TIDMKGF
RNS Number : 9273Z
Kingfisher PLC
20 September 2022
Kingfisher plc
2022/23 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED INCOME STATEMENT
Half year ended 31 July 2022 Half year ended 31 July 2021
------------------------------------------ ------------------------------------------
Before Before
adjusting Adjusting adjusting Adjusting
GBP millions Notes items items (note 5) Total items items (note 5) Total
-------------------- ------ --------------- --------------- -------- --------------- --------------- --------
Sales 4 6,809 - 6,809 7,101 - 7,101
Cost of sales (4,313) - (4,313) (4,404) - (4,404)
--------------- -------- --------------- --------
Gross profit 2,496 - 2,496 2,697 - 2,697
Selling and
distribution
expenses (1,549) 1 (1,548) (1,554) - (1,554)
Administrative
expenses (434) - (434) (417) 7 (410)
Other income 11 1 12 12 1 13
Share of post-tax
results of joint
ventures and
associates 5 - 5 1 - 1
Operating profit 4 529 2 531 739 8 747
Finance costs (65) - (65) (76) - (76)
Finance income 8 - 8 6 - 6
-------------------- ------ --------------- --------------- -------- --------------- --------------- --------
Net finance costs 6 (57) - (57) (70) - (70)
-------------------- ------ --------------- --------------- -------- --------------- --------------- --------
Profit before
taxation 472 2 474 669 8 677
Income tax expense 7 (104) 3 (101) (144) 23 (121)
-------------------- ------ --------------- --------------- -------- --------------- --------------- --------
Profit for the
period 368 5 373 525 31 556
-------------------- ------ --------------- --------------- -------- --------------- --------------- --------
Earnings per share 8
Basic 18.6p 26.4p
Diluted 18.3p 26.2p
Adjusted basic 18.3p 24.9p
Adjusted diluted 18.0p 24.7p
-------------------- ------ --------------- --------------- -------- --------------- --------------- --------
The proposed interim ordinary dividend for the period ended 31
July 2022 is 3.80p per share (2021/22: 3.80p per share).
Kingfisher plc
2022/23 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED INCOME STATEMENT
Year ended 31 January 2022
---------------------------------------
Adjusting
Before adjusting items
GBP millions Notes items (note 5) Total
---------------------------------------------------- -------- ----------------- ---------- --------
Sales 4 13,183 - 13,183
Cost of sales (8,248) - (8,248)
Gross profit 4,935 - 4,935
Selling and distribution expenses (3,041) 42 (2,999)
Administrative expenses (836) 13 (823)
Other income 23 3 26
Share of post-tax results of joint ventures and associates 5 - 5
Operating profit 4 1,086 58 1,144
Finance costs (148) - (148)
Finance income 11 - 11
---------------------------------------------------- -------- ----------------- ---------- --------
Net finance costs 6 (137) - (137)
---------------------------------------------------- -------- ----------------- ---------- --------
Profit before taxation 949 58 1,007
Income tax expense 7 (212) 48 (164)
---------------------------------------------------- -------- ----------------- ---------- --------
Profit for the year 737 106 843
---------------------------------------------------- -------- ----------------- ---------- --------
Earnings per share 8
Basic 40.3p
Diluted 39.8p
Adjusted basic 35.2p
Adjusted diluted 34.8p
Kingfisher plc
2022/23 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Half year ended Half year ended Year ended
GBP millions Notes 31 July 2022 31 July 2021 31 January 2022
------------------------------------------- -------- ---------------- ---------------- ---------------------------
Profit for the period 373 556 843
------------------------------------------- -------- ---------------- ---------------- ---------------------------
Remeasurements of post-employment benefits 11 (14) (12) 21
Inventory cash flow hedges - fair value
gains 113 6 59
Tax on items that will not be reclassified (24) 1 (18)
------------------------------------------- -------- ---------------- ---------------- ---------------------------
Total items that will not be reclassified
subsequently to profit or loss 75 (5) 62
------------------------------------------- -------- ---------------- ---------------- ---------------------------
Currency translation differences
Group (22) (148) (218)
Joint ventures and associates (1) (2) (7)
Other cash flow hedges
Fair value gains - 4 1
Gains transferred to income statement - (4) (1)
Total items that may be reclassified
subsequently to profit or loss (23) (150) (225)
-------- ---------------- ----------------
Other comprehensive income/(expense) for
the period 52 (155) (163)
------------------------------------------- -------- ---------------- ---------------- ---------------------------
Total comprehensive income for the period 425 401 680
------------------------------------------- -------- ---------------- ---------------- ---------------------------
Kingfisher plc
2022/23 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Half year ended 31 July
2022
----------- ---------- -------- ----------- -------------------------------------
Other
Own Capital reserves
Share Share shares Retained redemption (note Total
GBP millions capital premium held earnings reserve 14) equity
------------------------- ----------- ---------- -------- ----------- ------------ ---------- -----------
At 1 February 2022 325 2,228 (46) 4,025 50 196 6,778
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Profit for the period - - - 373 - - 373
Other comprehensive
(expense)/income
for the period - - - (10) - 62 52
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Total comprehensive
income
for the period - - - 363 - 62 425
Inventory cash flow
hedges
- gains transferred to
inventories - - - - - (61) (61)
Share-based compensation - - - 11 - - 11
New shares issued under
share
schemes - - - 2 - - 2
Own shares issued under
share
schemes - - 17 (17) - - -
Purchase of own shares
for
cancellation (13) - - (225) 13 - (225)
Dividends - - - (172) - - (172)
Tax on equity items - - - (1) - 14 13
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
At 31 July 2022 312 2,228 (29) 3,986 63 211 6,771
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Half year ended 31 July 2021
----------- -------------------------------------------------------------------------
Other
Own Capital reserves
Share Share shares Retained redemption (note Total
GBP millions capital premium held earnings reserve 14) equity
------------------------ ----------- ----------- -------- ----------- ------------ ---------- -----------
At 1 February 2021 332 2,228 (23) 3,630 43 361 6,571
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Profit for the period - - - 556 - - 556
Other comprehensive
expense
for the period - - - (9) - (146) (155)
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Total comprehensive
income/(expense)
for the period - - - 547 - (146) 401
Inventory cash flow
hedges
- losses transferred to
inventories - - - - - 34 34
Share-based compensation - - - 14 - - 14
New shares issued under
share
schemes - - - 2 - - 2
Own shares issued under
share
