Annual Results

17 March 2016

Ted Baker Plc

("Ted Baker", the "Group")

Annual Results for the 52 weeks ended 30 January 2016

Highlights:

· Group revenue up 17.7% (17.0% in constant currency) to £456.2m

· Retail sales up 13.5% (13.2% in constant currency) to £348.4m

o UK and Europe retail sales up 8.9% (10.7% in constant currency) to £252.5m

o US and Canada retail sales up 27.3% (20.6% in constant currency) to £80.6m

o E-commerce sales up 45.8% (44.7% in constant currency) to £53.5m

· Wholesale sales up 33.6% (31.2% in constant currency) to £107.7m

· Licence income up 23.3% to £14.4m

· Proposed final dividend of 34.6p bringing total dividend to 47.8p, an increase of 18.6%

· Freehold purchase of "The Ugly Brown Building" completed

· Agreement signed for the lease of a new distribution facility in the UK, which will serve as the Group's European Distribution Centre

Ray Kelvin CBE, Founder and Chief Executive, said:

"I am pleased to report another year of strong progress in Ted Baker's continued development as a global lifestyle brand. We have again traded very well - despite an uncertain backdrop in some of our markets - which is testament to the strength of the Ted Baker brand as well as our unwavering focus on quality, design and attention to detail.

We have further developed the brand's presence across international markets including first store openings in Amsterdam, Azerbaijan, Hawaii, Mexico and Qatar and we have new openings planned across our markets in the year ahead.

The Group is continuing to invest in its team and infrastructure to support Ted Baker's stability and long-term growth. This includes the purchase of our iconic Central London home at the Ugly Brown Building as well as investment in a new, state-of-the-art European distribution centre in the UK.

The strength and success of Ted Baker is underpinned by the skill, talent and 'pashion' of our global team. I would like to take this opportunity to thank all of my colleagues for their hard work and commitment during the year and we look forward with continued confidence as we further develop Ted Baker across the world."

www.tedbaker.com

www.tedbakerplc.com

Media images available for download at:

http://www.tedbakerplc.com/ted/en/mediacentre/imagelibrary

Notes to editors:

Ted Baker Plc - "No Ordinary Designer Label"

Ted Baker is a global lifestyle brand that operates through three main distribution channels: retail, which includes e-commerce; wholesale; and licensing, which includes territorial and product licences.

We distribute through our own and licensed retail outlets, leading department stores and selected independent stores in the UK and Europe, North America, the Middle East, Asia and Australasia.

The brand continues to go from strength to strength driven along in part by its unconventional approach to product and design. Never forgetting its roots as a shirt specialist but always with an eye on the future Ted is continuously innovating through its collections, store environments and now with digital and social media initiatives that foster a truly omni-channel view for its growing and highly engaged global audience. 

Ted Baker has 448 stores and concessions worldwide, comprising of 185 in the UK, 93 in Europe, 97 in the US and Canada, 64 in the Middle East and Asia and 9 in Australasia.

The brand offers a wide range of collections including: Menswear; Womenswear; Global; Phormal; Endurance; Accessories; Audio; Bedding; Childrenswear; Crockery; Eyewear; Footwear; Fragrance and Skinwear; Gifting and Stationery; Jewellery; Lingerie and Sleepwear; Luggage; Neckwear; Rugs; Suiting; Technical Accessories; Tiles; and Watches.

Strategic Report

Chairman's Statement

I am pleased to report another successful year in Ted Baker's development as a global lifestyle brand. For the 52 weeks ended 30 January 2016 (the "period") we delivered a strong performance across all channels and established territories, which resulted in a 17.7% (17.0% in constant currency) increase in Group revenue to £456.2m (2015: £387.6m) and an 18.6% increase in profit before tax and exceptional items to £58.7m (2015: £49.5m).

The retail division performed well, with sales up 13.5% (13.2% in constant currency) to £348.4m (2015: £306.9m) on an increase in average square footage of 7.5%. We saw a good performance across our established territories and we continue to invest and build brand awareness in our newer markets for the long-term development of the brand. We continued our geographic expansion with openings across the UK and Europe, North America and Asia. Our e-commerce business delivered another strong performance, with sales up 45.8% (44.7% in constant currency) to £53.5m (2015: £36.7m) as we benefit from continued investment in our platform. E-commerce sales now represent 15.4% of our retail sales (2015: 12.0%).

