Half-year Report

4 December 2025

FRASERS GROUP PLC ("Frasers Group", "the Group", or "the Company")

Unaudited half year results for the 26 weeks ended 26 October 2025 ("FY26 H1")

A solid first half: Continued success of the Elevation Strategy with progress on margins, cost savings and international expansion, with tough market conditions continuing into the second half.

Michael Murray, Chief Executive of Frasers Group: 

"We've made a solid start to FY26 even though market conditions are tough, consumer confidence is very subdued and excess inventory continues to weigh on the industry, leading to increased promotional activity. While we remain cautious into the second half, our focus is unwavering as we confront these challenges head-on, and we are today re-iterating our FY26 APBT guidance of £550m to £600m. We are continuing to invest boldly in our Elevation Strategy-deepening brand partnerships, elevating our product mix, opening new Sports Direct stores internationally, and acquiring strategic properties to strengthen our portfolio. These steps reinforce our ambition and give us real confidence in the substantial long-term opportunities ahead for the Group."

Headlines

· Continued strategic progress against key priorities:

1. Focus on underlying profitable growth

· Revenue up 5.0% to £2,581.3m, driven by international revenue growth of 42.8%.

· APBT(1) decreased by 2.8% to £290.9m as an £82.3m increase in impairments of tangible and intangible fixed assets and an £11.3m increase in interest costs were largely offset by a £33.8m gain from the disposal of the Coventry Arena and a £41.1m increase in premiums from strategic investments.

· Group and retail gross margin % up 160bps year-on-year, driven by improved product and retail mix in both UK Sports (+140bps improvement) and Premium Lifestyle (+410bps improvement), as the core Sports Direct and Flannels businesses continue to grow as a proportion of group sales.

· Retail profit from trading up 12.2% to £411.4m.

· Green shoots in the luxury market as Flannels returned to sales growth. Premium Lifestyle's profit from trading up £5.2m (9.2%) to £61.5m.

· Disposed of the non-core, Coventry Arena business for £50m, generating a £33.8m gain on disposal.

· Basic EPS of 76.4p, an increase of 40.5p year-on-year, reflecting fair value gains on derivatives held in relation to strategic investments. Adjusted EPS (1) of 49.8p, a decrease of 1.2p (2.4%) in line with the reduction in APBT (1).

2. Elevation Strategy, best brands and international expansion

· Successfully completed acquisitions of Holdsport in South Africa, XXL in the Nordics and recently opened our first stores with partners in Malta, Australia and the Middle East as we continue to build a platform for global growth.

· Driving even stronger relationships with the biggest global brands, including with strategic brand partners Nike, Adidas and HUGO BOSS.

· Michael Murray appointed to the HUGO BOSS supervisory board in May 2025. Associate accounting for the Group's holdings in HUGO BOSS and Accent Group added £19.0m to APBT in FY26 H1.

· Further UK property investments at attractive yields to satisfy our occupational demand, with new shopping centres and retail park acquisitions including sites at Greenock and Almondvale. After period end, completed the £217.6m acquisition of Braehead retail park near Glasgow.

· Continue to invest in UK Sport, demonstrated by the opening of our biggest Sports Direct flagship store in Liverpool.

· Invested in The Webster, a leading luxury multi-brand retailer in the US, further strengthening our global brand partnerships.

3. Acquisition integrations and automation synergies

· Delivered £10.3m of underlying net cost-savings and synergy benefits despite significant increases in staff costs driven by increases to National Minimum Wage and Employers' National Insurance which came into effect in April 2025.

· Efforts under way to realise synergies from recent international acquisitions.

· As noted in our letter to the Unite Union General Secretary Sharon Graham on 3 October 2025, given the significant cost increases imposed on retail by the Labour government, it would be reckless and irresponsible for Unite to implement a strike whilst demanding further above inflation wage increases. We await the Union's response to our latest communication following a breakdown in talks and urge them not to repeat their previous politically motivated actions against the Group, noting Unite Assistant General Secretary Steve Turner's quote to us on 4 October 2016 that "It was the agencies we were after…we had to get to you in order to get to the agencies."

4. Frasers Plus

· Continued progress towards our long-term ambitions of delivering £1bn+ in sales, £600m in credit balances, a greater than 15% yield, and over 2 million active Frasers Plus customers (excluding any third-party partnerships). £154m of retail sales were made on credit in FY26 H1 (FY25 H1: £154m). The business ended FY26 H1 with 1.1m active customers (FY25 H1: 0.4m) and Frasers Plus accounted for 20.0% of UK online sales, compared to 13.7% in FY25 H1. Encouraging improvements seen in store uptake during FY26 H1, and StudioPay exit now complete.

5. Strong balance sheet and cash flow

· The Group's strategy is underpinned by a strong balance sheet with net assets increasing to £2,394.2m from £1,988.1m at FY25 and net assets per share increasing to £5.32 from £4.41 at FY25.

· Cash inflow from operating activities before working capital movements of £430.8m has enabled the Group to continue to invest in its retail proposition, international acquisitions, Frasers Plus, our property portfolio and strategic partnerships such as HUGO BOSS and Accent Group. Our holding in HUGO BOSS increased to 25.2% in FY26 H1, whilst we also increased our investment in Accent Group to 19.9%.