schemes - - 11 (11) - - -
Purchase of own shares
for
ESOP trust - - (29) - - - (29)
Dividends - - - (174) - - (174)
Tax on equity items - - - - - (8) (8)
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
At 31 July 2021 332 2,228 (41) 4,008 43 241 6,811
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Year ended 31 January 2022
---------- ------------------------------------------------------------------------
Other
Own Capital reserves
Share Share shares Retained redemption (note Total
GBP millions capital premium held earnings reserve 14) equity
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
At 1 February 2021 332 2,228 (23) 3,630 43 361 6,571
Profit for the year - - - 843 - - 843
Other comprehensive
income/(expense)
for the year - - - 16 - (179) (163)
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Total comprehensive
income/(expense)
for the year - - - 859 - (179) 680
Inventory cash flow
hedges
- losses transferred to
inventories - - - - - 16 16
Share-based compensation - - - 27 - - 27
New shares issued under
share
schemes - - - 5 - - 5
Own shares issued under
share
schemes - - 15 (15) - - -
Purchase of own shares
for
cancellation (7) - - (226) 7 - (226)
Purchase of own shares
for
ESOP trust - - (38) - - - (38)
Dividends - - - (254) - - (254)
Tax on equity items - - - (1) - (2) (3)
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
At 31 January 2022 325 2,228 (46) 4,025 50 196 6,778
-------------------------- ---------- ---------- -------- ----------- ------------ ---------- -----------
Kingfisher plc
2022/23 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED BALANCE SHEET
GBP millions Notes At 31 July 2022 At 31 July 2021 At 31 January 2022
---------------------------------------------- ------ ---------------- ------------------ ---------------------
Non-current assets
Goodwill 2,424 2,425 2,424
Other intangible assets 10 353 320 330
Property, plant and equipment 10 3,086 2,982 3,078
Investment property 10 33 20 33
Right-of-use assets 1,842 1,785 1,885
Investments in joint ventures and associates 20 18 17
Post-employment benefits 11 542 506 540
Deferred tax assets 9 19 10
Other tax authority asset 17 64 64 64
Derivative assets 12 2 - 1
Other receivables 17 26 22
---------------------------------------------- ------ ---------------- ------------------ ---------------------
8,392 8,165 8,404
Current assets
Inventories 3,138 2,730 2,749
Trade and other receivables 364 317 300
Derivative assets 12 82 11 37
Current tax assets 37 23 33
Cash and cash equivalents 496 1,535 823
Assets held for sale 5 6 6
4,122 4,622 3,948
---------------------------------------------- ------ ---------------- ------------------ ---------------------
Total assets 12,514 12,787 12,352
---------------------------------------------- ------ ---------------- ------------------ ---------------------
Current liabilities
Trade and other payables (2,891) (2,947) (2,674)
Borrowings 12 (17) (111) (14)
Lease liabilities (334) (333) (347)
Derivative liabilities 12 (13) (27) (12)
Current tax liabilities (19) (126) (46)
Provisions (16) (35) (23)
(3,290) (3,579) (3,116)
Non-current liabilities
Other payables (10) (11) (10)
Borrowings 12 (1) (2) (2)
Lease liabilities (1,984) (1,986) (2,029)
Derivative liabilities 12 - - (1)
Deferred tax liabilities (310) (231) (276)
Provisions (12) (22) (10)
Post-employment benefits 11 (136) (145) (130)
(2,453) (2,397) (2,458)
---------------------------------------------- ------ ---------------- ------------------ ---------------------
Total liabilities (5,743) (5,976) (5,574)
---------------------------------------------- ------ ---------------- ------------------ ---------------------
Net assets 6,771 6,811 6,778
---------------------------------------------- ------ ---------------- ------------------ ---------------------
Equity
Share capital 13 312 332 325
Share premium 2,228 2,228 2,228
Own shares held in ESOP trust (29) (41) (46)
Retained earnings 3,986 4,008 4,025
Capital redemption reserve 63 43 50
Other reserves 14 211 241 196
---------------------------------------------- ------ ---------------- ------------------ ---------------------
Total equity 6,771 6,811 6,778
---------------------------------------------- ------ ---------------- ------------------ ---------------------
The interim financial report was approved by the Board of
Directors on 19 September 2022 and signed on its behalf by:
Thierry Garnier, Chief Executive Bernard Bot , Chief Financial
Officer Officer
Kingfisher plc
2022/23 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED CASH FLOW STATEMENT
Half year ended Half year ended Year ended
GBP millions Notes 31 July 2022 31 July 2021 31 January 2022
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Operating activities
Cash generated by operations 15 584 1,161 1,411
Income tax paid (75) (78) (169)
French tax authority payment 7 (34) - -
Other tax authority payments 17 - (64) (64)
---------------- ---------------- -----------------
Net cash flows from operating activities 475 1,019 1,178
Investing activities
Purchase of property, plant and equipment and
intangible assets (184) (131) (397)
Disposal of property, plant and equipment, investment
property, assets held for sale and intangible
assets 1 7 9
Disposal of businesses, net of cash disposed - - 7
Interest received 1 1 2
Interest element of lease rental receipts 1 1 1
Principal element of lease rental receipts 2 2 3
Advance payments on right-of-use assets (2) (1) (11)
Advance receipts on right-of-use assets 2 - -
Dividends received from joint ventures and associates 1 1 1
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Net cash flows used in investing activities (178) (120) (385)
Financing activities
Interest paid (3) (5) (22)
Interest element of lease rental payments (62) (69) (135)
Principal element of lease rental payments (164) (177) (341)
Repayment of bank loans - (3) (2)
Repayment of fixed term debt - - (95)
New shares issued under share schemes 2 2 5
Purchase of own shares for cancellation (218) - (157)
Purchase of own shares for ESOP trust (9) (29) (29)
Ordinary dividends paid to equity shareholders of the
Company 9 (172) (174) (254)
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Net cash flows used in financing activities (626) (455) (1,030)
Net (decrease)/increase in cash and cash equivalents
and bank overdrafts (329) 444 (237)
Cash and cash equivalents and bank overdrafts at
beginning of period 809 1,136 1,136
Exchange differences (1) (64) (90)
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Cash and cash equivalents and bank overdrafts at end
of period 479 1,516 809
------------------------------------------------------- ------ ---------------- ---------------- -----------------
Kingfisher plc
2022/23 INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. General information
Kingfisher plc ('the Company'), its subsidiaries, joint ventures
and associates (together 'the Group') supply home improvement
products and services through a network of retail stores and other
channels, located mainly in the United Kingdom and continental
Europe.