The wholesale division delivered a strong performance, with sales up 33.6% (31.2% in constant currency) to £107.7m (2015: £80.7m). This reflects a good performance from our UK wholesale business, which includes the supply of goods to our licensed stores and our export business, as well as a strong performance from our North American wholesale business.

Our territorial and product licences delivered good performances, as licence income increased by 23.3% to £14.4m (2015: £11.7m). During the period, our licence partners opened stores and concessions in Azerbaijan, Dubai, Kuwait, Mexico, Qatar, Saudi Arabia, Singapore, Taiwan and Thailand and our joint venture in Australasia opened two outlet stores. We launched new product licences in bedding, rugs and tiles, which were well received.

In January 2016, we completed the purchase of the freehold of Block B, Canal Reach, St Pancras Way, London, also known as The Ugly Brown Building and currently occupied by the Group as its head office, for £58.25m using a new term loan facility. The Ugly Brown Building has become an iconic building in a rapidly developing Central London location and is a very important ingredient of Ted Baker's history and unique personality. We are delighted to have secured our future in this excellent location. We are confident that this will help us preserve our culture and continue to attract and retain great talent. This acquisition also enables the Group to consider expansion as its operations continue to grow and provides certainty over operating costs whilst removing exposure to rising rent reviews.

In December 2015, we entered into an agreement for lease of a new state-of-the-art distribution facility in the UK. Once fully operational, it will serve as our European Distribution Centre, handling all operations for our Retail, Wholesale and e-commerce businesses across the UK and Europe and supporting our long-term growth strategy.

During the period, we successfully launched further phases of the Microsoft Dynamics AX business system, as planned. We will continue to roll out this system globally across the Group over the next year to enhance efficiency, streamline our operations and support the continued evolution of the business.

Financial Results

Group revenue for the period increased by 17.7% (17.0% in constant currency) to £456.2m (2015: £387.6m). The composite gross margin decreased to 59.9% (2015: 60.7%), as a result of a change in the mix of retail and wholesale sales.

Profit before tax and exceptional items increased by 18.6% to £58.7m (2015: £49.5m) and profit before tax increased by 20.3% to £58.7m (2015: £48.8m). Adjusted basic earnings per share, which exclude exceptional items, increased by 20.9% to 100.6p (2015: 83.2p) and basic earnings per share increased by 22.7% to 100.6p (2015: 82.0p).

There were no exceptional costs in the period, compared to £5.3m in the previous period which related to a legal dispute with a former insurer. There was no exceptional income for the period, compared to £4.7m in the previous period which comprised of £3.7m in relation to the early termination of a licence agreement and £1.0m relating to settlement of an intellectual property dispute.

The Group's net borrowing position at the end of the period was £84.6m (2015: £18.8m). This reflects the addition of a secured term loan of £60.0m (2015: £nil) to the Group's existing multi-currency revolving credit facility to finance the purchase of The Ugly Brown Building and other net debt of £24.6m (2015: £18.8m). The increase in other net debt reflects the on-going significant investment in capital expenditure during the period and increased working capital in line with the Group's growth.

Dividends

The Board is recommending a final dividend of 34.6p per share (2015: 29.0p), making a total for the year of 47.8p per share (2015: 40.3p per share), an increase of 18.6% on the prior period. Subject to approval by shareholders at the Annual General Meeting to be held on 14 June 2016, the final dividend will be paid on 17 June 2016 to shareholders on the register on 20 May 2016.

People

I would like to take this opportunity to thank all of my colleagues across the world for their continued hard work and commitment. The Group's strong performance is dependent on our talented teams, whose creativity and passion are key to our success as we continue to grow the business and further develop Ted Baker as a global lifestyle brand.

Current Trading and Outlook

We are pleased by the initial reaction to our Spring/Summer collections, which has been positive. Trading is in line with our expectations, with the exception of Asia, where, as has been widely reported, the trading environment continues to be challenging. Whilst Asia currently represents a small part of our business at 3.4% of revenue, we remain positive about the long term opportunities to develop the brand in this territory.

Further store openings are planned across new and established markets and we continue to develop and invest in our e-commerce business. In our newer markets, we continue to build brand awareness for the long-term development of the brand.

