjusting operating items (post-tax) (15) (103)
Impact of COVID-19
COVID-19 continued to impact both business operations and
financial markets worldwide. COVID-19 has also had a significant
impact on the financial results of the Group during the current and
previous year.
As at the beginning of the last financial year, the Group had
balances relating to COVID-19 impairment charges that had
previously been charged as adjusting items in prior years, as they
were considered to be material and one-off in nature. GBP246
million COVID-19 impairment charges were recognised at 28 March
2020 . The charges related to impairments of retail cash generating
units (GBP157 million), intangible assets (GBP10 million) and
receivables (GBP11 million) and to inventory provisions (GBP68
million).
At 2 April 2022, these impairments and provisions have been
reviewed and the assumptions updated where appropriate, to reflect
management's latest expectations. The impact of changes in
assumptions has been presented as an update to the adjusting item
charge. Further details regarding the approach applied to measure
these updates are set out below for each of the specific adjusting
items.
Other items, where they are considered one-off in nature and
directly related to the impact of COVID-19, have been presented as
adjusting items. Income recorded in the year following application
of the temporary COVID-19 Related Rent Concession amendment to IFRS
16 has been presented as an adjusting item. This is considered
appropriate given that the amendment to IFRS 16 is only applicable
for a limited period of time and it is explicitly related to
COVID-19. Grant income recorded in the year, relating to government
arrangements worldwide, has also been presented as an adjusting
item, as it is also explicitly related to COVID-19, and the
arrangements are expected to last for a limited period of time. In
aggregate these items give rise to a material amount of income in
the year. Further details of these adjusting items are set out
below.
All other financial impacts of COVID-19 are included in adjusted
operating profit. As a result, additional costs recorded in the
year, including masks, other personal protection equipment, hand
sanitisers, production inefficiencies due to social distancing,
operating costs of retail stores during closure and the cost of
voluntary payment of UK rates, have not been separately presented
as adjusting items. The discrete impact of COVID-19 on these costs
cannot be reliably measured, hence it is considered more
appropriate to include these additional costs in adjusted operating
profit.
Impairment of retail cash generating units
During the 53 weeks to 2 April 2022, the impairment provisions
remaining have been reassessed, using management's latest
expectations, with a charge of GBP5 million recorded (last year:
GBP47 million net reversal). A related tax credit of GBP1 million
(last year: charge of GBP5 million) has also been recognised in the
year. Any charges or reversals which did not arise from the
reassessment of the original impairment adjusting item, had they
arisen, would not have been included in this adjusting item. Refer
to notes 12 and 13 for details of impairment of retail cash
generating units.
Impairment of inventory
During the 53 weeks to 2 April 2022, reversals of inventory
provisions, relating to inventory which had been provided for as an
adjusting item at the previous year end and has either been sold,
or is now expected to be sold, at a higher net realisable value
than had been assumed when the provision had been initially
estimated, of GBP16 million (last year: GBP22 million) have been
recorded and presented as an adjusting item. A related tax charge
of GBP4 million (last year: GBP5 million) has also been recognised
in the year. All other charges and reversals relating to inventory
provisions have been recorded in adjusted operating profit. Refer
to note 16 for details of inventory provisions.
Impairment of receivables
During the 53 weeks to 2 April 2022, the expected credit loss
rates have been reassessed, taking into account the experience of
losses incurred during the year and changes in market conditions at
2 April 2022 compared to the previous year end. As a result of this
reassessment, management has revised the expected credit loss
rates, with a reversal of GBP1 million recorded as an adjusting
item (last year: GBP5 million), resulting from the reduction in
credit loss rate assumption. A related tax charge of GBPnil (last
year: GBP1 million) has also been recognised in the year. All other
charges and reversals relating to impairment of receivables,
arising from changes in the value and aging of the receivables
portfolio, have been included in adjusted operating profit. Refer
to note 15 for details of impairment of receivables.
COVID-19-related rent concessions
Eligible rent forgiveness amounts have been treated as negative
variable lease payments, resulting in a credit of GBP18 million
(last year: GBP54 million) for the 53 weeks to 2 April 2022 being
recorded in net operating expenses. This income has been presented
as an adjusting item, as set out above. A related tax charge of
GBP4 million (last year: GBP10 million) has also been recognised in
the current year.
COVID-19-related grant income
The Group has recorded grant income of GBP2 million (last year:
GBP9 million) within selling and distribution costs in net
operating expenses for the 53 weeks to 2 April 2022, relating to
government support for the retention of employees, as a result of
COVID-19. These grants related to income received from a number of
government arrangements worldwide. None of the income related to UK
based employees. This income has been presented as an adjusting
item, as set out above. A related tax charge of GBP1 million (last
year: GBP2 million) has also been recognised in the current
year.
Other adjusting items
Restructuring costs
Restructuring costs of GBP11 million (last year: GBP30 million)
were incurred in the current year, arising primarily as a result of
the organisational efficiency programme announced in July 2020 that
included the creation of three new business units to enhance
product focus, increase agility and elevate quality and, to further
streamline of office-based functions and facilities. The costs for
the 53 weeks to 2 April 2022 principally relate to redundancies and
consulting costs and are recorded in operating expenses. They are
presented as an adjusting item, in accordance with the Group's
accounting policy, as the anticipated cost of the restructuring
programme is considered material and discrete in nature. A related
tax credit of GBP3 million (last year: GBP6 million) has also been
recognised in the current year.
Items relating to the deferred consideration liability
On 22 April 2016, the Group entered into an agreement to
transfer the economic right of the non-controlling interest in
Burberry Middle East LLC to the Group in exchange for consideration
of contingent payments to be made to the minority shareholder over
the period to 2023.
A charge of GBP1 million in relation to the revaluation of this
balance has been recognised in net operating expenses for the 53
weeks to 2 April 2022 (last year: GBPnil). A financing charge of
GBP1 million in relation to the unwinding of the discount on the
non-current portion of the deferred consideration liability has
also been recognised for the 53 weeks to 2 April 2022 (last year:
GBP1 million). These movements are unrealised.
No tax has been recognised on either of these items, as the
future payments are not considered to be deductible for tax
purposes. These items are presented as adjusting items in
accordance with the Group's accounting policy, as they arise from
changes in the value of the liability for expected future payments
relating to the purchase of a non-controlling interest in the Group
and acquisition of a subsidiary respectively.
Adjusting items relating to prior years
Gain on disposal of property
During the 52 weeks to 27 March 2021, the Group completed the
sale of an owned property in France for cash proceeds of GBP27
million resulting in a net gain on disposal of GBP23 million,
recorded within administrative expenses in net operating expenses.
A profit of GBP18 million was presented as an adjusting item, after
deducting incremental costs of GBP4 million relating to employee
profit sharing agreements. This charge was recognised as an
adjusting item, in accordance with the Group's accounting policy,
as this profit from asset disposal is considered to be material and
one-off in nature. A related tax charge of GBP5 million was also
recognised in the year.