The Company is incorporated in England and Wales, United
Kingdom, and is listed on the London Stock Exchange. The address of
its registered office is 3 Sheldon Square, Paddington, London W2
6PX.
The interim financial report does not comprise statutory
accounts within the meaning of section 434 of the Companies Act
2006. Audited statutory accounts for the year ended 31 January 2022
were approved by the Board of Directors on 21 March 2022 and
delivered to the Registrar of Companies. The report of the auditors
on those accounts was unqualified, did not contain an emphasis of
matter paragraph and did not contain any statement under sections
498(2) or (3) of the Companies Act 2006. The interim financial
report has been reviewed, not audited, and was approved by the
Board of Directors on 19 September 2022.
2. Basis of preparation
The interim financial report for the six months ended 31 July
2022 ('the half year') has been prepared in accordance with the
Disclosure and Transparency Rules of the Financial Conduct
Authority and with IAS 34, 'Interim Financial Reporting', as
adopted by the United Kingdom. It should be read in conjunction
with the annual financial statements for the year ended 31 January
2022, which have been prepared in accordance with United Kingdom
adopted international accounting standards and International
Financial Reporting Standards (IFRSs). The financial statements
have also been prepared in accordance with International Financial
Reporting Standards as issued by the IASB. The consolidated income
statement and related notes represent results for continuing
operations, there being no discontinued operations in the periods
presented. Where comparatives are given, '2021/22' refers to the
six months ended 31 July 2021.
Going concern
Based on the Group's liquidity position and cash flow
projections, including a forward looking remote downside scenario,
the Directors have a reasonable expectation that the Company and
the Group have adequate resources to continue in operational
existence for the foreseeable future and they continue to adopt the
going concern basis of accounting in preparing the condensed
consolidated financial statements for the period ended 31 July
2022.
Considering whether the Group's condensed consolidated financial
statements can be prepared on a going concern basis, the Directors
have reviewed the Group's business activities together with factors
likely to affect its performance, financial position and access to
liquidity (including consideration of financial covenants and
credit ratings).
In forming their outlook on the future financial performance,
the Directors considered the post-COVID normalisation of store
traffic and average spend, the risk of higher business volatility
and the potential negative impact of the general economic
environment on household and trade spend.
The Directors' review also included a remote scenario that
considers the impact of a significant drop in sales over a period
of six months followed by a period of recovery lasting two months
before trading resumes to the base case expected forecast. The
total loss of sales in this scenario is c.GBP1.9bn (22% over the
impacted period). The scenario assumes the impact of lost sales is
partially offset by a limited set of mitigating actions on variable
and discretionary costs, capital expenditure and the suspension of
capital returns to shareholders. Even under this remote scenario,
which requires drawing on the revolving credit facility (RCF) for a
few months, the group retains headroom on its credit facilities.
Given current trading and expectations for the business, the
Directors believe that this scenario reflects a remote outcome for
the Group. Should a more extreme scenario occur than currently
forecast by the Directors under this remote scenario, the Group
would need to implement additional operational or financial
measures.
New and amended accounting standards
New standards, amendments and interpretations are in issue and
effective for the Group's financial year ended 31 January
2023, but they do not have a material impact on the interim
financial report.
Principal rates of exchange against Sterling
Half year ended 31 Half year ended 31 Year ended 31 January
July 2022 July 2021 2022
--------------------- --------------------- ------------------------
Average Period end Average Period end Average Year end
rate rate rate rate rate rate
-------------- -------- ----------- -------- ----------- ----------- -----------
Euro 1.18 1.19 1.16 1.17 1.17 1.20
US Dollar 1.27 1.22 1.39 1.39 1.38 1.34
Polish Zloty 5.53 5.64 5.27 5.35 5.34 5.49
Romanian Leu 5.85 5.87 5.70 5.76 5.76 5.92
-------------- -------- ----------- -------- ----------- ----------- -----------
Risks and uncertainties
The principal risks and uncertainties to which the Group is
exposed are set out on pages 42-48 of the Kingfisher plc Annual
Report and Accounts for the year ended 31 January 2022. These have
been reviewed as part of the Group's half year procedures and are
listed in the Financial Review.
Use of non-GAAP measures
In the reporting of financial information, the Group uses
certain measures that are not required under IFRS, the generally
accepted
accounting principles ('GAAP') under which the Group reports.
The Group believes that retail profit, adjusted pre-tax profit,
adjusted effective tax rate, and adjusted earnings per share
provide additional useful information on performance and trends to
shareholders. These and other non-GAAP measures (also known as
'Alternative Performance Measures'), such as net debt, are used by
the Group for internal performance analysis and incentive
compensation arrangements for employees. The terms 'retail profit',
'adjusting items', 'adjusted', 'adjusted effective tax rate', 'net
cashflow' and 'net debt' are not defined terms under IFRS and may
therefore not be comparable with similarly titled measures reported
by other companies. They are not intended to be a substitute for,
or superior to, GAAP measures.
Retail profit is defined as continuing operating profit before
central costs, the Group's share of interest and tax of joint
ventures and associates and adjusting items. Central costs
principally comprise the costs of the Group's head office before
adjusting items.