Retail

In the UK and Europe, we plan to open a new store in Paris, and further concessions in France, Germany and Spain during the year. We will continue to invest in our e-commerce sites to enhance the customer experience and enhance the local content provided to our European customers, including launching our first language specific website in Germany.

In North America, we remain focused on developing our presence and have opened a store in Seattle and plan to open a further five new stores, including two in New York and one in Calgary, Miami and Ottawa. We are also relocating our Dallas store.

In Asia, we remain focused on building brand awareness in this market where we are in the relatively early stages of investment. In line with our development strategy in this territory, we have opened another store in Beijing and we are opening further concessions in China and Japan.

Wholesale

We anticipate further growth across our wholesale businesses, which should result in low double digit sales growth in the coming year.

Licence Income

Our product and territorial licences continue to perform well, with further openings planned in Azerbaijan, Dubai, Egypt, Malaysia, Mexico, Saudi Arabia and Taiwan, along with our first store in Chile.

Group

The strength of the Ted Baker brand and collections support our confidence in the continued development of the brand and further growth of the business, however, we remain mindful of the economic and political uncertainties in some of our markets.

We will continue to ensure that costs and commitments are controlled. To deliver our expansion plans, capital expenditure in the new financial year is anticipated to be above the previous year at £45m as a result of the investment in the new distribution facility, further store openings and refurbishments, and the on-going investment in new systems across the business.

We intend to make our next interim management statement, covering trading since the start of the 2016-17 financial year, in mid-June 2016.

David Bernstein CBE

Non-Executive Chairman

17 March 2016

Business Model and Strategy

Ted Baker is a global lifestyle brand that operates through three main distribution channels: retail, which includes e-commerce; wholesale; and licensing, which includes territorial and product licences.

The brand has grown steadily from its origins as a single shirt specialist store in Glasgow to the global lifestyle brand it is today. We distribute through our own and licensed retail stores, leading department stores and selected independent stores in the UK and Europe, North America, the Middle East, Asia and Australasia.

We offer a wide range of collections including: Menswear; Womenswear; Global; Phormal; Endurance; Accessories; Audio; Bedding; Childrenswear; Crockery; Eyewear; Footwear; Fragrance and Skinwear; Gifting and Stationery; Jewellery; Lingerie and Sleepwear; Luggage; Neckwear; Rugs; Suiting; Technical Accessories; Tiles; and Watches.

Our strategy is to further our position as a leading global lifestyle brand, based on three main elements:

· considered expansion of the Ted Baker collections. We review our collections continually to ensure we anticipate and react to trends and meet our customers' expectations. In addition, we look for opportunities to extend the breadth of collections and enhance our offer;

· controlled distribution through three main channels: retail; wholesale; and licensing. We consider each new opportunity to ensure it is right for the brand and will deliver margin led growth; and

· carefully managed development of overseas markets. We continue to manage growth in existing territories while considering new territories for expansion.

Underlying our strategy is an emphasis on design, product quality and attention to detail which is delivered by the passion, commitment and skill of our teams, licence partners and wholesale customers (our "trustees").

Key Performance Indicators

We review the on-going performance of the business using key performance indicators for our global business and each of our distribution channels.

The KPIs have been detailed below and considered throughout the Strategic Report.

*Operating contribution is defined as operating profit before exceptional items as a percentage of revenue

**Excludes licensed partner stores

*** Excludes online sales

**** Operating cashflow per share is defined as net cash generated from operating activities divided by the weighted number of ordinary shares (diluted)

***** Working capital comprises inventories, trade and other receivables and trade and other payables

Business Review

Global Group Performance

Retail

Ted Baker operates stores and concessions across the UK, Europe, North America and Asia and an e-commerce business based in the UK, primarily serving the UK and Europe, with separate US and Canadian sites dedicated to North America, and a separate site serving Australia. We also have e-commerce businesses with some of our concession partners.

The retail division performed well, with sales up 13.5% (13.2% in constant currency) to £348.4m (2015: £306.9m). Average retail square footage rose by 7.5% over the period to 357,096 sq ft (2015: 332,089 sq ft). Total retail square footage at 30 January 2016 was 377,830 sq ft (2015: 344,898 sq ft), an increase of 9.5% on the prior year. Retail sales per square foot rose 1.5% (1.3% in constant currency) from £814 to £826.