7. Financing
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Note GBPm GBPm
Bank interest income - amortised cost - 1
Other finance income - amortised cost 1 -
Finance income - amortised cost 1 1
Bank interest income - fair value through
profit and loss 2 2
Finance income 3 3
Interest expense on lease liabilities 19 (27) (25)
Interest expense on overdrafts - -
Interest expense on borrowings (4) (5)
Bank charges (2) (1)
Other finance expense (1) (2)
Finance expense (34) (33)
Finance charge on deferred consideration
liability 6 (1) (1)
Net finance expense (32) (31)
8. Taxation
Analysis of charge for the year recognised in the Group Income
Statement:
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Current tax
UK corporation tax
Current tax on income for the 53 weeks to 2 April
2022 at 19% (last year: 19%) 114 48
Double taxation relief (7) (7)
Adjustments in respect of prior years(1) 25 (23)
132 18
Foreign tax
Current tax on income for the year 28 51
Adjustments in respect of prior years(1) (15) 19
Total current tax 145 88
Deferred tax
UK deferred tax
Origination and reversal of temporary differences (3) 23
Impact of changes to tax rates (4) -
Adjustments in respect of prior years(1) 1 9
(6) 32
Foreign deferred tax
Origination and reversal of temporary differences (27) (7)
Impact of changes to tax rates - -
Adjustments in respect of prior years(1) 2 1
Total deferred tax (31) 26
Total tax charge on profit 114 114
1. Adjustments in respect of prior years relate mainly to tax
return adjustments and a net increase in provisions for tax
contingencies and tax accruals.
Analysis of charge for the year recognised in Other
Comprehensive Income and directly in Equity:
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Current tax
Recognised in Other Comprehensive Income
Current tax (credit)/charge on exchange differences
on loans (foreign currency translation reserve) - (2)
Current tax charge on net investment hedges deferred
in Equity (hedging reserve) 1 -
Total current tax recognised in Other Comprehensive
Income 1 (2)
Deferred tax
Recognised in Other Comprehensive Income
Deferred tax credit on net investment hedges deferred
in Equity (hedging reserve) (1) -
Total deferred tax recognised in Other Comprehensive
Income (1) -
Recognised in Equity
Deferred tax (credit)/charge on share options
(retained earnings) - (1)
Total deferred tax recognised directly in Equity - (1)
The tax rate applicable on profit varied from the standard rate
of corporation tax in the UK due to the following factors:
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Profit before taxation 511 490
Tax at 19% (last year: 19%) on profit before taxation 97 93
Rate adjustments relating to overseas profits 3 18
Permanent differences 6 (1)
Tax on dividends not creditable 2 1
Current year tax losses not recognised - -
Prior year temporary differences and tax losses
recognised (3) (3)
Adjustments in respect of prior years 13 6
Adjustments to deferred tax relating to changes
in tax rates (4) -
Total taxation charge 114 114
Total taxation recognised in the Group Income Statement arises
on the following items:
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Tax on adjusted profit before taxation 109 92
Tax on adjusting items 5 22
Total taxation charge 114 114
During the next year it is possible that some or all of the
current disputes are resolved. Management estimates that the
outcome across all matters under dispute or in negotiation between
governments could be in the range of a decrease of GBP20 million to
an increase of GBP20 million relative to the current tax
liabilities recognised at 2 April 2022. This would have an impact
of approximately (4%) to 4% on the Group's effective tax rate.
9. Earnings per share
The calculation of basic earnings per share is based on profit
or loss attributable to owners of the Company for the year divided
by the weighted average number of ordinary shares in issue during
the year. Basic and diluted earnings per share based on adjusted
profit before taxation are also disclosed to indicate the
underlying profitability of the Group.
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Attributable profit for the year before adjusting
items(1) 382 273
Effect of adjusting items(1) (after taxation) 14 103
Attributable profit for the year 396 376
1. Refer to note 6 for details of adjusting items.
The weighted average number of ordinary shares represents the
weighted average number of Burberry Group plc ordinary shares in
issue throughout the year, excluding ordinary shares held in the
Group's ESOP trusts and treasury shares held by the Company or its
subsidiaries.
Diluted earnings per share is based on the weighted average
number of ordinary shares in issue during the year. In addition,
account is taken of any options and awards made under the employee
share incentive schemes, which will have a dilutive effect when
exercised.
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
Millions Millions
Weighted average number of ordinary shares in
issue during the year 402.5 404.1
Dilutive effect of the employee share incentive
schemes 2.3 1.0
Diluted weighted average number of ordinary shares
in issue during the year 404.8 405.1
10. Dividends paid to owners of the Company
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Prior year final dividend paid 42.5p per share
(last year: nil) 172 -
Interim dividend paid 11.6p per share (last year:
nil) 47 -
Total 219 -
A final dividend in respect of the 53 weeks to 2 April 2022 of
35.4p (last year: 42.5p) per share, amounting to GBP140 million,
has been proposed for approval by the shareholders at the Annual
General Meeting subsequent to the balance sheet date. The final
dividend has not been recognised as a liability at the year end and
will be paid on 5 August 2022 to the shareholders on the register
at the close of business on 1 July 2022. The ex-dividend date is 30
June 2022 and the final day for dividend reinvestment plan ('DRIP')
elections is 15 July 2022.
11. Intangible assets
Intangible
Trademarks, assets
licences in the
and other course
intangible Computer of
Goodwill assets software construction Total
Cost GBPm GBPm GBPm GBPm GBPm
As at 28 March 2020 116 13 198 65 392
Effect of foreign exchange
rate changes (5) - (2) - (7)
Additions - 1 25 11 37
Disposals - - (15) - (15)
Reclassifications from assets
in the course of construction - - 31 (31) -
As at 27 March 2021 111 14 237 45 407
Effect of foreign exchange
rate changes 4 - 1 - 5
Additions - - 12 25 37
Disposals - (1) (7) - (8)
Reclassifications from assets
in the course of construction - - 15 (15) -
As at 2 April 2022 115 13 258 55 441
Accumulated amortisation
and impairment
As at 28 March 2020 7 6 121 12 146
Effect of foreign exchange
rate changes (1) - (2) - (3)
Charge for the year - 1 32 - 33
Disposals - - (15) - (15)
Impairment charge on assets - - 1 8 9
As at 27 March 2021 6 7 137 20 170
Effect of foreign exchange
rate changes - - 1 (1) -
Charge for the year - 1 38 - 39
Disposals - (1) (7) - (8)
Impairment charge on assets - - - - -
As at 2 April 2022 6 7 169 19 201
Net book value
As at 2 April 2022 109 6 89 36 240
As at 27 March 2021 105 7 100 25 237
During the 52 weeks to 27 March 2021 an impairment charge of
GBP8 million was recognised in relation to computer software assets
under construction and GBP1 million was recognised in relation to
computer software assets following a review of supply chain
strategy and future software requirements. No such charge was
incurred in the 53 weeks to 2 April 2022.
Impairment testing of goodwill
The carrying value of the goodwill allocated to cash generating
units:
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
China 50 47
Korea 26 26
Retail and Wholesale segment(1) 19 19
Other 14 13
Total 109 105
1. Goodwill which arose on acquisition of Burberry Manifattura
S.R.L. has been allocated to the group of cash generating units
which make up the Group's Retail and Wholesale operating segment
cash generating unit. This reflects the level at which the goodwill
is being monitored by management.