· Net debt excluding securitisation increased to £1,030.4m (£847.5m at FY25), reflecting capital expenditure, international acquisitions and strategic investments in FY26 H1.

· We secured a new £3.0bn Term Loan and Revolving Credit Facility in July 2025, replacing the previous £1.65bn arrangements, with options to extend the term up to a total of five years and increase the facility by a further £0.5bn. The facility currently stands at £3.1bn.

Outlook

The Group delivered a solid first half, driven by Sports Direct and strengthening margins in our Premium & Luxury division, particularly at Flannels. The consumer environment remains challenging, and although trading has improved compared to last year's Budget-affected period, it is still weaker than FY24, with excess inventory in the sector continuing to weigh on the wider market.

Despite this backdrop, our ambitions remain high. We are working hard to offset the £50m-plus incremental annual costs from last year's Budget through disciplined savings, synergies and efficiencies, and continue to expect FY26 APBT of £550m to £600m, including the expected loss from XXL ASA* and the first-time equity accounting of HUGO BOSS and Accent Group.

*Prior guidance, provided on July 17 2025, excluded the results of XXL ASA which was acquired on 27 June 2025.

Other notes

(1) This is an Alternative Performance Measure, for which the reconciliation to the equivalent GAAP measure is set out in note 3 to the financial information. Adjusted EPS is discussed in note 8.

(2) Restated to reflect the classification of the results of Game Spain and Coventry Arena as discontinued operations and the reclassification of delivery income and costs associated with free-issue gift vouchers from selling, distribution and administrative expenses to revenue. Please refer to note 1 of the financial information for further details.

Enquiries

Andrew Kasoulis

Investor Relations Director

E. [email protected]

T. 07826 532191

Kathleen Glover

Frasers Group PR

E. [email protected]

T. 07878 771 800

BUSINESS REVIEW

GROUP SUMMARY

APBT(2) decreased by 2.8% to £290.9m as an £82.3m increase in impairments of tangible and intangible fixed assets and an £11.3m increase in interest costs was largely offset by a £33.8m gain from the disposal of the Coventry Arena and a £41.1m increase in premiums from strategic investments. 

The current period result includes impairment charges totalling £47.1m (FY25 H1: £nil), primarily due to the write-off of intangible assets and goodwill assigned to the Everlast and Twinsport cash generating units, and the Matches intellectual property, as well as a net impairment charge of £20.7m (FY25 H1: £14.5m net impairment reversal) largely relating to two under-performing stores in the UK.

Share of profit/(loss) of associates includes £19.7m in respect of HUGO BOSS, Accent Group and Four (Holdings) Limited, offset by the write-off of the carrying value of investments in Kangol LLC (£16.9m) and X Channel Marketing Ltd (£1.0m).

Reported PBT of £412.1m, an increase of 97.2%. The year-on-year increase in reported PBT is largely the result of fair value gains on equity derivatives held in relation to strategic investments. The £120.5m fair value gain in FY26 H1 (FY25 H1: £64.0m fair value loss) primarily relates to an increase in the HUGO BOSS share price between April 2025 and October 2025 (FY25 H1: decline in share price between April 2024 and October 2024).

Retail revenue increased by 5.1%. In the UK, sales growth from Sports Direct and Flannels, reflecting the ongoing success of the Elevation Strategy and green shoots in the luxury market, was more than offset by planned declines in Game UK, Studio Retail, House of Fraser, and the businesses acquired from JD Sports. International revenue benefited from the acquisitions of Holdsport (completed in May 2025) and XXL (completed in June 2025), partially offset by the disposal of the MySale business in May 2025.

Group gross margin % increased to 47.3% from 45.7% due to an improved mix effect, as the lower margin % businesses reduce as a proportion of total revenue, and the higher margin Sports Direct and Flannels businesses continue to grow as a proportion of group sales. Flannels has increased its gross margin % through a more relevant product offering and improved inventory holding.

Basic EPS of 76.4p, an increase of 40.5p year-on-year, reflecting fair value gains on derivatives held in relation to strategic investments. Adjusted EPS (2) of 49.8p, a decrease of 1.2p (2.4%) in line with the reduction in APBT (2).

UK SPORTS

This segment includes the results of the Group's core sports retail store operations in the UK, plus all the Group's sports retail online business, other UK-based sports retail and wholesale operations, GAME UK stores and online operations, retail store operations in Northern Ireland, Frasers Fitness, Studio Retail's sales and the Group's central operating functions (including the Shirebrook campus).

UK Sports accounts for 51.5% (FY25 H1(1): 57.2%) of the Group's revenue.

Revenue decreased by 5.8%. Continued sales growth from Sports Direct reflecting the ongoing success of the Elevation Strategy and strengthening brand relationships, was more than offset by planned declines in Game UK and Studio Retail.

Gross profit decreased by £18.6m as a result of the sales decline but gross margin % increased by +140 bps to 48.3% reflecting the fact that the higher margin Sports Direct business now makes up a greater proportion of this segment.

Operating costs reduced by £11.8m as the benefits of integrating and right-sizing the lower margin businesses were realised, although the savings were largely offset by increases to National Minimum Wage and Employers' National Insurance.

As a result of the above, the segment's profit from trading declined by £6.8m year-on-year.