Adjusting items, which are presented separately within their
relevant income statement category, include items which by virtue
of their size and/or nature, do not reflect the Group's ongoing
trading performance. Adjusting items may include, but are not
limited to:
-- non-trading items included in operating profit such as
profits and losses on the disposal, closure, exit or impairment of
subsidiaries, joint ventures, associates and investments which do
not form part of the Group's ongoing trading activities;
-- the costs of significant restructuring and incremental acquisition integration costs;
-- profits and losses on the disposal/exit of properties,
impairments of goodwill and significant impairments (or impairment
reversals) of other non-current assets;
-- prior year tax items (including the impact of changes in tax
rates on deferred tax), significant one-off tax settlements and
provision charges/releases and the tax effects of other adjusting
items;
-- financing fair value remeasurements i.e. changes in the fair
value of financing derivatives, excluding interest accruals, offset
by fair value adjustments to the carrying amount of borrowings and
other hedged items under fair value (or non-designated) hedge
relationships. Financing derivatives are those that relate to
hedged items of a financing nature.
The term 'adjusted' refers to the relevant measure being
reported for continuing operations excluding adjusting items.
The adjusted effective tax rate is calculated as continuing
income tax expense excluding prior year tax items (including the
impact of changes in tax rates on deferred tax), significant
one-off tax settlements and provision charges/releases and the tax
effects of other adjusting items, divided by continuing profit
before taxation excluding adjusting items. Prior year tax items
represent income statement tax relating to underlying items
originally arising in prior years, including the impact of changes
in tax rates on deferred tax. The exclusion of items relating to
prior years, and those not in the ordinary course of business,
helps provide a better indication of the Group's ongoing rate of
tax.
Net debt comprises lease liabilities, borrowings and financing
derivatives (excluding accrued interest) less cash and cash
equivalents and short-term deposits, including such balances
classified as held for sale.
Refer to the Financial Review for definitions of all of the
Group's Alternative Performance Measures, including further
information on why they are used and details of where
reconciliations to statutory measures can be found where
applicable.
3. Accounting policies
The accounting policies adopted are consistent with those of the
annual financial statements for the year ended 31 January 2022, as
described in note 2 of those financial statements, except where set
out below. The critical accounting estimates and judgements are set
out in note 3 of the annual financial statements for the year ended
31 January 2022 and remain unchanged.
Taxes on income for interim periods are accrued using the best
estimate of the effective tax rate that would be applicable to
expected total annual earnings.
4. Segmental analysis
Income statement
Half year ended 31 July 2022
------------------------------------------------------------------
Other
GBP millions UK & Ireland France Poland Other International Total
--------------------------------- ------------- ------- ------- --------------- --------
Sales 3,221 2,325 913 350 1,263 6,809
--------------------------------- ------------- ------- ------- ------ --------------- --------
Retail profit 339 129 94 (7) 87 555
------- ------
Central costs (26)
Adjusting items 2
--------------------------------- ------------- ------- ------- ------ --------------- --------
Operating profit 531
Net finance costs (57)
--------------------------------- ------------- ------- ------- ------ --------------- --------
Profit before taxation 474
--------------------------------- ------------- ------- ------- ------ --------------- --------
Half year ended 31 July 2021
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
--------------------------------------- ------------- ------- ------- -------------------- --------
Sales 3,570 2,437 743 351 1,094 7,101
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Retail profit 579 129 58 1 59 767
------- ------
Central costs (27)
Share of interest and tax of joint
ventures and associates (1)
Adjusting items 8
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Operating profit 747
Net finance costs (70)
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Profit before taxation 677
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Year ended 31 January 2022
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
--------------------------------------- ------------- ------- ------- -------------------- --------
Sales 6,505 4,498 1,525 655 2,180 13,183
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Retail profit 794 221 135 (2) 133 1,148
------- ------
Central costs (60)
Share of interest and tax of joint
ventures and associates (2)
Adjusting items 58
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Operating profit 1,144
Net finance costs (137)
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Profit before taxation 1,007
--------------------------------------- ------------- ------- ------- ------ -------------------- --------
Balance sheet
At 31 July 2022
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
--------------------------------- ------------- ------- ------- -------------------- --------
Segment assets 3,198 1,753 988 301 1,289 6,240
------- ------
Central liabilities (45)
Goodwill 2,424
Net debt (1,848)
--------------------------------- ------------- ------- ------- ------ -------------------- --------
Net assets 6,771
--------------------------------- ------------- ------- ------- ------ -------------------- --------
At 31 July 2021
-----------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
--------------------------------- ------------- ------- ------- -------------------- --------
Segment assets 2,595 1,535 918 271 1,189 5,319
------- ------
Central liabilities (25)
Goodwill 2,425
Net debt (908)
--------------------------------- ------------- ------- ------- ------ -------------------- --------
Net assets 6,811
--------------------------------- ------------- ------- ------- ------ -------------------- --------
At 31 January 2022
------------------------------------------------------------------------
GBP millions UK & Ireland France Poland Other Other International Total
--------------------------------- ------------- ------- ------- -------------------- ---------
Segment assets 3,052 1,682 942 332 1,274 6,008
------- ------
Central liabilities (82)
Goodwill 2,424
Net debt (1,572)
--------------------------------- ------------- ------- ------- ------ -------------------- ---------
Net assets 6,778
--------------------------------- ------------- ------- ------- ------ -------------------- ---------
The operating segments disclosed above are based on the
information reported internally to the Board of Directors and Group
Executive, representing the geographical areas in which the Group
operates. The Group only has one reportable business segment, being
the supply of home improvement products and services. The majority
of the sales in each geographical area are derived from in-store
and online sales of products.
The 'Other International' segment consists of Poland, Iberia,
Romania, the joint venture Koçta in Turkey, NeedHelp, Screwfix
International and results from franchise agreements. Poland has
been shown separately due to its significance.
Central costs principally comprise the costs of the Group's head
office. Central liabilities comprise unallocated head office and
other central items including central assets, pensions, insurance,
interest and tax.
The Group's sales, although generally not highly seasonal on a
half yearly basis, do increase over the Easter period and during
the summer months leading to slightly higher sales usually being
recognised in the first half of the year. However, due to the
continued uncertainty around the current macro-economic
environment, the phasing of sales is less predictable.