The Group tests goodwill for impairment annually or when there
is an indication that goodwill might be impaired. The recoverable
amount of all cash generating units has been determined on a
value-in-use basis. Value-in-use calculations for each cash
generating unit are based on projected pre-tax discounted cash
flows together with a discounted terminal value. The cash flows
have been discounted at pre-tax rates reflecting the Group's
weighted average cost of capital adjusted for country-specific tax
rates and risks. Where the cash generating unit has a
non-controlling interest which was recognised at a value equal to
its proportionate interest in the net identifiable assets of the
acquired subsidiary at the acquisition date, the carrying amount of
the goodwill has been grossed up, to include the goodwill
attributable to the non-controlling interest, for the purpose of
impairment testing the goodwill attributable to the cash generating
unit. The key assumptions contained in the value-in-use
calculations include the future revenues, the margins achieved and
the discount rates applied.
The value-in-use calculations have been prepared using
management's cost and revenue projections for the next three years
to 29 March 2025 and a longer-term growth rate of 4% to 27 March
2027. A terminal value has been included in the value-in-use
calculation based on the cash flows for the year ending 27 March
2027 incorporating the assumption that growth beyond 27 March 2027
is equivalent to nominal inflation rates, assumed to be 2%, which
are not significant to the assessment.
The value-in-use estimates indicated that the recoverable amount
of the cash generating unit exceeded the carrying value for each of
the cash generating units. As a result, no impairment has been
recognised in respect of the carrying value of goodwill in the
year.
For the material goodwill balances of China, Korea and the
Retail and Wholesale segment, sensitivity analyses have been
performed by management. The sensitivities include applying a 10%
reduction in revenue and gross profit from management's base cash
flow projections, considering the potential outcome from a more
severe long-term impact of COVID-19. Under this scenario, the
estimated recoverable amount of goodwill in China, Korea and the
Retail and Wholesale segment still exceeded the carrying value.
The pre-tax discount rates for China, Korea and the Retail and
Wholesale segment were 13%, 12% and 10% respectively (last year:
China 14%, Korea 12%, and the Retail and Wholesale segment
10%).
The other goodwill balance of GBP14 million (last year: GBP13
million) consists of amounts relating to seven cash generating
units none of which have goodwill balances individually exceeding
GBP7 million as at 2 April 2022 (last year: GBP6 million).
12. Property, plant and equipment
Fixtures, Assets
Freehold fittings in the
land and Leasehold and course
buildings improvements equipment of construction Total
Cost GBPm GBPm GBPm GBPm GBPm
As at 28 March 2020 147 497 373 24 1,041
Effect of foreign exchange
rate changes (12) (30) (22) (1) (65)
Additions - 44 11 15 70
Disposals (6) (27) (45) - (78)
Reclassifications from assets
in the course of construction - 9 12 (21) -
As at 27 March 2021 129 493 329 17 968
Effect of foreign exchange
rate changes 6 17 9 1 33
Additions - 68 23 45 136
Disposals - (37) (18) (2) (57)
Reclassifications from assets
in the course of construction - 9 5 (14) -
Reclassifications to assets
held for sale (19) - - - (19)
As at 2 April 2022 116 550 348 47 1,061
Accumulated depreciation
and impairment
As at 28 March 2020 59 363 323 1 746
Effect of foreign exchange
rate changes (6) (22) (20) - (48)
Charge for the year 4 45 22 - 71
Disposals (2) (27) (45) - (74)
Impairment charge on assets 1 2 - - 3
Impairment reversal on assets - (8) (2) - (10)
As at 27 March 2021 56 353 278 1 688
Effect of foreign exchange
rate changes 3 14 8 - 25
Charge for the year 3 58 25 - 86
Disposals - (37) (18) - (55)
Impairment charge on assets - 1 1 - 2
Impairment reversal on assets - (1) - - (1)
Reclassifications to assets
held for sale (6) - - - (6)
As at 2 April 2022 56 388 294 1 739
Net book value
As at 2 April 2022 60 162 54 46 322
As at 27 March 2021 73 140 51 16 280
During the 53 weeks to 2 April 2022, management carried out a
review of retail cash generating units for any indication of
impairment or reversal of impairments previously recorded. Where
indications of impairment charges or reversals were identified, the
impairment review compared the value-in-use of the cash generating
units to their net book values at 2 April 2022. The pre-tax cash
flow projections used for this review were based on financial plans
of expected revenues and costs of each retail cash generating unit,
approved by management, reflecting their latest plans over the next
three years to 29 March 2025, followed by longer-term growth rates
of mid-single digits and inflation rates appropriate to each
store's location. The pre-tax discount rates used in these
calculations were between 9.9% and 18.4% (last year: between 9.6%
and 14.1%) based on the Group's weighted average cost of capital
adjusted for country-specific borrowing costs, tax rates and risks
for those countries in which a charge or reversal was incurred.
Where indicators of impairment have been identified and the
value-in-use was less than the carrying value of the cash
generating unit, an impairment of property, plant and equipment and
right-of-use asset was recorded. Where the value-in-use was greater
than the net book value, and the cash generating unit had been
previously impaired, the impairment was reversed, to the extent
that could be supported by the value-in use and allowing for any
depreciation that would have been incurred during the period since
the impairment was recorded. The fair value less cost to sell of
the cash generating units was also considered, taking into account
potential alternative uses for property, such as subletting of
leasehold or sale of freehold. A review for any other indicators of
impairment charges or reversals across the retail portfolio was
also carried out.
In the financial statements for the 52 weeks to 27 March 2021 a
net impairment reversal of GBP47 million was recorded, as an
adjusting item within net operating expenses, relating to the
impairment of retail cash generating units as a result of the
impact of COVID-19. This net reversal reflected improved trading
expectations compared to those assumed at 28 March 2020. During the
53 weeks to 2 April 2022, where these impairments, previously
charged as an adjusting item, were reassessed and updated, any
reversal or additional charge was also recorded as an adjusting
item. This resulted in a net impairment charge of GBP5 million,
which has also been presented as an adjusting item in the current
year. A net impairment reversal of GBP1 million was recorded
against property, plant and equipment (last year: net impairment
reversal of GBP9 million) and a charge of GBP6 million was recorded
against right-of-use assets (last year: net impairment reversal of
GBP38 million). Refer to note 13 for further details of
right-of-use assets. Refer to note 6 for details of adjusting
items.
A net charge of GBP3 million (last year: GBPnil) was recorded
within net operating expenses as a result of the annual review of
impairment for all other retail store assets, excluding those
impaired as a result of the impact of COVID-19. A charge of GBP2
million (last year: charge of GBPnil) was recorded against
property, plant and equipment and a net charge of GBP1 million
(last year: charge of GBPnil) was recorded against right-of-use
assets.
The net impairment charge recorded in property, plant and
equipment related to 13 retail cash generating units (last year:
net impairment reversal related to 25 retail cash generating units)
for which the total recoverable amount at the balance sheet date is
GBP7 million (last year: GBP33 million).