UK Sports' operating profit result of £168.3m (FY25 H1: £190.0m) includes impairment charges of £18.0m (FY25 H1: impairment reversals of £5.5m), which reflects the write-down of the carrying value of the Matches intellectual property and brands, and realised foreign exchange losses of £8.8m (FY25 H1: £4.4m).

Store numbers increased slightly from 782 to 791 mainly driven by the replacement of standalone Game stores with Game concessions situated inside larger Sports Direct stores.

PREMIUM LIFESTYLE

This segment includes the results of the Group's premium and luxury retail businesses FLANNELS, Cruise, Van Mildert, Jack Wills, House of Fraser & Frasers, Gieves and Hawkes, and Sofa.com along with the related websites, the businesses acquired from JD Sports, as well as the results from the I Saw it First website.

Premium Lifestyle accounts for 17.2% (FY25 H1 (1): 18.8%) of the Group's revenue.  

Revenue decreased by 3.7% as growth in Flannels was more than offset by the impact of continuing to optimise our store portfolio in House of Fraser, the businesses acquired from JD Sports and Jack Wills, reducing the number of stores from 58 at 27 October 2024 to 34 at 26 October 2025.

Gross profit increased by £11.9m as the negative impact of the revenue decline was more than offset by a 410bps increase in gross margin % from 38.6% to 42.7% (the result of an improving mix effect with FLANNELS increasing its proportion of group sales and through a more relevant product offering).

This gross profit growth was partially offset by a £6.7m increase in operating costs driven by increases to National Minimum Wage and Employers' National Insurance, resulting in an increase in segment trading profit of £5.2m.

Premium Lifestyle's operating profit result of £46.0m (FY25 H1: £48.3m) includes impairment reversals of £nil (FY25 H1: impairment reversals of £7.3m).

Store numbers decreased from 167 to 139 as we continued to optimise our store portfolio in House of Fraser, the businesses acquired from JD Sports, and Jack Wills.

INTERNATIONAL RETAIL

This segment includes the results all of the Group's sports retail stores, management and operating functions in Europe, Asia and the rest of the world, including the Group's European Distribution Centres in Belgium and Austria, Twinsport in the Netherlands, Holdsport in South Africa, XXL in the Nordics, the Baltics & Asia e-commerce offerings, the MySale business in Australia until its disposal in May 2025, and all non-UK based wholesale and licensing activities (relating to brands such as Everlast and Slazenger).

International accounts for 28.5% (FY25 H1 (1): 21.0%) of the Group's revenue.

*FY25 H1 store numbers restated to remove Game Spain.

International revenue benefited from the acquisitions of Holdsport (completed in May 2025) and XXL (completed in June 2025), partially offset by the disposal of the MySale business in May 2025. This resulted in revenue growth of 42.8% year-on-year.

Segment profit from trading increased by £46.4m year-on-year. Gross profit increased by £102.1m largely due the acquisitions noted above, which also drove an uplift in overhead costs of £55.7m.

International's operating profit result of £9.7m (FY25 H1(1): £18.3m) includes impairment charges of £29.1m (FY25 H1: impairment reversals of £2.4m), which reflect the write-down of the goodwill and intangible assets allocated to the Everlast and Twinsport businesses, and realised foreign exchange losses of £2.8m (FY25 H1: £4.4m).

Store numbers increased from 372 to 537 due to the acquisitions of Holdsport and XXL.

PROPERTY

This segment includes the results from the Group's freehold property owning and long leasehold holding property companies that generate third party rental and other property related income (e.g., car parking, conference and events income). The depreciation of freehold and long leasehold owner-occupied properties is also reported in this segment.

Property accounts for 1.5% (FY25 H1 (1): 1.1%) of the Group's revenue.

Revenue increased by £12.5m (47.7%), due to the annualisation of prior year acquisitions including Doncaster's Frenchgate, Exeter's Princesshay, Maidstone's Fremlin Walk, and Affinity outlets, as well as the impact of acquisitions in FY26 H1.

Segment profit from trading increased by £16.4m, with the additional rental income combining with the non-repeat of one-off acquisition costs from the prior year.

Property's operating loss of £2.3m (FY25 H1 (1); loss of £0.2m) includes a net impairment charge of £20.7m (FY25 H1 (1): £0.7m impairment), largely relating to two under-performing stores in the UK and depreciation of £21.0m (FY25 H1 (1): £21.3m).

Property investment remains a key focus for the Group, unlocking occupational demand for our retail business whilst delivering strong returns that can be recycled at the appropriate time.

FINANCIAL SERVICES

This segment includes the results of Frasers Group Financial Services. This includes interest charged on amounts advanced to consumer credit customers, along with the associated impairment and operating costs.

Financial Services accounts for 1.3% (FY25 H1 (1): 1.9%) of the Group's revenue.

Frasers Plus continues to make progress towards our long-term ambitions of delivering £1bn+ in sales, £600m in credit balances, a greater than 15% yield, and over 2 million active Frasers Plus customers (excluding any third-party partnerships). £154m of retail sales were made on credit in FY26 H1 (FY25 H1: £154m). The business ended FY26 H1 with 1.1m active customers (FY25 H1: 0.4m) and Frasers Plus accounted for 20.0% of UK online sales, compared to 13.7% in FY25 H1. Encouraging improvements have also been seen in store uptake during FY26 H1, and the StudioPay exit is now complete. 