Our e-commerce business delivered another strong performance with sales increasing by 45.8% (44.7% in constant currency) to £53.5m (2015: £36.7m) driven by growth across our e-commerce business. We continue to invest in each of our UK, USA, Canadian and Rest Of World sites, aiming to provide a more relevant customer experience through improved design, performance and personalised content.

The retail gross margin reduced slightly to 64.8% (2015: 65.5%), largely reflecting an increase in our outlet sales as a proportion of total sales. Retail operating costs increased 13.9% in line with our expectations, to £163.5m (2015: £143.5m) and as a percentage of retail sales, increased slightly to 46.9% (2015: 46.8%).

Wholesale

Our wholesale business in the UK serves countries across the world, particularly in the UK and Europe, as well as supplying products to stores operated by our territorial licence partners. In addition, we operate a wholesale business in North America serving the USA and Canada.

Group wholesale sales increased by 33.6% (31.2% in constant currency) to £107.7m (2015: £80.7m), reflecting a good performance from both our UK wholesale business, with sales increasing by 20.2% to £78.0m (2015: £64.9m), and a strong performance from our North American wholesale business, with sales increasing by 94.1% (81.7% in constant currency) to £29.7m (2015: £15.3m) as the brand continues to gain traction.

The wholesale gross margin increased to 43.8% (2015: 42.4%), which was principally the result of a greater proportion of wholesale sales to our trustee partners which carry a higher margin.

Licence income

We operate both territorial and product licences. Our territorial licences cover specific countries in Asia, Australasia, Europe, the Middle East and North America, where our partners operate licensed retail stores and, in some territories, wholesale operations.

Our product licences cover Audio, Bedding, Childrenswear, Crockery, Eyewear, Footwear, Fragrance and Skinwear, Gifting and Stationery, Jewellery, Lingerie and Sleepwear, Luggage, Neckwear, Rugs, Suiting, Technical Accessories, Tiles, and Watches.

Both territorial and product licences delivered good performances, with licence income up 23.3% to £14.4m (2015: £11.7m). There were notable performances from our product licensees in childrenswear, footwear, eyewear, homeware, skinwear and suiting.

In October, we opened our first concessions in Mexico with our new licence partner Multimoda and we are encouraged by performance to date. Our licensed stores in Saudi Arabia, operated by our territorial partner, RSH Limited, also performed particularly well during the period.

Collections

Ted Baker Womenswear delivered a good performance with sales up 15.9% to £254.1m (2015: £219.3m). Womenswear represented 55.7% of total sales (2015: 56.6%).

Ted Baker Menswear performed well with sales up 20.1% to £202.1m (2015: £168.3m). Menswear represented 44.3% of total sales in the period (2015: 43.4%).

Geographic Performance

United Kingdom and Europe

* Excludes licensed partner stores

** Excludes online sales

Sales in our UK and Europe retail division were up 8.9% to £252.5m (2015: £231.8m) (10.7% in constant currency), reflecting a good performance in our established UK market and a very good performance in continental Europe where we continue to expand.

In the UK, we opened new stores during the year in London Spitalfields and Stansted Airport along with three new concessions with our UK concession partners. We closed our accessories store in Gatwick Airport and our store in Richmond along with one other concession. Our European expansion continued as we opened our first store in the Netherlands, in Amsterdam, and our first outlet in Spain, in Barcelona. We also opened further concessions with premium department stores in France, Germany, Ireland, the Netherlands and Spain. We are pleased with their performances and remain confident about growth opportunities for the brand in these markets.

Our e-commerce business performed very well during the period with sales increasing by 40.5% to £46.8m (2015: £33.3m), primarily reflecting continuing growth in the UK.

Sales from our UK wholesale division increased by 20.2% to £78.0m (2015: £64.9m) reflecting strong sales of product to our licence partners, and continued growth in our wholesale export business.

North America

* Excludes licensed partner stores

** Excluding online sales

We continue to be very pleased with our progress across the retail and wholesale channels in North America, both of which performed very well. We are confident that the Ted Baker brand is becoming more established and continuing to gain recognition in this territory.