Management has considered the potential impact of changes in
assumptions on the impairment recorded against the Group's retail
assets. Given the significant uncertainty regarding the impact of
COVID-19 on the Group's retail operations and on the global
economy, management has considered sensitivities to the impairment
charge as a result of changes to the estimate of future revenues
achieved by the retail stores. The sensitivities applied are an
increase or decrease in revenue of 10% from the estimate used to
determine the impairment charge or reversal. We have also
considered retail cash generating units with no indicators of
impairment but with a significant asset balance. It is estimated
that a 10% decrease/increase in revenue assumptions for the 52
weeks to 01 April 2023, with no change to subsequent forecast
revenue growth rate assumptions, would result in a less than GBP10
million increase / less than GBP10 million decrease in the
impairment charge of retail store assets in the 53 weeks to 2 April
2022.
An impairment charge of GBPnil (last year: GBP1 million) was
recognised in relation to non-retail property, plant and equipment.
Refer to note 6 for details of adjusting items. As a result the
total net impairment charge for property, plant and equipment was
GBP1 million (last year: net impairment reversal of GBP7
million).
As of 2 April 2022 the Group had three freehold properties that
met the criteria to be classified as held for sale. These assets
were required to be recorded at the lower of carrying value or fair
value less any costs to sell. As the fair value less any costs to
sell exceeded the carrying value for each, the related assets and
liabilities were recorded at their carrying value. The sale of
these properties is expected to complete within the next 12
months.
13. Right-of-use assets
Property right-
of-use assets
Net book value GBPm
As at 28 March 2020 834
Effect of foreign exchange rate changes (39)
Additions 127
Remeasurements(1) 34
Depreciation for the year (172)
Impairment charge on assets (15)
Impairment reversal on assets 49
As at 27 March 2021 818
Effect of foreign exchange rate changes 9
Additions 227
Remeasurements(1) 21
Depreciation for the year (188)
Impairment charge on assets (10)
Impairment reversal on assets 3
As at 2 April 2022 880
1. Remeasurements of lease liabilities include COVID-19-related
rent forgiveness of GBP18 million (last year: GBP54 million) which
have been recognised as a credit in the Income Statement at 2 April
2022 (refer to note 19).
As a result of the assessment of retail cash generating units
for impairment, a net impairment charge of GBP7 million (last year:
net impairment reversal of GBP34 million) was recorded for
impairment of right-of-use assets. Refer to note 12 for further
details of impairment assessment of retail cash generating units.
This net impairment charge comprises GBP6 million relating to the
impact of COVID-19 on the value-in-use of retail cash generating
units (last year: GBP38 million reversal) and GBP1 million relating
to other trading impacts was recognised during the year (last year:
GBPnil). The charge relating to COVID-19 has been presented as an
adjusting item (refer to note 6).
The net impairment charge recorded in right-of-use assets
relates to 12 retail cash generating units (last year: net
impairment reversal related to 27 retail cash generating units) for
which the total recoverable amount at the balance sheet date is
GBP26 million (last year: GBP200 million).
In the prior year, an impairment charge of GBP4 million was
recognised in relation to vacant office premises as part of
restructuring costs in adjusting items.
As a result, the net impairment charge for right-of-use assets
was, in total, GBP7 million (last year: net impairment reversal of
GBP34 million).
14. Deferred taxation
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to offset current tax assets against
current tax liabilities and there is an intention to settle on a
net basis, and to the same fiscal authority. The assets and
liabilities presented in the Balance Sheet, after offset, are shown
in the table below:
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Deferred tax assets 175 137
Deferred tax liabilities (1) (1)
Net amount 174 136
53 weeks 52 weeks
to to
2 April 27 March
The movement in the deferred tax account is as 2022 2021
follows: GBPm GBPm
At start of year 136 171
Effect of foreign exchange rate changes 6 (10)
Credited/(charged) to the Income Statement 31 (26)
Credited to Other Comprehensive Income 1 -
Credited to Equity - 1
At end of year 174 136
The movement in the net deferred tax balances during the year is
as follows:
Deferred tax balances
Unrealised
inventory
profit
and other Unused
Capital inventory Share Derivative tax
allowances provisions schemes Instruments losses Leases Other(1) Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
As at 28 March 2020 20 72 2 (1) 5 53 20 171
Effect of foreign exchange
rate changes (2) (5) - - - (1) (2) (10)
(Charged)/credited
to the Income Statement (1) (5) 1 - (4) (17) - (26)
Credited to Equity - - 1 - - - - 1
As at 27 March 2021 17 62 4 (1) 1 35 18 136
Effect of foreign exchange
rate changes - 4 - - - 1 1 6
Credited/(charged)
to the Income Statement 2 31 1 - 2 (4) (1) 31
Credited to Other Comprehensive
Income - - - 1 - - - 1
As at 2 April 2022 19 97 5 - 3 32 18 174
1. Deferred balances within 'Other' category in the analysis
above include temporary differences arising on other provisions and
accruals of GBP18m (last year: GBP18m) and property provisions of
GBPnil (last year: GBPnil).
Deferred tax assets are recognised for tax losses carried
forward to the extent that the realisation of the related benefit
through the future taxable profits is probable. The Group did not
recognise deferred tax assets of GBP47 million (last year: GBP51
million) in respect of losses and temporary timing differences
amounting to GBP185 million (last year: GBP197 million) that can be
set off against future taxable income. There is a time limit for
the recovery of GBP6m of these potential assets (last year: GBP7
million) which ranges from one to seven years (last year: two to
eight years).
Included within other temporary differences above is a deferred
tax liability of GBP1 million (last year: GBP1 million) relating to
unremitted overseas earnings. No deferred tax liability is provided
in respect of any future remittance of earnings of foreign
subsidiaries where the Group is able to control the remittance of
earnings and it is probable that such earnings will not be remitted
in the foreseeable future, or where no liability would arise on the
remittance. The aggregate amount of temporary differences in
respect of unremitted earnings is GBP287 million (last year: GBP288
million).
15. Trade and other receivables
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Non-current
Other financial receivables(1) 42 41
Other non-financial receivables(2) 1 1
Prepayments 2 3
Total non-current trade and other receivables 45 45
Current
Trade receivables 151 155
Provision for expected credit losses (7) (8)
Net trade receivables 144 147
Other financial receivables(1) 36 33
Other non-financial receivables(2) 63 48
Prepayments 32 40
Accrued income 8 9
Total current trade and other receivables 283 277
Total trade and other receivables 328 322
1. Other financial receivables include rental deposits, cash
settled equity swaps and other sundry debtors.
2. Other non-financial receivables relates to indirect taxes,
other taxes and duties and COVID-19 related government grant
receivables.
Included in total trade and other receivables are non-financial
assets of GBP98 million (last year: GBP92 million).