5. Adjusting items
Half year ended Year ended
GBP millions 31 July 2022 Half year ended 31 July 2021 31 January 2022
-------------------------------------------------- ---------------- ----------------------------- -----------------
Included within selling and distribution expenses
Release of France and other restructuring
provisions 1 - 9
Net store asset impairment reversals - - 33
1 - 42
-------------------------------------------------- ---------------- ----------------------------- -----------------
Included within administrative expenses
Release of France uncertain operating tax
position - 7 9
Commercial operating model restructuring - - 4
- 7 13
Included within other income
Profit on exit of properties 1 1 3
1 1 3
-------------------------------------------------- ---------------- ----------------------------- -----------------
Adjusting items before tax 2 8 58
Prior year and other adjusting tax items 3 23 48
-------------------------------------------------- ---------------- ----------------------------- -----------------
Adjusting items 5 31 106
-------------------------------------------------- ---------------- ----------------------------- -----------------
Current year adjusting items include a GBP1m credit arising due
to savings on costs relating to legacy store closure programmes in
France as compared with the original restructuring provisions
recognised as adjusting items.
A profit of GBP1m has been recorded on the exit of one property
in the UK.
Prior year and other adjusting tax items of GBP3m relates
principally to the impact of the enacted future increase in the UK
tax rate on deferred tax balances. This credit has been included
within the income tax expense for the period. Refer to note 7.
Refer to note 5 of the 2021/22 interim accounts for further
details on adjusting items for the half year ended 31 July 2021,
and to note 5 of the 2021/22 annual accounts for further details on
adjusting items for the year ended 31 January 2022.
6. Net finance costs
Half year ended 31 July Year ended
GBP millions Half year ended 31 July 2022 2021 31 January 2022
-------------------------------------- -------------------------------- ------------------------- -----------------
Bank overdrafts and bank loans (3) (4) (7)
Fixed term debt - (2) (3)
Lease liabilities (62) (69) (135)
Other interest payable - (1) (3)
Finance costs (65) (76) (148)
----------------------------------------------------- ----------------- ------------------------- -----------------
Cash and cash equivalents and short-term deposits 1 1 2
Net interest income on defined benefit pension
schemes 6 4 8
Finance lease income 1 1 1
Finance income 8 6 11
----------------------------------------------------- ----------------- ------------------------- -----------------
Net finance costs (57) (70) (137)
----------------------------------------------------- ----------------- ------------------------- -----------------
7. Income tax expense
Half year ended Half year ended Year ended
GBP millions 31 July 2022 31 July 2021 31 January 2022
------------------------------------------------ ---------------- ---------------- -----------------
UK corporation tax
Current tax on profits for the period (29) (78) (80)
Adjustments in respect of prior years - 3 2
------------------------------------------------ ---------------- ---------------- -----------------
(29) (75) (78)
------------------------------------------------ ---------------- ---------------- -----------------
Overseas tax
Current tax on profits for the period (49) (53) (87)
Adjustments in respect of prior years - (2) 31
(49) (55) (56)
------------------------------------------------ ---------------- ---------------- -----------------
Deferred tax
Current period (26) (16) (56)
Adjustments in respect of prior years 1 - 1
Adjustments in respect of changes in tax rates 2 25 25
(23) 9 (30)
------------------------------------------------ ---------------- ---------------- -----------------
Income tax expense (101) (121) (164)
------------------------------------------------ ---------------- ---------------- -----------------
The adjusted effective tax rate on profit before adjusting items
is 22% (2021/22: 22%), representing the best estimate of the
effective rate for the full financial year. The adjusted effective
tax rate on the same basis for the year ended 31 January 2022 was
22%. The adjusted effective tax rate calculation is set out in the
Financial Review in part 1 of this announcement.
During the period, a payment of EUR40m (GBP34m) was made to the
French tax authorities relating to a historic tax liability. This
amount was fully provided for at the prior year end.
8. Earnings per share
Half year ended Year ended
Pence 31 July 2022 Half year ended 31 July 2021 31 January 2022
------------------------------------------ ---------------- ------------------------------ -----------------
Basic earnings per share 18.6 26.4 40.3
Effect of dilutive share options (0.3) (0.2) (0.5)
------------------------------------------ ---------------- ------------------------------ -----------------
Diluted earnings per share 18.3 26.2 39.8
------------------------------------------ ---------------- ------------------------------ -----------------
Basic earnings per share 18.6 26.4 40.3
Adjusting items before tax (0.1) (0.4) (2.8)
Prior year and other adjusting tax items (0.2) (1.1) (2.3)
------------------------------------------ ---------------- ------------------------------ -----------------
Adjusted basic earnings per share 18.3 24.9 35.2
------------------------------------------ ---------------- ------------------------------ -----------------
Diluted earnings per share 18.3 26.2 39.8
Adjusting items before tax (0.1) (0.4) (2.7)
Prior year and other adjusting tax items (0.2) (1.1) (2.3)
------------------------------------------ ---------------- ------------------------------ -----------------
Adjusted diluted earnings per share 18.0 24.7 34.8
------------------------------------------ ---------------- ------------------------------ -----------------
The calculation of basic and diluted earnings per share is based
on the profit for the period attributable to equity shareholders of
the Company. A reconciliation of statutory earnings to adjusted
earnings is set out below:
Half year ended 31 July Half year ended 31 July Year ended
GBP millions 2022 2021 31 January 2022
------------------------------------ --------------------------- ---------------------------- -------------------
Profit for the period 373 556 843
Adjusting items before tax (2) (8) (58)
Prior year and other adjusting tax
items (3) (23) (48)
------------------------------------ --------------------------- ---------------------------- -------------------
Adjusted profit for the period 368 525 737
------------------------------------ --------------------------- ---------------------------- -------------------
The weighted average number of shares in issue during the
period, excluding those held in the Employee Share Ownership Plan
Trust ('ESOP trust'), is set out below:
Half year ended Year ended
Weighted average number of shares (millions) 31 July 2022 Half year ended 31 July 2021 31 January 2022
---------------------------------------------- ---------------- ----------------------------- -------------------
Basic 2,012 2,103 2,092
Diluted 2,035 2,125 2,116
---------------------------------------------- ---------------- ----------------------------- -------------------
9. Dividends
Half year ended Half year ended Year ended
GBP millions 31 July 2022 31 July 2021 31 January 2022
---------------------------------------------------------------- ---------------- ---------------- ----------------
Dividends to equity shareholders of the Company
Ordinary final dividend for the year ended 31 January 2022 of
8.60p per share 172 - -
Ordinary interim dividend for the year ended 31 January 2022 of
3.80p per share - - 80
Ordinary final dividend for the year ended 31 January 2021 of
5.50p per share - 116 116
Ordinary interim dividend for the year end 31 January 2021 of
2.75p per share - 58 58
172 174 254
---------------------------------------------------------------- ---------------- ---------------- ----------------
The proposed interim ordinary dividend for the period ended 31
July 2022 is 3.80p per share (2021/22: 3.80p per share).