Revenue decreased by £12.2m (26.7%) vs. FY25 H1 as the business completed the closure of the Studio Pay product and migrated eligible customers to the Frasers Plus platform.

Segment profit from trading decreased by £14.5m due to the revenue decline noted above, partially offset by a £2.2m decrease in impairment charges, combined with an increase in overhead costs of £4.5m arising from the dual running of Frasers Plus and Studio Pay. FY25 H1 also benefited from a £4.2m gain in respect of a legal settlement.

We continue to see a great opportunity for Frasers Plus as a new revenue stream and a key pillar of our compelling brand ecosystem.

DISCONTINUED OPERATIONS

In FY26 H1, the result from discontinued operations reflects the trading loss of Coventry Arena until its disposal in August 2025 (£1.4m), as well as a £33.8m gain on disposal.

In the prior period, the result from discontinued operations relates to amounts received from the Matches administration in excess of those assumed at FY24 year-end (a gain of £4.3m), Game Spain's trading loss for the period (£1.0m) and Coventry Arena's trading loss for the period (£0.8m). 

BALANCE SHEET

The increase within property, plant and equipment from 27 April 2025 is largely due to net additions from acquired businesses partially offset by depreciation.

The increase to investment property since 27 April 2025 reflects acquisitions totalling £82.8m at sites including Greenock, Guildford, Burnley and Almondvale.

Long-term financial assets have decreased since 27 April 2025 due to the reclassification of the fair value of the Group's holdings in HUGO BOSS and Accent Group to investments in associated undertakings (a reduction of £569.2m), the acquisition of XXL (a reduction of £25.5m), net additions of £52.7m, fair value gains of £67.2m and foreign exchange movements (a reduction of £6.7m).

The principal movements in investments in associated undertakings relate to the reclassification of the fair value of the Group's holdings in HUGO BOSS and Accent Group from long-term financial assets (an increase of £569.2m), further investments in HUGO BOSS (an increase £133.5m), the Group's share of associates' profit (an increase of £19.7m), and foreign exchange gains (an increase of £0.4m), offset by the Group's share of associates' other comprehensive losses (a reduction of £6.0m), dividends received (a reduction of £12.5m), and fully impairing the carrying value of the Group's investments in Kangol LLC and X Channel Marketing Ltd (a reduction of £17.9m).

The increase to intangible assets since 27 April 2025 primarily reflects the recognition of approximately £139.1m of goodwill in respect of the acquisition of XXL and £110.3m in respect of the acquisition of Holdsport (plus the associated foreign exchange movements), offset by amortisation charged in respect of other intangible assets and impairments of goodwill and intangible assets in respect of Matches, Everlast and Twinsport totalling £47.1m. The fair value of acquired assets and thus goodwill value will be finalised by year-end in accordance with IFRS 3 Business Combinations.

The increase in the inventory balance since year-end is reflective of the acquisitions of XXL and Holdsport as well as normal seasonal trends.

Trade and other receivables includes £276.4m relating to deposits in respect of derivative financial instruments (27 October 2024 £182.8m; 27 April 2025: £522.7m) and the Frasers Group Financial Services consumer credit receivables portfolio with a carrying value of £162.0m (27 October 2024 £195.6m; 27 April 2025: £181.7m).

See note 10 for further details in relation to provisions.

The increase in trade and other payables since 27 April 2025 largely follows seasonal patterns, the impact of acquisitions, and the timing of payments around the end of October.

CASH FLOW AND NET DEBT

Net debt increased by £181.2m from £941.0m at 27 April 2025 to £1,122.2m at 26 October 2025, reflecting capital expenditure, international acquisitions and strategic investments in FY26 H1, particularly Accent Group and HUGO BOSS. Net debt includes £91.8m of borrowings relating to the Frasers Group Financial Services Limited securitisation facility (27 October 2024 £106.3m; 27 April 2025: £93.5m).

Net interest on bank loans and overdrafts increased to £48.1m (FY25 H1: £36.8m) largely due to increased usage of the Revolving Credit Facility ("RCF") in the period.

Analysis of net debt:

The Group completed the successful refinancing of its combined term loan and RCF in July 2025 and now has access to total committed facilities in excess of £3 billion for a period of at least three years. The facility has two one-year extension options.

Cash flow:

(1) Restated to reflect the classification of the results of Game Spain and Coventry Arena as discontinued operations and the reclassification of delivery income and costs associated with free-issue gift vouchers from selling, distribution and administrative expenses to revenue. Please refer to note 1 of the financial information for further details.

(2) This is an Alternative Performance Measure, for which the reconciliation to the equivalent GAAP measure is set out in note 3 to the financial information. Adjusted EPS is discussed in note 8.

GOING CONCERN

Having thoroughly reviewed the performance of the Group and having made suitable enquiries, the Directors are confident that the Group has adequate resources to remain in operational existence for the foreseeable future which is at least 12 months from the date of approval of these unaudited condensed consolidated financial statements. Full details of this assessment can be found in note 1.