16. Inventories
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Raw materials 12 12
Work in progress 1 1
Finished goods 413 389
Total inventories 426 402
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Total inventories, gross 509 519
Provisions (83) (117)
Total inventories, net 426 402
Inventory provisions of GBP83m (last year: GBP117m) are
recorded, representing 16.3% (last year: 22.5%) of the gross value
of inventory. The provisions reflect management's best estimate of
the net realisable value of inventory, where this is considered to
be lower than the cost of the inventory.
The cost of inventories recognised as an expense and included in
cost of sales amounted to GBP786 million (last year: GBP652
million).
As at 28 March 2020, GBP68 million of the provision was included
in cost of sales as a result of the estimated reduction in net
realisable value of inventory due to COVID-19 and was presented as
an adjusting item. This provision related to the current season and
recent seasons that, under more normal circumstances, would be
expected to sell through with limited loss. In the current year,
GBP14 million of the provision has been utilised (last year: GBP4
million), where inventory previously provided for had been sold
below cost in the current year and is recognised in cost of sales.
An additional GBP16 million has been released upon re-assessment of
the provision (last year: GBP22 million), where inventory
previously provided for has been sold, or is now expected to be
sold, for a higher net realisable value than has been estimated
last year as performance during the current year has exceeded, and
is expected to continue to exceed, the assumptions made at last
year end. This reversal is presented as an adjusting item. Refer to
note 6 for details of adjusting items. All other charges and
reversals relating to inventory provisions have been included in
adjusted operating profit.
Taking into account the significant uncertainty regarding the
outcome of COVID-19 and its impact on retail operations and the
global economy, as well as other factors impacting the net
realisable value of inventory including trading assumptions being
higher or lower than expected, management considers that a
reasonable potential range of outcomes could result in an increase
or decrease in inventory provisions of GBP17 million in the next 12
months. This would result in a potential range of inventory
provisions of 13.1% to 19.8% as a percentage of the gross value of
inventory as at 2 April 2022.
The net movement in inventory provisions included in cost of
sales for the 53 weeks to 2 April 2022 was a release of GBP1
million (last year: release of GBP11 million). The total reversal
of inventory provisions during the current year, which is included
in the net movement, was GBP43 million (last year: reversal of
GBP67 million). Both these amounts include the reversal of GBP16
million (last year: GBP22 million), referred to above, which has
been presented as an adjusting item.
17. Cash and cash equivalents
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Cash and cash equivalents held at amortised cost
Cash at bank and in hand 124 190
Short-term deposits 73 159
197 349
Cash and cash equivalents held at fair value through
profit and loss
Short-term deposits 1,025 912
Total 1,222 1,261
Cash and cash equivalents classified as fair value through
profit and loss relate to deposits held in low volatility net asset
value money market funds. The cash is available immediately and,
since the funds are managed to achieve low volatility, no
significant change in value is anticipated. The funds are monitored
to ensure there are no significant changes in value.
As at 2 April 2022 and 27 March 2021, no impairment losses were
identified on cash and cash equivalents held at amortised cost.
18. Trade and other payables
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Non-current
Other payables(1) 5 8
Deferred income and non-financial accruals 18 14
Contract liabilities 64 70
Deferred consideration(2) 4 7
Total non-current trade and other payables 91 99
Current
Trade payables 181 129
Other taxes and social security costs 60 52
Other payables(1) 6 13
Accruals 204 169
Deferred income and non-financial accruals 13 7
Contract liabilities 13 13
Deferred consideration(2) 4 10
Total current trade and other payables 481 393
Total trade and other payables 572 492
1. Other payables are comprised of COVID-19 rent deferrals,
interest and employee related liabilities.
2. Deferred consideration relates to the acquisition of Burberry
Manifattura S.R.L. on 19 September 2018 and of the economic right
to the non-controlling interest in Burberry Middle East LLC on 22
April 2016. The change in the deferred consideration liability in
the period arises as a result of a financing cash outflow and
non-cash movements. In the 53 weeks to 2 April 2022 payments of
GBP3 million were made in relation to Burberry Middle East LLC
(last year: GBP3 million) and GBP9 million was paid to the previous
owners of Burberry Manifattura S.R.L.
Included in total trade and other payables are non-financial
liabilities of GBP168 million (last year: GBP157 million).
Contract liabilities
Retail contract liabilities relate to unredeemed balances on
issued gift cards and similar products, and advanced payments
received for sales which have not yet been delivered to the
customer. Licensing contract liabilities relate to deferred revenue
arising from the upfront payment for the Beauty licence which is
being recognised in revenue over the term of the licence on a
straight-line basis reflecting access to the trademark over the
licence period to 2032.
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Retail contract liabilities 7 6
Licensing contract liabilities 70 77
Total contract liabilities 77 83
The amount of revenue recognised in the year relating to
contract liabilities at the start of the year is set out in the
following table. All revenue in the year relates to performance
obligations satisfied in the year. All contract liabilities at the
end of the year relate to unsatisfied performance obligations.
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Retail revenue relating to contract liabilities 4 2
Deferred revenue from Beauty licence 7 7
Revenue recognised that was included in contract
liabilities at the start of the year 11 9
19. Lease liabilities
Property lease
liabilities
GBPm
Balance as at 28 March 2020 1,125
Effect of foreign exchange rate changes (53)
Created during the year 125
Amounts paid(1) (177)
Discount unwind 25
Remeasurements(2) (21)
Transfers (4)
Balance as at 27 March 2021 1,020
Effect of foreign exchange rate changes 16
Created during the year 222
Amounts paid(1) (229)
Discount unwind 27
Remeasurements(2) 2
Balance as at 2 April 2022 1,058
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Analysis of total lease liabilities:
Non-current 849 810
Current 209 210
Total 1,058 1,020
1. The amounts paid of GBP229 million (last year: GBP177
million) includes GBP202 million (last year: GBP151 million)
arising as a result of a financing cash outflow and GBP27 million
(last year: GBP25 million) arising as a result of an operating cash
outflow.
2. Remeasurements include COVID-19-related rent forgiveness of
GBP16 million (last year: GBP54 million) and other remeasurements
of GBP20 million (last year: GBP33 million). COVID-19-related rent
forgiveness has been recognised as a credit in the Income Statement
at 2 April 2022. This credit is included as an adjusting item.
Refer to note 6. Other remeasurements relate to changes in the
lease liabilities that arises as a result of management's
reassessment of the lease term, based on existing break or
extension options in the contract.
The Group enters into property leases for retail properties,
including stores, concessions, warehouse and storage locations and
office property. The remaining lease terms for these properties
range from a few months to 16 years (last year: few months to 17
years). Many of the leases include break options and/or extension
options to provide operational flexibility. Some of the leases for
concessions have rolling lease terms or rolling break options.
Management assesses the lease term at inception based on the facts
and circumstances applicable to each property including the period
over which the investment appraisal was initially considered.
Potential future undiscounted lease payments related to periods
following the exercise date of an extension or break option not
included in the lease term, and therefore not included in lease
liabilities, are approximately GBP423 million (last year: GBP425
million) in relation to the next available extension option which
are assessed as not reasonably certain to be exercised and GBP157
million (last year: GBP125 million) in relation to break options
which are expected to be exercised. During the 53 weeks to 2 April
2022, significant judgements regarding breaks and options in
relation to individually material leases resulted in approximately
GBP35 million in undiscounted future cash flows not being included
in the initial right-of-use assets and lease liabilities.