Sales from our retail division in North America increased by 27.3% to £80.6m (2015: £63.3m) (20.6% in constant currency). During the period, we continued our expansion with new stores in Hawaii, Malibu, Toronto and Vancouver, and outlets in Florida (two outlets), Los Angeles, San Francisco and seven further concessions through a leading department store. We also opened six concessions in Mexico with our licence partner.

Our US and Canadian e-commerce businesses delivered strong performances with sales increasing 91.4% to £6.6m (77.8% in constant currency).

Sales from our North American wholesale business increased by 94.1% to £29.7m (2015: £15.3m) (81.7% in constant currency) reflecting further growth of our business as the brand continues to gain traction.

Middle East, Asia and Australasia

* Excludes licensed partner stores

We continue to develop the Ted Baker brand across Asia, Australasia and the Middle East through our retail and territorial licence channels.

In Asia, we remain encouraged by reactions to the brand and are positive about the long term opportunities in this territory; however, as has been widely reported, the trading environment continues to be challenging. Retail sales in Asia increased 30.5% to £15.4m (2015: £11.8m) (24.1% in constant currency). In Hong Kong, we opened our first street side store. In China, we opened a further concession. In South Korea, we opened an outlet store and one concession and closed one concession.

During the period, our Middle East licence partners performed particularly well and opened three further stores in Saudi Arabia and one store in each of Dubai, Azerbaijan, Qatar and a concession in each of Dubai and Kuwait. Our South East Asia licence partners opened two stores in Singapore, one store in Taiwan, one store in Thailand, two new concessions in Taiwan and closed one concession in Taiwan. As at 30 January 2016, our licence partners operated 45 stores and concessions across the Middle East and South East Asia (2015: 34).

The joint venture with our Australasian licence partner, Flair Industries Pty Ltd continued to perform well. During the period, we opened new outlet stores in Sydney and Melbourne. As at 30 January 2016, we operated 9 stores in Australasia (2015: 7 stores).

Financial Review

Revenue and Gross Margin

Group revenue increased by 17.7% (17.0% in constant currency) to £456.2m (2015: £387.6m), driven by a 13.5% (13.2% in constant currency) increase in retail sales to £348.4m (2015: £306.9m) and a 33.6% (31.2% in constant currency) increase in wholesale sales to £107.7m (2015: £80.7m).

The composite gross margin for the Group decreased to 59.9% (2015: 60.7%) mainly as a result of a change in sales mix between wholesale and retail sales.

Operating Expenses Pre-Exceptional items

Distribution costs increased by 17.4% in line with our expectations to £169.8m (2015: £144.6m) and as a percentage of sales slightly decreased to 37.2% (2015: 37.3%).

Administration expenses increased by 12.5% to £57.4m (2015: £51.0m). Excluding the employee performance related bonus of £2.7m (2015: £4.9m), administration expenses rose by 18.7% due to our growth in central functions, both in the UK and overseas, and the continued deployment of our distribution and information technology infrastructures to support our growth.

Profit Before Tax

Profit before tax and exceptional items increased by 18.6% to £58.7m (2015: £49.5m) and profit before tax increased by 20.3% to £58.7m (2015: £48.8m).

Exceptional items

There were no exceptional costs or income during the period.

The prior year's exceptional income of £4.7m comprised £3.7m in relation to the early termination of a licence partner agreement and £1.0m in relation to the settlement of an intellectual property dispute. The prior year's exceptional costs of £5.3m related to a legal dispute with a previous insurer.

Finance Income and Expenses

Net finance costs during the period were £1.4m (2015: £1.2m). This increase reflects higher Group borrowing compared to the prior year as a result of an increase in the on-going significant investment in capital expenditure and increased working capital to support our long-term expansion.

The net foreign exchange loss during the year was £nil (2015: net loss of £0.3m).

Taxation

The Group tax charge for the year was £14.4m (2015: £12.9m), an effective tax rate of 24.6% (2015: 26.5%). This effective tax rate is higher than the UK tax rate for the period of 20.16% largely due to higher overseas tax rates and the non-recognition of losses in overseas territories where the businesses are still in their development phase. On 1 April 2015, the UK corporation tax rate fell from 21% to 20% and further reductions to 19% from 1 April 2017 and to 18% from 1 April 2020 have been substantively enacted. The Budget on 16 March 2016 announced that there will be a further cut in the corporation tax rate to 17% from 1 April 2020.