DIRECTORS' RESPONSIBILITY STATEMENT

Each of the directors confirm that to the best of their knowledge:

The summary of results for the 52 weeks ended 27 April 2025 is an extract from the published Annual Report and Financial Statements which have been reported on by the Group's auditors at the time and delivered to the Registrar of Companies. The audit report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under s498 (2) or s498 (3) of the Companies Act 2006.

Michael Murray

Chief Executive Officer

4 December 2025

FINANCIAL INFORMATION

CONSOLIDATED INCOME STATEMENT

FOR THE 26 WEEKS ENDED 26 OCTOBER 2025

(1) Restated to reflect the classification of the results of Game Spain and Coventry Arena as discontinued operations and the reclassification of delivery income and costs associated with free-issue gift vouchers from selling, distribution and administrative expenses to revenue. Please refer to note 1 for further information.

The result from discontinued operations was wholly attributable to the equity holders of the Group.

The accompanying accounting policies and notes form part of these condensed consolidated financial statements.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE 26 WEEKS ENDED 26 OCTOBER 2025

The accompanying accounting policies and notes form part of these condensed consolidated financial statements.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

The accompanying accounting policies and notes form part of these condensed consolidated financial statements.

CONSOLIDATED CASH FLOW STATEMENT

FOR THE 26 WEEKS ENDED 26 OCTOBER 2025

(1) Restated to reflect the classification of the results of Game Spain and Coventry Arena as discontinued operations. Please refer to note 1 for further information.

The accompanying accounting policies and notes form part of these condensed consolidated financial statements.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE 26 WEEKS ENDED 26 OCTOBER 2025 (unaudited)

FOR THE 26 WEEKS ENDED 27 OCTOBER 2024 (unaudited)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL INFORMATION

FOR THE 26 WEEKS ENDED 26 OCTOBER 2025

1. BASIS OF PREPARATION

Non-Statutory

The results for the first half of the financial year have not been audited or reviewed by external auditors. The financial information in the Group's Annual Report and Financial Statements for the 52-week period ended 27 April 2025 is prepared in accordance with UK-adopted International Accounting Standards and the requirements of the Companies Act 2006 and which have been delivered to the Registrar of Companies. The Interim Results have been prepared on the basis of the policies set out in the 2025 Annual Report and in accordance with International Accounting Standard (IAS) 34 'Interim Financial Reporting' as adopted by the UK and the Disclosure Guidance and Transparency Rules of the UK's Financial Conduct Authority (DTR). The Interim Results do not include all of the information required for full annual statements and should be read in conjunction with the 2025 Annual Report.

The summary of results for the 52 weeks ended 27 April 2025 is an extract from the published Annual Report and Financial Statements which have been reported on by the Group's auditors at the time and delivered to the Registrar of Companies. The audit report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under s498 (2) or s498 (3) of the Companies Act 2006.

Going Concern

The Directors have reviewed the current financial performance and liquidity of the business, including modelling a number of downside scenarios. The Group is profitable, highly cash generative and has considerable financial resources. The Group is able to operate within its banking facilities and covenants, which run until July 2028 and is well placed to take advantage of strategic opportunities as they arise. As a consequence, the Directors believe that the Group is well placed to manage its business risks successfully despite the continued uncertain economic outlook.

Management have assessed the level of trading and have forecast and projected a conservative base case scenario and also a number of even more conservative scenarios taking into account the Group's open positions in relation to various option positions. These forecasts and projections show that the Group will be able to operate within the current facility and its covenant requirements (being interest cover and net debt to EBITDA ratios). Management have also identified a number of mitigating actions which could be taken if required such as putting on hold discretionary spend, liquidating certain assets on the balance sheet and paying down the Revolving Credit Facility.

Having thoroughly reviewed the performance of the Group and Parent Company and having made suitable enquiries, the Directors are confident that the Group and Parent Company have adequate resources to remain in operational existence for the foreseeable future which is at least 12 months from the date of these financial statements. Trading would need to fall significantly below levels observed during the pandemic to require mitigating actions or a relaxation of covenants. On this basis, the Directors continue to adopt the going concern basis for the preparation of these condensed consolidated financial statements.

New accounting standards, interpretations and amendments adopted by the Group

The principal accounting policies have remained unchanged from those applied for the 52 week period ended 27 April 2025 except as noted below.

Several amendments apply for the first time during the period but have not resulted in any changes to the Group's accounting policies or had any other material impact on the financial position or performance of the Group. The Group continues to monitor the potential impact of new standards and interpretations which have been or may be endorsed and require adoption by the Group in future reporting periods. The Group does not consider that any standards, amendments or interpretation issued by the UK Endorsement Board, but not yet applicable, will have a significant impact on the condensed consolidated financial statements.

Risks and uncertainties

The Board has considered the risks and uncertainties for the remaining half of the financial year and determined that the risks and the level of risks presented in the FY25 Annual Report, noted below, also remain relevant for the rest of the financial year and that there aren't any further risks or uncertainties to add at this stage:

Detailed explanations of the principal risks and uncertainties can be found in the Principal Risks and Uncertainties section of the FY25 Annual Report.

Restated Financial Information

Reclassification of delivery income and costs associated with free-issue gift vouchers

Following a review of financial reporting processes undertaken during the prior period, management identified that income received from customers in respect of the delivery on online orders and the costs associated with offering free-issue gift vouchers (essentially a discount against a future order) had been incorrectly classified within selling, distribution and administrative expenses rather than within revenue.