Management reviews the retail lease portfolio on an ongoing
basis, taking into account retail performance and future trading
expectations. Management may exercise extension options, negotiate
lease extensions or modifications. In other instances, management
may exercise break options, negotiate lease reductions or decide
not to negotiate a lease extension at the end of the lease term.
The most significant factor impacting future lease payments is
changes management choose to make to the store portfolio.
Future increases and decreases in rent linked to an inflation
index or rate review are not included in the lease liability until
the change in cash flows takes effect. Approximately 20% (last
year: 20%) of the Group's lease liabilities are subject to
inflation linked reviews and 33% (last year: 37%) are subject to
rent reviews. Rental changes linked to inflation or rent reviews
typically occur on an annual basis.
Many of the retail property leases also incur payments based on
a percentage of revenue achieved at the location. Changes in future
variable lease payments will typically reflect changes in the
Group's retail revenues, including the impact of regional mix.
The Group also enters into non-property leases for equipment,
advertising fixtures and machinery. Generally, these leases do not
include break or extension options. The most significant impact to
future cash flows relating to leased equipment, which are primarily
short-term, would be the Group's usage of leased equipment to a
greater or lesser extent.
The Group's accounting policy for leases is set out in note 2.
Details of income statement charges and income from leases are set
out in note 5. The right-of-use asset categories on which
depreciation is incurred are presented in note 13. Interest expense
incurred on lease liabilities is presented in note 7.
Total cash outflows in relation to leases in the 53 weeks ended
2 April 2022 are GBP376 million (last year: GBP312 million). This
relates to payments of GBP202 million on lease principal (last
year: GBP152 million), GBP27 million on lease interest (last year:
GBP25 million), GBP124 million on variable lease payments (last
year: GBP115 million), and GBP23 million other lease payments
principally relating to short-term leases and leases in holdover
(last year: GBP20 million).
20. Provisions for other liabilities and charges
Property
obligations Other Total
GBPm GBPm GBPm
Balance as at 28 March 2020 36 6 42
Effect of foreign exchange rate changes (2) - (2)
Created during the year 9 11 20
Discount unwind 1 - 1
Utilised during the year (1) (1) (2)
Released during the year (1) (2) (3)
Balance as at 27 March 2021 42 14 56
Effect of foreign exchange rate changes 1 - 1
Created during the year 9 8 17
Discount unwind 1 - 1
Utilised during the year (3) (2) (5)
Released during the year (1) (5) (6)
Balance as at 2 April 2022 49 15 64
The net charge in the year for property obligations is GBP8
million (last year: GBP8 million), relating to additional property
reinstatements costs. The net charge in the year for other
provisions of GBP3 million (last year: GBP9 million) relates to
expected future outflows for property disputes, employee matters
and tax compliance.
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Analysis of total provisions:
Non-current 36 32
Current 28 24
Total 64 56
The non-current provisions relate to property reinstatement
costs which are expected to be utilised within 16 years (last year:
17 years).
21. Bank overdrafts
Included within bank overdrafts is GBP45 million (last year:
GBP45 million) representing balances on cash pooling arrangements
in the Group.
The Group has a number of committed and uncommitted arrangements
agreed with third parties. At 2 April 2022, the Group held bank
overdrafts of GBPnil (last year: GBPnil) excluding balances on cash
pooling arrangements.
The fair value of overdrafts approximate the carrying amount
because of the short maturity of these instruments.
22. Borrowings
On 21 September 2020, Burberry Group plc issued medium term
notes with a face value of GBP300 million and 1.125% coupon
maturing on 21 September 2025 (the sustainability bond). Proceeds
from the sustainability bond will allow the Group to finance
projects which support the Group's sustainability agenda. There are
no financial penalties for not using the proceeds as anticipated.
Interest on the sustainability bond is payable semi-annually. The
fair value of the bond at 2 April 2022 is GBP298m (last year:
GBP297m), all movements on the bond are non-cash.
On 26 July 2021, the Group entered into a new GBP300 million
multi-currency sustainability linked revolving credit facility
(RCF) with a syndicate of banks, replacing the previous GBP300
million RCF that had been in place since 2014. In March 2020, the
Group drew down on the RCF in full, and it was repaid in full in
June 2020. There were no drawdowns or repayments of the RCF during
the current year and at 2 April 2022, there were GBPnil outstanding
drawings.
The Group is in compliance with the financial and other
covenants within the facilities and has been in compliance
throughout the financial period.
On 14 May 2020, Burberry Limited issued commercial paper with a
face value of GBP300 million, issued at a discount with zero
coupon, and a maturity of 17 March 2021. The commercial paper was
issued under a GBP300 million facility the Group agreed under the
UK Government sponsored COVID Corporate Finance Facility (CCFF). An
increase to the Group's CCFF of GBP300 million to GBP600 million
was made available from 29 May 2020 however no further commercial
paper was issued. The CCFF was repaid in full on 10 February 2021
and the facility expired on 23 March 2021.
23. Share capital and reserves
Allotted, called up and fully paid share capital Number GBPm
Ordinary shares of 0.05p (as at 27 March 2021:
0.05p) each
As at 28 March 2020 404,705,886 -
Allotted on exercise of options during the year 158,473 -
As at 27 March 2021 404,864,359 -
Allotted on exercise of options during the year 242,942 -
As at 2 April 2022 405,107,301 -
The Company has a general authority from shareholders, renewed
at each Annual General Meeting, to repurchase a maximum of 10% of
its issued share capital. During the 53 weeks to 2 April 2022, the
Company entered into agreements to purchase GBP150 million of its
own shares excluding stamp duty, as part of a share buy-back
programme (last year: GBPnil). Own shares purchased by the Company,
as part of a share buy-back programme, are classified as treasury
shares and their cost offset against retained earnings, as the
amounts paid reduce the profits available for distribution by the
Company. When treasury shares are cancelled, a transfer is made
from retained earnings to the capital redemption reserve,
equivalent to the nominal value of the shares purchased and
subsequently cancelled. In the 53 weeks to 2 April 2022, no
treasury shares were cancelled (last year: no treasury shares were
cancelled).
As at 2 April 2022 the Company held 8.4 million treasury shares
(last year: nil), with a market value of GBP140 million based on
the share price at the reporting date (last year: GBPnil).
The cost of shares purchased by ESOP trusts are offset against
retained earnings, as the amounts paid reduce the profits available
for distribution by the Company. As at 2 April 2022, the amount of
own shares held by ESOP trusts and offset against retained earnings
is GBP11 million (last year: GBP13 million). As at 2 April 2022,
the ESOP trusts held 0.6 million shares (last year: 0.8 million) in
the Company, with a market value of GBP10 million (last year: GBP15
million). In the 53 weeks to 2 April 2022 the ESOP trusts and the
Company have waived their entitlement to dividends.
The capital reserve consists of non-distributable reserves and
the capital redemption reserve arising on the purchase of own
shares.