Our closing UK deferred tax assets and liabilities have been measured at 19% based on the corporation tax rate at which they are anticipated to unwind and overseas deferred tax assets and liabilities have been measured at the applicable overseas tax rates.

Our future effective tax rate is expected to be higher than the UK tax rate as a result of overseas profits arising in jurisdictions with higher tax rates than the UK.

Cash Flow

The net decrease in cash and cash equivalents of £5.9m (2015: £10.1m decrease) primarily reflected an increase in working capital and further capital expenditure to support our long term development.

Total Group working capital, which comprises inventories, trade and other receivables and trade and other payables, increased by £22.6m to £113.5m (2015: £90.9m). This was mainly driven by an increase in inventories of £14.2m to £125.3m (2015: £111.1m) reflecting the growth of our business and stock on hand for our wholesale customers and licence partners. Working capital is further driven by an increase in trade and other receivables of £12.4m to £49.3m (2015: £36.9m) as a result of stronger wholesale sales.

Group capital expenditure amounted to £89.5m (2015: £25.7m) reflecting the purchase of The Ugly Brown Building for £58.0m, which was financed by the new term loan. Further capital expenditure relates to the opening and refurbishment of stores, concessions and outlets and investment in business wide systems to support our future growth.

The Group's net borrowing position at the end of the period was £84.6m (2015: £18.8m). The Group added a secured term loan of £60.0m (2015: £nil) to the Group's existing multi-currency revolving credit facility to finance the purchase of The Ugly Brown Building.

Shareholder Return

Basic earnings per share increased by 22.7% to 100.6p (2015: 82.0p). Adjusted earnings per share, which exclude net exceptional items, increased by 20.9% to 100.6p (2015: 83.2p).

The proposed final dividend of 34.6p per share will make a total for the period of 47.8p per share (2015: 40.3p per share), an increase of 18.6% on the previous year.

Operating cash flow per share, which is calculated using the net cash generated from operating activities, was 93.3p (2015: 68.7p) and reflected an increase in cash generated from operating activities.

Currency Management

The most significant exposure to foreign exchange fluctuation relates to purchases made in foreign currencies, principally the US Dollar and the Euro.

A proportion of the Group's purchases are hedged in accordance with the Group's risk management policy, typically 12 months in advance. The balance of purchases is hedged naturally as the business operates internationally and income is generated in the local currencies.

At the balance sheet date, the Group had hedged its projected commitments in respect of the year ending 28 January 2017.

Borrowing Facilities

In July 2015, the Group increased its borrowing facility to £85.0m (2015: £65.0m). The facility is a multi-currency revolving credit facility with The Royal Bank of Scotland and Barclays which is due to expire on 29 March 2018. The increase is a function of the growth in our business and is necessary to fund capital expenditure to support the Group's long term strategy.

In December 2015, the Group agreed a £60.0m secured term loan, in addition to the existing multi-currency revolving credit facility with The Royal Bank of Scotland and Barclays. The term loan is repayable over 5 years and the proceeds were used to finance the purchase of The Ugly Brown Building.

The facility and term loan contain appropriate financial covenants and are tested on a quarterly basis. The Group monitors actual and prospective compliance with these on a regular basis.

Principal Risks and Uncertainties

The Board is ultimately responsible for the Group's system of risk management and internal control and risk management systems and for reviewing their effectiveness. The Board confirms that there is an ongoing process for identifying, evaluating and managing the significant risks faced by the Group, which has been in place for the period and up to the date of approval of these financial statements, and that this process is regularly reviewed by the Board. However, such systems are designed to manage rather than eliminate the risk of failure to achieve business objectives, and can provide only reasonable and not absolute assurance against material misstatement or loss.

In order to help manage these risks and uncertainties, the Board has delegated responsibility for monitoring the effectiveness of the Group's systems of internal control and risk management methodology to the Audit Committee.

In addition, the Group has established a Risk Committee that includes the Finance Director and various members of the Executive Committee and heads of department. The Risk Committee reviews the risk management and control process in each key business area on an ongoing basis and considers:

• the authority, resources and co-ordination of those involved in the identification, assessment and management of significant risks faced by the Group;

• the response to the significant risks which have been identified by management and others;

• the maintenance of a controlled environment directed towards the proper management of risk; and

• the annual reporting procedures.