10. Property, plant and equipment, investment property and other intangible assets
Additions to the cost of property, plant and equipment,
investment property and other intangible assets are GBP174m
(2021/22: GBP125m) and for the year ended 31 January 2022 were
GBP412m. Disposals in net book value of property, plant and
equipment, investment property, property assets held for sale and
other intangible assets are GBP1m (2021/22: GBP6m) and for the year
ended 31 January 2022 were GBP9m.
Capital commitments contracted but not provided for at the end
of the period are GBP55m (2021/22: GBP64m) and at 31 January 2022
were GBP31m.
11. Post-employment benefits
Half year ended Half year ended Year ended
GBP millions 31 July 2022 31 July 2021 31 January 2022
Net surplus in schemes at beginning of period 410 359 359
Current service cost (6) (6) (14)
Administration costs (2) (2) (3)
Net interest income 6 4 8
Net remeasurement (losses)/gains (14) (12) 21
Contributions paid by employer 13 13 30
Exchange differences (1) 5 9
----------------------------------------------- ---------------- ---------------- ----------------
Net surplus in schemes at end of period 406 361 410
----------------------------------------------- ---------------- ---------------- ----------------
UK 542 506 540
Overseas (136) (145) (130)
----------------------------------------- ------ ------ ------
Net surplus in schemes at end of period 406 361 410
----------------------------------------- ------ ------ ------
Present value of defined benefit obligations (2,408) (3,310) (3,084)
Fair value of scheme assets 2,814 3,671 3,494
---------------------------------------------- -------- -------- --------
Net surplus in schemes at end of period 406 361 410
---------------------------------------------- -------- -------- --------
The assumptions used in calculating the costs and obligations of
the Group's defined benefit pension schemes are set by the
Directors after consultation with independent professionally
qualified actuaries. The assumptions are based on the conditions at
the time and changes in these assumptions can lead to significant
movements in the estimated obligations, as illustrated in the
sensitivity analysis provided in note 28 of the annual financial
statements for the year ended 31 January 2022.
A full actuarial valuation of the scheme is carried out every
three years by an independent actuary for the Trustee and the last
full valuation was carried out as at 31 March 2019 with the next
valuation currently ongoing.
A key assumption in valuing the pension obligation is the
discount rate. Accounting standards require this to be set based on
market yields on high quality corporate bonds at the balance sheet
date. The UK scheme discount rate is derived using a single
equivalent discount rate approach, based on the yields available on
a portfolio of high-quality Sterling corporate bonds with the same
duration as that of the scheme liabilities.
The principal financial assumptions for the UK scheme, being the
Group's principal defined benefit scheme, are set out below:
At At At
Annual % rate 31 July 2022 31 July 2021 31 January 2022
----------------- ------------- ------------- ----------------
Discount rate 3.4 1.6 2.2
Price inflation 3.3 3.2 3.5
----------------- ------------- ------------- ----------------
12. Financial instruments
The Group holds the following derivative financial instruments
at fair value:
At At At
GBP millions 31 July 2022 31 July 2021 31 January 2022
---------------------------- ------------- ------------- ----------------
Foreign exchange contracts 84 11 38
---------------------------- ------------- ------------- ----------------
Derivative assets 84 11 38
---------------------------- ------------- ------------- ----------------
At At At
GBP millions 31 July 2022 31 July 2021 31 January 2022
------------------------------------ ------------- ------------- ----------------
Cross currency interest rate swaps - (2) -
Foreign exchange contracts (13) (25) (13)
------------------------------------ ------------- ------------- ----------------
Derivative liabilities (13) (27) (13)
------------------------------------ ------------- ------------- ----------------
The fair values are calculated by discounting future cash flows
arising from the instruments and adjusted for credit risk. These
fair value measurements are all made using observable market rates
of interest, foreign exchange and credit risk. All the derivatives
held by the Group at fair value are considered to have fair values
determined by level 2 inputs as defined by the fair value hierarchy
of IFRS 13, 'Fair value measurement', representing significant
observable inputs other than quoted prices in active markets for
identical assets or liabilities. There are no non-recurring fair
value measurements nor have there been any transfers of assets or
liabilities between levels of the fair value hierarchy.
Except as detailed in the following table of borrowings, the
carrying amounts of financial instruments (excluding lease
liabilities) recorded at amortised cost in the financial statements
are approximately equal to their fair values. Where available,
market values have been used to determine the fair values of
borrowings. Where market values are not available or are not
reliable, fair values have been calculated by discounting cash
flows at prevailing interest and foreign exchange rates. This has
resulted in level 2 inputs for borrowings as defined by the IFRS 13
fair value hierarchy.
Carrying amount
At At At
GBP millions 31 July 2022 31 July 2021 31 January 2022
----------------- -------------- -------------- -----------------
Bank overdrafts 17 19 14
Bank loans 1 3 2
Fixed term debt - 91 -
----------------- -------------- -------------- -----------------
Borrowings 18 113 16
----------------- -------------- -------------- -----------------
Fair value
-------------- -------------- -----------------
At At At
GBP millions 31 July 2022 31 July 2021 31 January 2022
----------------- -------------- -------------- -----------------
Bank overdrafts 17 19 14
Bank loans 1 3 3
Fixed term debt - 93 -
----------------- -------------- -------------- -----------------
Borrowings 18 115 17
----------------- -------------- -------------- -----------------
Cash and borrowings balances at 31 July 2022, 31 July 2021 and
31 January 2022 reflect the grossing up of cash and overdraft
balances subject to the Group's cash pooling arrangements to ensure
the Group's presentation of these balances is in line with the
requirements for offsetting in accordance with IAS 32.