The results for the prior period have been restated on an equivalent basis resulting in a £50.4m increase to revenue (and consequently gross profit) and a corresponding increase in selling, distribution and administrative expenses.

This change does not impact upon the Group's reported profit, earnings per share, consolidated balance sheet or consolidated cashflow statement in either the current or prior period.

Game Spain

The Group completed the disposal of the Game Spain business on 19 March 2025 by way of selling the entire share capital of Game Spain Iberia, SL to Guidebridge Opportunities 4, S.L. In accordance with IFRS 5.32, management considered that Game Spain constituted a separate major line of business that had been disposed of and that it therefore met the criteria to be classified as a discontinued operation. Consequently, its results for the current period have been presented separately as a single line item within the Consolidated Income Statement. The prior period results have been restated on an equivalent basis. Please refer to Note 7 in the FY25 Annual Report for further details.

Coventry Arena

The Group completed the disposal of the Coventry Arena business on 23 August 2025 by way of selling the entire share capital of Coventry Areana Opco Limited, Coventry Arena Propco Limited, Coventry Arena Retail Limited and Coventry Arena Ipco Limited to Covcityco LTD. In accordance with IFRS 5.32, management considered that Coventry constituted a separate major line of business that had been disposed of and that it therefore met the criteria to be classified as a discontinued operation. Consequently, its results for the current period have been presented separately as a single line item within the Consolidated Income Statement. The prior period results have been restated on an equivalent basis.

2. CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES

Climate Change

We have considered the potential impact of climate change in preparing these financial statements. Tackling climate change is a global imperative and measures which support climate change initiatives and our wider ESG agenda continue to be key components of our strategic direction, supporting sustainability, the broader social agenda and consumer choice. The risks associated with climate change have been deemed to be arising in the medium to long term and we are working to mitigate these risks as detailed within the TCFD section of the FY25 Annual Report.

We have considered climate change as part of our cash flow projections within going concern, impairment assessments and viability, and the impact of climate change is not deemed to have a significant impact on these assessments currently and therefore they are not deemed to be a key source of estimation uncertainty. The Group will continue to monitor the impacts of climate change over the coming years.

Determining Related Party Relationships

Management determines whether a related party relationship exists by assessing the nature of the relationship by reference to the requirements of IAS 24 Related Party Disclosures. This is in order to determine whether significant influence exists as a result of control, shared directors or parent companies, or close family relationships. The level at which one party may be expected to influence the other is also considered for transactions involving close family relationships.

Control and Significant Influence Over Certain Entities

Under IAS 28 Investments in Associates and Joint Ventures if an entity holds 20% or more of the voting power of the investee, it is presumed that the entity has significant influence, unless it can clearly demonstrate that this is not the case.

In assessing the level of control that management have over certain entities, management will consider the various aspects that allow management to influence decision making. This includes the level of share ownership, board membership, the level of investment and funding, and the ability of the Group to influence operational and strategic decisions and affect its returns through the exercise of such influence. If management were to consider that the Group does have significant influence over the entity then the equity method of accounting would be used and the percentage shareholding multiplied by the results of the investee in the period would be recognised in profit or loss.

Where an investment previously accounted for at fair value through OCI under IFRS 9 becomes an associate, the fair value of the interest held at the date that significant influence is obtained is deemed to be the cost for the initial application of equity accounting.

Shareholdings in investees greater than 20%

Mulberry Group plc

Management consider that the Group did not have significant influence at any point in the current or prior periods for the following reasons:

• There is no participation in decision making and strategic processes, including participation in decisions about dividends or other distributions. In this regard, it was noted that there is another shareholder (Challice Limited) who owns over 50% of the shares.

• There have been no material transactions between the Group and the investee.

• There has been no interchange of managerial personnel.

• No non-public essential technical management information is provided by the investee.

Management notes that a representative of the Group was appointed to the board of Mulberry during the current period. Whilst representation on the board of directors is an indicator of significant influence, management conclude that, in this instance, it has not yet given rise to significant influence due to the make-up of the rest of the board and the presence of a majority shareholder. Thus, management have not been able to evidence significant influence in decision making and strategic processes. This position will be kept under review.

ASOS plc

Management consider that the Group did not have significant influence at any point in the current or prior periods for the following reasons:

• The Group does not have any representation on the board of directors.

• There is no participation in decision making and strategic processes, including participation in decisions about dividends or other distributions. In this regard, it was noted that there is another shareholder with a larger shareholding than the Group.

• There have been no material transactions between the Group and the investee.

• There has been no interchange of managerial personnel.

• No non-public essential technical management information is provided by the investee.

AO World plc

Management consider that the Group did not have significant influence at any point in the current or prior periods for the following reasons:

• The Group does not have any representation on the board of directors.

• There is no participation in decision making and strategic processes, including participation in decisions about dividends or other distributions. It was noted that there are a number of other shareholders who hold large investments comparable to the Group's. These include John Roberts (the founder of the business) who remains a board director and currently holds 17.5% of the voting rights, and also Camelot Capital who hold 20.4% of the voting rights. In combination, these other large shareholders could block any resolutions proposed by the Group.

• There have been no material transactions between the Group and the investee.