Having considered the key risks inherent in the business and the system of control necessary to manage such risks, the Finance Director of the Subsidiaries (the "Finance Director") presents the Risk Committee's findings to the Board on a regular basis. In addition, the Chief Executive reports to the Board on significant changes in the business and the external environment which affect significant risks.

The Board has reviewed the effectiveness of the system of risk management and internal control during the period. In particular, it has reviewed and updated the process for identifying and evaluating the significant risks affecting the business and the policies and procedures by which these risks are managed. Management is responsible for the identification and evaluation of significant risks applicable to their areas of the business together with the design and operation of suitable internal controls. These risks are assessed on a continual basis and may be associated with a variety of internal or external sources including control breakdowns, disruption in information systems, competition, natural catastrophe and regulatory requirements, and also by reference to the Group's five year strategic and financial plan.

The Group has an independent internal audit function whose findings are regularly reviewed by the Board and the Executive Committee. The Audit Committee monitors and reviews the effectiveness of the internal audit activities.

The Chief Operating Officer provides the Board with monthly financial information which includes key performance indicators.

The Board has carried out a robust assessment of the principal risks facing the Group, including those that would threaten its business model, future performance, solvency or liquidity. Although not exhaustive, the following list highlights some of the principal risks identified by the Group (which are not shown in order of importance):

Viability statement

In accordance with provision 2.2 of the UK Corporate Governance Code dated September 2014 (the "Code") the Directors have assessed the viability of the Group over a three year period, taking into account the Group's current position and the potential impact of the principal risks documented above.

The Group operates a five year plan, which is updated and reviewed annually by the Board. Within the five year plan, detailed scenario planning and stress testing has been carried out over a three year period. The Directors consider the three year period to 30 January 2019 to be the appropriate period to assess the viability and prospects of the Group with a high level of certainty, and also aligns with the typical borrowing period of the Group.

The Directors' assessment has been further enhanced by analysing the current and future risks, controls and assurances available, resulting in a clear picture of the risk profile across the whole business. The principal risks that could affect the future viability of the Group over the next three years are identified in the Principal Risks and Uncertainties section.

In making this assessment the Directors have considered the resilience of the Group to the occurrence of these risks in severe but plausible scenarios, taking into account the effectiveness of any mitigating actions. In addition, the Board has considered the impact on the Group's cash flows, headroom, covenants and other key financial ratios having stress tested the potential impact of these scenarios, both individually and in combination.

Sensitivity analysis was also used to stress test the Group's strategic plan and to confirm that sufficient headroom would remain available under the Group's credit facilities. The Board considers that under each scenario tested the mitigating actions would be effective and sufficient to ensure the continued viability of the Group. For the reasons stated above, based on the robust assessment undertaken, the Directors confirm they have a reasonable expectation that the Group will be able to continue in operation, and meet its liabilities as they fall due, over the period of assessment.

The Strategic Report was approved by the Board of Directors on 17 March 2016 and signed on its behalf by:

Charles Anderson

Company Secretary

Registered Office: The Ugly Brown Building, 6a St. Pancras Way, London NW1 0TB

Company No: 03393836

Group Statement of Changes in Equity

For the 53 weeks ended 31 January 2015

Company Statement of Changes in Equity

For the 52 weeks ended 30 January 2016

Company Statement of Changes in Equity

For the 53 weeks ended 31 January 2015

Group and Company Balance Sheet

At 30 January 2016

These financial statements were approved by the Board of Directors on 17 March 2016 and were signed on its behalf by:

L D Page

Director

Group and Company Cash Flow Statement

For the 52 weeks ended 30 January 2016

Notes to the Financial Statements

Basis of preparation

EU law (IAS Regulation EC 1606/2002) requires that the Group financial statements, for the 52 weeks ended 30

January 2016 are prepared in accordance with International Financial Reporting Standards (IFRSs) adopted for use in the EU ("adopted IFRSs").

This financial information has been prepared on the basis of the recognition and measurement requirements of adopted IFRSs as at 30 January 2016. The financial information set out above does not constitute the Group's statutory accounts for the 52 weeks ended 30 January 2016 or 53 weeks ended 31 January 2015. The annual financial information presented in this annual results announcement for the 52 weeks ended 30 January 2016 is based on, and is consistent with, that in the Group's audited financial statements for the 52 weeks ended 30 January 2016, and those financial statements will be delivered in May 2016. The auditor's report on those financial statements is unqualified and does not contain any statement under Section 498 (2) or (3) of the Companies Act 2006.