Other reserves in the Statement of Changes in Equity consists of
the capital reserve, the foreign currency translation reserve, and
the hedging reserves. The hedging reserves consist of the cash flow
hedge reserve and the net investment hedge reserve.
Hedging reserves
Foreign
currency
Capital Cash flow Net investment translation
reserve hedges hedge reserve Total
GBPm GBPm GBPm GBPm GBPm
Balance as at 28 March
2020 41 - 5 245 291
Other comprehensive income:
Cash flow hedges - losses
deferred in equity - (1) - - (1)
Cash flow hedges - losses
transferred to cost of
sales - 1 - - 1
Foreign currency translation
differences - - - (51) (51)
Tax on other comprehensive
income - - - 2 2
Total comprehensive loss
for the year - - - (49) (49)
Balance as at 27 March
2021 41 - 5 196 242
Other comprehensive income:
Cash flow hedges - losses
deferred in equity - (1) - - (1)
Foreign currency translation
differences - - - 22 22
Total comprehensive loss
for the year - (1) - 22 21
Balance as at 2 April 2022 41 (1) 5 218 263
As at 2 April 2022 the amount held in the hedging reserve
relating to matured net investment hedges is GBP5 million net of
tax (last year: GBP5 million).
24. Capital commitments
Contracted capital commitments represent contracts entered into
by the year end and future work in respect of major capital
expenditure projects where activity has commenced by the year end
relating to property, plant and equipment and intangible
assets.
As at As at
2 April 27 March
2022 2021
GBPm GBPm
Capital commitments contracted but not provided
for:
Property, plant and equipment 29 25
Intangible assets 2 3
Total 31 28
25. Related party transactions
Transactions between the Company and its subsidiaries, which are
related parties of the Company, have been eliminated on
consolidation and are not disclosed in this note. Total
compensation in respect of key management, who are defined as the
Board of Directors and certain members of senior management, is
considered to be a related party transaction.
The total compensation in respect of key management for the year
was as follows:
53 weeks 52 weeks
to to
2 April 27 March
2022 2021
GBPm GBPm
Salaries, short-term benefits and social security
costs(1) 8 8
Termination benefits - 1
Share--based compensation (all awards and options
settled in shares) 1 1
Total 9 10
1. Pension cash allowance is included within salaries,
short-term benefits and social security costs
There were no other material related party transactions in the
year.
26. Subsidiary undertakings and investments
In accordance with Section 409 of the Companies Act 2006 a full
list of related undertakings as at 2 April 2022, including their
country of incorporation and percentage share ownership, is
disclosed below. Unless otherwise stated, all undertakings are
indirectly owned by Burberry Group plc and operate in the country
of incorporation. All the subsidiary undertakings have been
consolidated as at 2 April 2022.
Country/territory Holding Registered
Company name of incorporation Interest (%) Office
Burberry Pacific Pty Ltd Australia Ordinary shares 100 1
Burberry (Austria) GmbH Austria Ordinary shares 100 2
Sandringham Bahrain SPC W.L.L.(2) Bahrain Ordinary shares 100 3
Burberry Antwerp NV Belgium Ordinary shares 100 4
Burberry Brasil Comércio
de Artigos de Vestuário
e Acessórios Ltda Brazil Quota 100 5
Burberry Canada Inc Canada Common shares 100 6
Burberry (Shanghai) Trading
Co., Ltd China Equity interest 100 7
Burberry Czech Rep s.r.o. Czech Republic Ordinary shares 100 8
Burberry France SASU France Ordinary shares 100 9
Burberry (Deutschland) GmbH Germany Ordinary shares 100 10
Hong Kong S.A.R.,
Burberry Asia Holdings Limited China Ordinary shares 100 11
Hong Kong S.A.R.,
Burberry Asia Limited China Ordinary shares 100 11
Hong Kong S.A.R.,
Burberry China Holdings Limited China Ordinary shares 100 11
Burberry Hungary Kereskedelmi
Korlátolt Felel sségű
Társaság Hungary Ordinary shares 100 12
Burberry India Private Limited India Ordinary shares 51 13
Burberry Ireland Investments
Unlimited Company Ireland Ordinary A shares 100 14
Ordinary B shares 100
Burberry Ireland Limited Ireland Ordinary shares 100 15
Burberry Italy (Rome) S.R.L. Italy Quota 100 16
Burberry Italy S.R.L.(1) Italy Quota 100 16
Burberry Manifattura S.R.L. Italy Quota 100 17
Burberry Japan K.K. Japan Ordinary shares 100 18
Burberry Kuwait General Trading
Textiles and Accessories Company
With Limited Liability(3) Kuwait Parts 49 19
Macau S.A.R.,
Burberry Macau Limited China Quota 100 20
Burberry (Malaysia) Sdn. Bhd. Malaysia Ordinary shares 100 21
Horseferry México S.A. Ordinary (fixed)
de C.V. Mexico shares 100 22
Ordinary (variable)
shares 100
Horseferry México Servicios
Administrativos, S.A. Ordinary (fixed)
de C.V. Mexico shares 100 22
Burberry Netherlands B.V. Netherlands Ordinary shares 100 23
Burberry New Zealand Limited New Zealand Ordinary shares 100 24
Burberry Qatar W.L.L(3) Qatar Ordinary shares 49 25
Republic of
Burberry Korea Limited Korea Common stock 100 26
Participatory
Burberry Retail LLC Russian Federation share 100 27
Kingdom of Saudi
Burberry Saudi Company Limited Arabia Ordinary shares 100 28
Burberry (Singapore) Distribution
Company PTE Ltd Singapore Ordinary shares 100 29
Burberry (Spain) Retail S.L. Spain Ordinary shares 100 30
Burberry Latin America Holdings
S.L. Spain Ordinary shares 100 31
Burberry (Suisse) SA(1) Switzerland Ordinary shares 100 32
Taiwan Area,
Burberry (Taiwan) Co., Ltd China Common shares 100 33
Burberry (Thailand) Limited Thailand Common shares 100 34
Country of Holding Registered
Company name incorporation Interest (%) Office
Burberry Turkey Giyim Toptan
Ve Perakende Satı
Limited irketi Turkey Ordinary shares 100 35
United Arab
Burberry FZ-LLC Emirates Ordinary shares 100 36
United Arab
Burberry Middle East LLC(3) Emirates Ordinary shares 49 37
Burberry (Espana) Holdings
Limited United Kingdom Ordinary shares 100 38
Burberry (No. 7) Unlimited United Kingdom Ordinary shares 100 38
Burberry (UK) Limited United Kingdom Ordinary shares 100 38
Burberry Beauty Limited(1,4) United Kingdom Ordinary shares 100 38
Burberry Distribution Limited(,4) United Kingdom Ordinary shares 100 38
Burberry Europe Holdings
Limited(1) United Kingdom Ordinary shares 100 38
Burberry Finance Limited United Kingdom Ordinary shares 100 38
Burberry Haymarket Limited(1) United Kingdom Ordinary shares 100 38
Burberry Holdings Limited United Kingdom Ordinary shares 100 38
Burberry International
Holdings Limited(1) United Kingdom Ordinary shares 100 38
Burberry Latin America
Limited United Kingdom Ordinary shares 100 38
Burberry Limited United Kingdom Ordinary shares 100 38
Burberry London Limited United Kingdom Ordinary shares 100 38
Burberry Treasury Limited(,4) United Kingdom Ordinary shares 100 38
Burberrys Limited(1) United Kingdom Ordinary shares 100 38
Hampstead (UK) Limited(1,
4) United Kingdom Ordinary shares 100 38
Sweet Street Developments
Limited United Kingdom Ordinary shares 100 38
The Scotch House Limited(1) United Kingdom Ordinary shares 100 38
Thomas Burberry Holdings
Limited(1) United Kingdom Ordinary shares 100 38
Thomas Burberry Limited(1) United Kingdom Ordinary shares 100 38
Woodrow-Universal Limited(1) United Kingdom Ordinary shares 100 38
Woodrow-Universal Pension
Trustee Limited(1) United Kingdom Ordinary shares 100 38
Class X common
Burberry (Wholesale) Limited United States stock 100 39
Class Y common
stock 100
Class X common
Burberry Limited United States stock 100 39
Class Y common
stock 100
Burberry North America,
Inc. United States Common stock 100 40
Burberry Warehousing Corporation(,5) United States Common stock 100 40
Castleford Industries, Series A common
Ltd. (5) United States stock 100 40
Castleford Tailors, Ltd.