• There has been no interchange of managerial personnel.

• No non-public essential technical management information is provided by the investee.

Boohoo Group plc

Management consider that the Group did not have significant influence at any point in the current or prior periods for the following reasons:

• The Group does not have any representation on the board of directors. The Group attempted to get directors appointed to the Board during FY25, but these attempts were rebuffed.

• There is no participation in decision making and strategic processes, including participation in decisions about dividends or other distributions. It was noted that the Kamani family holds 22.8% of voting rights in the company and that the two founders of the group are members of the board of directors. These individuals run the business on a day-to-day basis and the Group's management do not consider that they exert significant influence on them.

• There have been no material transactions between the Group and the investee.

• There has been no interchange of managerial personnel.

• No non-public essential technical management information is provided by the investee.

Four (Holdings) Limited

The Group holds 49% of the share capital of Four (Holdings) Limited which is accounted for as an associate using the equity method. The Group does not have any representation on the board of directors and no participation in decision making about relevant activities such as establishing operating and capital decisions, including budgets, appointing or remunerating key management personnel or service providers and terminating their services or employment. However, in prior periods the Group has provided Four (Holdings) Limited with a significant loan. At the reporting date, the amount owed by Four (Holdings) Limited for this loan totalled £22.5m (FY25: £22.5m), being £6.4m (FY25: £6.4m) net of amounts recognised in respect of loss allowance. The Group is satisfied that the existence of these transactions provides evidence that the entity has significant influence over the investee but in the absence of any other rights, in isolation it is insufficient to meet the control criteria of IFRS 10, as the Group does not have power over Four (Holdings) Limited. The investee is accounted for as an associate under IAS 28.

Tymit Limited

The Group holds 44.2% (FY25: 44.2%) of the share capital of Tymit Limited. This holding is accounted for as an associate under IAS 28, although the carrying value of the investment is £nil as a result of management's assessment of future trading prospects of the business. Management has advanced Tymit convertible loans of £16.8m at 26 October 2025 (£16.8m as 27 April 2025), which have been fully provided for. Management has considered whether any of the rights attaching to the loan notes could give rise to control and concluded that this was not the case.

Kangol LLC

The Group holds 49% of the share capital of Kangol LLC having sold 51% of its shareholding to Bollman Hat Company for £17.6m during FY24. Management considered the criteria set out in IFRS 10 when assessing whether or not it retains control of the entity or significant influence as defined by IAS 28. It was concluded that the Group has significant influence by virtue of its holding more than 20% of the voting power of the investee, but not control since Bollman holds 51% of total voting rights. Consequently, the Group's 49% shareholding has been accounted for as an associate under IAS 28.

Hudson Holdings ("Hudson")

The Group acquired a 41.8% holding in Hudson during FY25. This holding is accounted for as an associate under IAS 28 as the Group exhibits significant influence over the investee, including over strategic decision making.

HUGO BOSS

The Group holds 25.2% of the share capital of HUGO BOSS AG at the period end. Michael Murray was appointed to the supervisory board on 16 May 2025. Management consider that the Group held significant influence over the investee from 16 May 2025 and HUGO BOSS is accounted for as an associate under IAS 28 from that date.

Accent Group

In May 2025 the Group entered into a long-term partnership with Accent, increasing its shareholding to 19.9%. A representative of the Group is also on the board of Accent. Management consider that the Group had significant influence over the investee from May 2025 and Accent is accounted for as an associate under IAS 28 from that date.

Cash Flow Hedging

The Group uses a range of forward and option contracts that are entered into at the same time, are in contemplation with one another and have the same counterparty. A judgement is made in determining whether there is an economic need or substantive business purpose for structuring the transactions separately that could not also have been accomplished in a single transaction. Management are of the view that there is a substantive distinct business purpose for entering into the options and a strategy for managing the options independently of the forward contracts. The forward and options contracts are therefore not viewed as one instrument and hedge accounting for the forwards is permitted.

Under IFRS 9 Financial Instruments, in order to achieve cash flow hedge accounting, forecast transactions (primarily Euro denominated sales and USD denominated purchases) must be considered to be highly probable. The hedge must be expected to be highly effective in achieving offsetting changes in cash flows attributable to the hedged risk. The forecast transaction that is the subject of the hedge must be highly probable and must present an exposure to variations in cash flows that could ultimately affect profit or loss. Management have reviewed the detailed forecasts and growth assumptions within them and are satisfied that forecasts in which the cash flow hedge accounting has been based meet the criteria per IFRS 9 as being highly probable forecast transactions. Should the forecast levels not pass the highly probable test, any cumulative fair value gains and losses in relation to either the entire or the ineffective portion of the hedged instrument would be recognised in the Consolidated Income Statement.

Management considers various factors when determining whether a forecast transaction is highly probable. These factors include detailed sales and purchase forecasts by channel, geographical area and seasonality, conditions in target markets and the impact of expansion in new areas. Management also consider any change in alternative customer sales channels that could impact on the hedged transaction.

If the forecast transactions were determined to be not highly probable and all hedge accounting was discontinued, amounts in the hedging reserve of up to £6.4m (27 April 25: £7.5m) would be shown in finance income.