Statutory accounts for 31 January 2015 have been delivered to the Registrar of Companies. The auditor has reported on those accounts; their reports were i) unqualified and, ii) did not contain statements under Section 498 (2) or (3) of the Companies Act 2006.

Going concern

The Group's business activities, together with the factors likely to affect its future development, performance and position are set out on pages 3 to 12. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the Chairman's Statement on pages 3 to 5. In addition the financial statements includes the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk.

The Company meets its day-to-day working capital requirements through a committed overdraft facility expiring on 29 March 2018 which is multi-currency revolving facility with the Royal Bank of Scotland and Barclays. The facility will be used to the extent necessary to fund capital expenditure to support the Group's growth strategy.

The Group's forecasts and projections, taking into account reasonably possible changes in trading performance, show that the Group has sufficient financial resources. As a consequence the Directors have a reasonable expectation that the Company and the Group are well placed to manage their business risks and to continue in operational existence for the twelve months from the date of signing these financial statements. Accordingly, the Directors continue to adopt the going concern basis in preparing the consolidated financial statements.

Non-GAAP performance measures

The directors believe that the profit before exceptional items and adjusted earnings per share measures provide additional useful information for shareholders on the underlying performance of the business. These measures are consistent with how underlying business performance is measured internally.

The exceptional profit before tax measure is not a recognised profit measure under IFRS and may not be directly comparable with adjusted profit measures used by other companies.

There were no exceptional items in the current year.

Exceptional items in the prior year include:

· costs in relation to a legal dispute with a previous insurer;

· income for an early termination of a licence partner agreement; and

· receipt for a settlement of an intellectual property dispute.

Significant accounting policies

Except as described below, the accounting policies applied by the Group in this annual results announcement are the same as those applied by the Group in its consolidated financial statements for the 53 weeks ended 31 January 2015.

There were no revisions to adopted IFRS that became applicable in the period which had a significant impact on the Group's financial statements.

IFRS 16, Leases, is not yet EU endorsed and has an effective date of 1 January 2019. Management will conduct a review of the impact this will have on the Group.

The Group does not consider that any other standards, amendments or interpretations issued by the IASB, but not yet applicable, will have a significant impact on the financial statements in future years.

2. Segment information

The Group has three reportable segments; retail, wholesale and licence income.

For each of the three segments, the Group's chief operating decision maker (the "Board") reviews internal management reports on a four weekly basis.

The accounting policies of the reportable segments are described in the Group's financial statements. Information regarding the results of each reportable segment is included below. Performance for the retail segment is measured based on operating contribution, whereas performance of the wholesale segment is measured based on gross profit and performance of the licence segment is measured based on royalty income, as included in the internal management reports that are reviewed by the Board.

Segment results before exceptional items are used to measure performance as management believes that such information is the most relevant in evaluating the performance of certain segments relative to other entities that operate within these industries. Inter-segment pricing is determined on an arm's length basis.

a) Segment revenue and segment result

Wholesale sales are shown after the elimination of inter-company sales of £65,535,811 (2015: £54,541,000)

b) Geographical information

*Non-current assets exclude deferred tax assets.

c) Revenue by collection

3. Profit before tax

*Disclosed above are the costs charged in the year relating to leasehold properties and concession arrangements. These are either fixed in nature or variable based on revenue levels for a particular store or concession, where relevant, excluding e-commerce sales with concession partners.

There were no amounts recognised as exceptional costs or income during the 52 weeks ended 30 January 2016.

Exceptional costs in the 53 weeks ended 31 January 2015 of £5.3m relate to a legal dispute with a previous insurer.

Exceptional income in the 53 weeks ended 31 January 2015 of £4.7m comprises £3.7m relating to the early termination of a licence partner agreement and £1.0m in relation to the settlement of an intellectual property dispute.

4. Finance income and expenses

5. Income tax expense

a) The tax charge comprises 

b) Deferred tax movement by type 

c) Factors affecting the tax charge for the period

The tax assessed for the period is higher than the tax calculated at domestic rates applicable to profits in the respective countries. The differences are explained below.