As at 31 July 2022, the Group had an undrawn revolving credit
facility (RCF) of GBP550m due to expire in May 2025 (2021/22:
GBP550m RCF due to expire in May 2024). As at 31 January 2022, the
Group had an undrawn RCF of GBP550m due to expire in May 2024.
13. Share Capital
Number of ordinary shares Ordinary share capital
millions GBP millions
Allotted, called up and fully paid:
At 1 February 2022 2,066 325
New shares issued under share schemes 1 -
Purchase of own shares for cancellation (82) (13)
----------------------------------------- -------------------------- -----------------------
At 31 July 2022 1,985 312
----------------------------------------- -------------------------- -----------------------
At 1 February 2021 2,111 332
At 31 July 2021 2,111 332
----------------------------------------- -------------------------- -----------------------
At 1 February 2021 2,111 332
New shares issued under share schemes 2 -
Purchase of own shares for cancellation (47) (7)
----------------------------------------- -------------------------- -----------------------
At 31 January 2022 2,066 325
----------------------------------------- -------------------------- -----------------------
Ordinary shares have a par value of 155/(7) pence per share and
carry full voting, dividend and capital distribution rights.
During the half-year the Group purchased 82 million of the
Company's own shares for cancellation at a cost of GBP218m as part
of its capital returns programme.
14. Other reserves
Half year ended 31 July 2022
----------------------------------------------------------------
Cash flow
GBP millions Translation reserve hedge reserve Other Total
-------------------------------------------------- -------------------- ------------------------ ------ --------
At 1 February 2022 10 27 159 196
--------------------------------------- ------------------------------- ------------------------ ------ --------
Inventory cash flow hedges - fair
value gains - 113 - 113
Tax on items that will not be reclassified
subsequently to profit or loss - (28) - (28)
Currency translation differences
Group (22) - - (22)
Joint ventures and associates (1) - - (1)
Other comprehensive (expense)/income for the
period (23) 85 - 62
Inventory cash flow hedges - gains transferred to
inventories - (61) - (61)
Tax on equity items (1) 15 - 14
-------------------------------------------------- -------------------- ------------------------ ------ --------
At 31 July 2022 (14) 66 159 211
-------------------------------------------------- -------------------- ------------------------ ------ --------
Half year ended 31 July 2021
----------------------------------------------------------------
Cash flow
GBP millions Translation reserve hedge reserve Other Total
-------------------------------------------------- -------------------- ------------------------ ------ --------
At 1 February 2021 234 (32) 159 361
-------------------------------------------------- -------------------- ------------------------ ------ --------
Inventory cash flow hedges - fair value gains - 6 - 6
Tax on items that will not be reclassified
subsequently to profit or loss - (2) - (2)
Currency translation differences
Group (148) - - (148)
Joint ventures and associates (2) - - (2)
Other cash flow hedges
Fair value gains - 4 - 4
Gains transferred to income statement - (4) - (4)
Other comprehensive (expense)/income for the
period (150) 4 - (146)
Inventory cash flow hedges - losses transferred
to inventories - 34 - 34
Tax on equity items - (8) - (8)
-------------------------------------------------- -------------------- ------------------------ ------ --------
At 31 July 2021 84 (2) 159 241
-------------------------------------------------- -------------------- ------------------------ ------ --------
Year ended 31 January 2022
----------------------------------------------------------------
GBP millions Translation reserve Cash flow hedge reserve Other Total
-------------------------------------------------- -------------------- ------------------------ ------ --------
At 1 February 2021 234 (32) 159 361
-------------------------------------------------- -------------------- ------------------------ ------ --------
Inventory cash flow hedges - fair value gains - 59 - 59
Tax on items that will not be reclassified
subsequently to profit or loss - (13) - (13)
Currency translation differences
Group (218) - - (218)
Joint ventures and associates (7) - - (7)
Other cash flow hedges
Fair value gains - 1 - 1
Gains transferred to income statement - (1) - (1)
Other comprehensive (expense)/income for the year (225) 46 - (179)
Inventory cash flow hedges - losses transferred
to inventories - 16 - 16
Tax on equity items 1 (3) - (2)
-------------------------------------------------- -------------------- ------------------------ ------ --------
At 31 January 2022 10 27 159 196
-------------------------------------------------- -------------------- ------------------------ ------ --------
15. Cash generated by operations
Half year ended Half year ended Year ended
GBP millions 31 July 2022 31 July 2021 31 January 2022
--------------------------------------------------------------- ---------------- ---------------- -----------------
Operating profit 531 747 1,144
Share of post-tax results of joint ventures and associates (5) (1) (5)
Depreciation and amortisation 282 273 555
Net impairment charges/(reversals) - 2 (31)
(Gain)/loss on disposal of property, plant and equipment,
investment property, assets held
for sale and intangible assets - (1) 1
Lease gains (2) - (1)
Share-based compensation charge 11 14 27
Increase in inventories (395) (303) (359)
Increase in trade and other receivables (59) (33) (23)
Increase in trade and other payables 231 487 158
Movement in provisions (5) (19) (42)
Movement in post-employment benefits (5) (5) (13)
--------------------------------------------------------------- ---------------- ---------------- -----------------
Cash generated by operations 584 1,161 1,411
--------------------------------------------------------------- ---------------- ---------------- -----------------
16. Net debt
At At At
GBP millions 31 July 2022 31 July 2021 31 January 2022
----------------------------------------------------------------- -------------- ---------------- -----------------
Cash and cash equivalents 496 1,535 823
Bank overdrafts (17) (19) (14)
----------------------------------------------------------------- -------------- ---------------- -----------------
Cash and cash equivalents and bank overdrafts 479 1,516 809
Bank loans (1) (3) (2)
Fixed term debt - (91) -
Lease liabilities (2,318) (2,319) (2,376)
Net financing derivatives (8) (11) (3)
----------------------------------------------------------------- -------------- ---------------- -----------------
Net debt (1,848) (908) (1,572)
----------------------------------------------------------------- -------------- ---------------- -----------------
Half year ended Half year ended Year ended
GBP millions 31 July 2022 31 July 2021 31 January 2022
------------------------------------------------------------- ------------------ ---------------- -----------------
Net debt at beginning of period (1,572) (1,394) (1,394)
------------------------------------------------------------- ------------------ ---------------- -----------------
Net (decrease)/increase in cash and cash equivalents and
bank overdrafts (329) 444 (237)
Repayment of bank loans - 3 2
Repayment of fixed term debt - - 95
Net cash flow (329) 447 (140)
Movements in lease liabilities 57 78 7
Exchange differences and other non-cash movements (4) (39) (45)
------------------------------------------------------------- ------------------ ---------------- -----------------
Net debt at end of period (1,848) (908) (1,572)
------------------------------------------------------------- ------------------ ---------------- -----------------
17. Contingent liabilities
The Group is subject to claims and litigation arising in the
ordinary course of business and provision is made where liabilities
are considered likely to arise on the basis of current information
and legal advice.