(5) United States Common stock 100 40
1. Held directly by Burberry Group plc.
2. The Group has an indirect holding of 100% of the issued share
capital through a nominee.
3. The Group has a 100% share of profits of Burberry Middle East
LLC as well as a 100% and 88% share of profits in Burberry Middle
East LLC's subsidiaries in Kuwait and Qatar respectively. The Group
has the power to control these companies under the agreements
relating to Burberry Middle East LLC.
4. An application for voluntary strike off was made on 25 March
2022.
5. Certificate of dissolution was filed on 28 March 2022.
Ref Registered office address
1 Level 5, 343 George Street, Sydney NSW 2000, Australia
2 Kohlmarkt 2, 1010 Wien, Austria
Building 1A, Road 365, Manama Center 316, Unit 8, Moda Mall,
3 Manama, Bahrain
4 Boulevard de Waterloo 16, Brussel, Belgium
5 City of São Paulo, State of São Paulo, at Rua do
Rocio, 350, 3rd Pavement of Condominium Atrium IX, suites
No. 31 and No. 32, 28th subdistrict, Vila Olímpia, CEP
04552-000, Brazil
100 King Street West, 1 First Canadian Place, Suite 1600,
6 Toronto ON M5X 1G5, Canada
60th Floor (Actual Floor No.53), Wheelock Square, 1717 Nanjing
7 West Road, Shanghai 200040, China
Praha 1, Paří ská 11/67, PSČ 11000, Czech
8 Republic
9 56A rue du Faubourg Saint-Honoré, 75008, Paris, France
10 Königsallee 50, 40212, Düsseldorf, Germany
Suites 2201-02 & 11-14, 22/F Devon House, Taikoo Place, 979
11 King's Road, Quarry Bay, Hong Kong
12 1124 Budapest, Csörsz utca 49-51, Hungary
3 A-1 Taj Apartment, Rao Tula Ram Marg, New Delhi, 110022,
13 India
Suite 9, Bunkilla Plaza, Bracetown Business Park, Clonee,
14 Co. Meath., D15 XR27, Ireland
Suite 9, Bunkilla Plaza, Bracetown Office Park, Clonee, Co.
15 Meath., D15 XR27, Ireland
16 Via Manzoni n.20, 20121, Milan
17 Via delle Fonti n.10, 50018 Scandicci
18 5-14 Ginza 2-chome, Chuo-ku, Tokyo, Japan
Hawali, Street 276, Block 8, Plot 9301, Office No 12, Floor
19 7, Kuwait
Avenida Dr. Sun Yat Sen, One Central Building, 1st floor,
20 Shops 125-127, Macau
21 Level 21, Suite 21.01, The Gardens South Tower, Mid Valley
City, Lingkaran Syed Putra, 59200 Kuala Lumpur, Wilayah Persekutuan,
Malaysia
Edgar Allan Poe 85-B, Col. Polanco, Delg. Miguel Hidalgo,
22 Mexico City, 11560, Mexico
Pieter Cornelisz. Hooftstraat 48 H, -50, 1071BZ Amsterdam,
23 Netherlands
Level 20, HSBC Tower, 188 Quay Street, Auckland, 1010, New
24 Zealand
First Floor, Building No. 660, Street no. 364, Al Waab, Zone
25 No.54, Al Marikh, Al Rayyan Municipality, Qatar
(Cheongdam-dong) 459, Dosan-daero, Gangnam-gu, Seoul, Republic
26 of Korea
Ulitsa Petrovka, 16, floor 3, Premise I, rooms 47-53, 127051,
27 Moscow, Russian Federation
Riyadh, Al Olaya District, Akaria Plaza, First Floor, P.O.Box
28 359, 11411, Kingdom of Saudi Arabia
29 391B Orchard Road, #15-02/03, Ngee Ann City, 238874, Singapore
30 Passeig de Gràcia, 56, 08007 Barcelona
31 Calle Valencia 640, 08026 Barcelona, Spain
Route de Chêne 30A, c/o L&S Trust Services SA, 1208
32 Genève, Switzerland
33 (105) 5F, No. 451, Changchun Rd., Taipei City, Taiwan
34 No. 989 Siam Piwat Tower, 12A Floor, Unit B1, B2, Rama I
Road, Pathumwan Sub-district, Pathumwan District,
Bangkok, Thailand
Re itpa a Mahallessi Eski Büyükdere Cad. Windowist
35 Tower Sit. No: 26/1 Sariyer/Istanbul, Turkey
Dubai Design District, Premises: 301, 312, 313, 314 & 315,
36 Floor: 03, Building: 08, Dubai, United Arab Emirates
Owned by Dubai Design District, Building 8, Level 3, PO Box
37 333266, Dubai, United Arab Emirates
Horseferry House, Horseferry Road, London, SW1P 2AW, United
38 Kingdom
CT Corporation System, 28 Liberty St., New York, New York,
39 10005, United States
40 The Corporation Trust Company, Corporation Trust Center 1209
Orange St, Wilmington, New Castle, DE 19801,
United States
27. Contingent liabilities
The Group is subject to claims against it and to tax audits in a
number of jurisdictions which arise in the ordinary course of
business. These typically relate to Value Added Taxes, sales taxes,
customs duties, corporate taxes, transfer pricing, payroll taxes,
various contractual claims, legal proceedings and other matters.
Where appropriate, the estimated cost of known obligations have
been provided in these financial statements in accordance with the
Group's accounting policies. The Group does not expect the outcome
of current similar contingent liabilities to have a material effect
on the Group's financial position.
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FR DDGDUUGBDGDR
(END) Dow Jones Newswires
May 18, 2022 02:06 ET (06:06 GMT)
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