The Group files tax returns in many jurisdictions around the
world and at any one time is subject to periodic tax audits in the
ordinary course of its business. Applicable tax laws and
regulations are subject to differing interpretations and the
resolution of a final tax position can take several years to
complete. Where it is considered that future tax liabilities are
more likely than not to arise, an appropriate provision is
recognised in the financial statements.
In October 2017, the European Commission opened a state aid
investigation into the Group Financing Exemption section of the UK
controlled foreign company rules. While the Group has complied with
the requirements of UK tax law in force at the time, in April 2019
the European Commission concluded that aspects of the UK controlled
foreign company regime partially constitute illegal state aid. In
January 2021, the Group received a charging notice from HM Revenue
& Customs for GBP57m, which was paid in February 2021, with a
further GBP7m interest paid in April 2021.
The UK Government and the Group, along with other UK-based
multinational groups, appealed the European Commission decision to
the European Courts. On 8 June 2022, the General Court of the
European Union dismissed several of those appeals, including the UK
Government's. It is expected that this decision will be appealed to
the European Court of Justice.
The final impact on the Group remains uncertain but, based upon
advice taken, the Group continues to consider that the amount paid
of GBP64m, which is included in non-current assets, will ultimately
be recovered.
Whilst the procedures that must be followed to resolve these
types of tax issues make it likely that it will be some years
before the eventual outcome is known, the Group does not currently
expect the outcome of these contingent liabilities to have a
material effect on the Group's financial position.
18. Related party transactions
The Group's significant related parties are its joint venture,
associate and pension schemes as disclosed in note 38 of the annual
financial statements for the year ended 31 January 2022. There have
been no significant changes in related parties or related party
transactions in the period.
19. Post balance sheet events
During the period since the balance sheet date, the Group
purchased 25 million of the Company's own shares for cancellation
at a cost of GBP60m. This amount was deducted from equity in the
half-year to 31 July 2022 as a result of an irrevocable buyback
agreement which was in place at 31 July 2022.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors confirm that the condensed interim financial
statements have been prepared in accordance with United Kingdom
adopted International Accounting Standard 34, "Interim Financial
Reporting", and that the Interim Results includes a fair review of
the information required by DTR 4.2.7 and DTR 4.2.8, namely:
-- an indication of important events that have occurred during
the period and their impact on the interim condensed financial
statements, and a description of the principal risks and
uncertainties for the remainder of the financial year; and
-- material related party transactions in the period and any
material changes in the related party transactions described in the
last annual report.
The Directors of Kingfisher plc were listed in the Group's
2021/22 Annual Report and Accounts. Bill Lennie joined the Board as
a non-executive Director on 1 May 2022. A list of current Directors
is maintained on the Kingfisher plc website which can be found at
www.kingfisher.com .
By order of the Board
Thierry Garnier Bernard Bot
Chief Executive Officer Chief Financial Officer
19 September 2022 19 September 2022
INDEPENDENT REVIEW REPORT TO KINGFISHER PLC
Conclusion
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 31 July 2022 which comprises the condensed income
statement, the condensed statement of comprehensive income, the
condensed statement of changes in equity, the condensed balance
sheet, the condensed cash flow statement and related notes 1 to
19.
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 31
July 2022 is not prepared, in all material respects, in accordance
with United Kingdom adopted International Accounting Standard 34
and the Disclosure Guidance and Transparency Rules of the United
Kingdom's Financial Conduct Authority.
Basis for Conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410 "Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity" issued by the Financial Reporting Council for use in the
United Kingdom (ISRE (UK) 2410). A review of interim financial
information consists of making inquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with
International Standards on Auditing (UK) and consequently does not
enable us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit.
Accordingly, we do not express an audit opinion.
As disclosed in note 2, the annual financial statements of the
group are prepared in accordance with United Kingdom adopted
international accounting standards and International Financial
Reporting Standards as issued by the IASB. The condensed set of
financial statements included in this half-yearly financial report
has been prepared in accordance with United Kingdom adopted
International Accounting Standard 34, "Interim Financial
Reporting".
Conclusion Relating to Going Concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
Conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This Conclusion is based on the review procedures performed in
accordance with ISRE (UK) 2410; however future events or conditions
may cause the entity to cease to continue as a going concern.
Responsibilities of the directors
The directors are responsible for preparing the half-yearly
financial report in accordance with the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct
Authority.
In preparing the half-yearly financial report, the directors are
responsible for assessing the group's ability to continue as a
going concern, disclosing as applicable, matters related to going
concern and using the going concern basis of accounting unless the
directors either intend to liquidate the company or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial
information
In reviewing the half-yearly financial report, we are
responsible for expressing to the company a conclusion on the
condensed set of financial statements in the half-yearly financial
report. Our Conclusion, including our Conclusion Relating to Going
Concern, are based on procedures that are less extensive than audit
procedures, as described in the Basis for Conclusion paragraph of
this report.
Use of our report
This report is made solely to the company in accordance with
ISRE (UK) 2410. Our work has been undertaken so that we might state
to the company those matters we are required to state to it in an
independent review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility
to anyone other than the company, for our review work, for this
report, or for the conclusions we have formed.
Deloitte LLP
Statutory Auditor
London, United Kingdom
19 September 2022
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