Classification of Investment Properties

Upon the acquisition of a property, management perform an assessment of the rationale for holding the property in line with IAS 40 Investment Property. Management applies judgement in the consideration of whether or not it is feasible to sell or let parts of the property under a finance lease, whether this is commercially viable in the relevant marketplace, and whether or not any owner-occupied portion is insignificant.

During the current period, the Group acquired five properties, all of which met the criteria to be classified as investment properties and were considered to be non-separable, with either insignificant or no owner-occupied portions.

Key Sources of Estimation Uncertainty

The critical estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below:

Inventory provisioning

The Group carries significant amounts of inventory, against which there are provisions for expected losses to be incurred in the sale of slow moving, obsolete and delisted products. At 26 October 2025 a provision of £182.8m (27 April 2025: £146.8m; 27

October 2024: £173.3m) was held against a gross inventory value of £1,635.8m (27 April 2025: £1,275.1m; 27 October 2024:

£1,515.2m).

The Group has applied the same inventory provision in FY26 H1 as that set out in note 2 to the FY25 consolidated financial statements.

Dilapidations - Note 10

The Group provides for its legal responsibility for dilapidation costs following advice from chartered surveyors and previous experience of exit costs (including strip out costs and professional fees). Management do not consider these costs to be capital in nature and therefore dilapidations are not capitalised, except for in relation to the sale and leaseback of Shirebrook for which a material dilapidations provision was capitalised in FY20.

Management calculates its best estimate of the provision required by reference to the proportion of closed stores for which a dilapidation cost is likely to be incurred, based on past experience, and an estimate for the level of costs based on advice from chartered surveyors. The annual movement in the dilapidations provisions is considered immaterial.

Sensitivity analysis to changes in key assumptions is as follows:

Legal and regulatory provisions - Note 10

Provisions are made for items where the Group has identified a present legal or constructive obligation arising as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

Legal and regulatory provisions reflect management's best estimate of the potential costs arising from the settlement of outstanding disputes of a commercial and regulatory nature. A substantial portion of the amounts provided relates to ongoing legal claims and non-UK tax enquiries. Management have made a judgement to consider all claims collectively given their similar nature. In accordance with IAS37.92, management have concluded that it would prejudice seriously the position of the entity to provide further specific disclosures in respect of amounts provided for non-UK tax enquiries and legal claims.

Other receivables and amounts owed by related parties

Other receivables and amounts owed by related parties are stated net of provision for any impairment. Management have applied estimates in assessing the recoverability of working capital and loan advances made to investee companies. Matters considered include the relevant financial strength of the underlying investee company to repay the loans, the repayment period and underlying terms of the monies advanced, forecast performance of the underlying borrower, and where relevant, the Group's intentions for the companies to which monies have been advanced. Management have applied a weighted probability to certain potential repayment scenarios, with the strongest weighting given to expected default after two years.

Impairment of Assets

a) IFRS 16 right-of-use assets and associated plant and equipment

IFRS 16 Leases defines the lease term as the non-cancellable period of a lease together with the options to extend or terminate a lease, if the lessee were reasonably certain to exercise that option. The Group will assess the likelihood of extending lease contracts beyond the break date by taking into account current economic and market conditions, current trading performance, forecast profitability and the level of capital investment in the property.

IFRS 16 Leases states that the lease payments shall be discounted using the lessee's incremental borrowing rate where the rate implicit in the lease cannot be readily determined. Accordingly, all lease payments have been discounted using the incremental borrowing rate (IBR). The IBR has been determined by using a synthetic credit rating for the Group which is used to obtain market data on debt instruments for companies with the same credit rating, this is split by currency to represent each of the geographical areas the Group operates within and adjusted for the lease term.

The right of use assets are assessed for impairment at each reporting period in line with IAS 36 Impairment of Assets to review whether the carrying amount exceeds its recoverable amount. For impairment testing purposes the Group has determined that each store is a separate cash generating unit ("CGU"). The recoverable amount is calculated based on the Group's latest forecast cash flows which are then extrapolated to cover the period to the break date of the lease taking into account historic performance and knowledge of the current market, together with the Group's views on future profitability of each CGU. The key assumptions in the calculations are the sales growth rates, gross margin rates, changes in the operating cost base and the pre-tax discount rate derived from the Group's weighted average cost of capital using the capital asset pricing model, the inputs of which include a risk-free rate, equity risk premium and a risk adjustment (Beta). Given the number of assumptions used, the assessment involves significant estimation uncertainty.

An asset is impaired when the carrying amount exceeds its recoverable amount. Equally, previous impairments are reversed when the recoverable amount exceeds the carrying amount and there are previous impairments against the asset.

In the current period, an impairment charge for the amount of £2.5m (FY25 H1: net reversal £15.2m) was recognised due to certain properties under performing against forecasted results. This is broken down as follows:

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

A sensitivity analysis has been performed in respect of sales, margin, the new store exemption and operating costs as these are considered to be the most sensitive of the key assumptions:

(1)  Stores which have been open for less than one year are not reviewed for impairment. Management do not consider that a trading performance in the first year that is worse than an appraisal forecast constitutes an indicator of impairment. Management also notes that new stores can take up to a year to develop an established trading pattern. Stores trading for less than one year are still reviewed for impairment if there are other significant indicators of impairment present such as a deterioration in local market conditions. This has changed in the current period from a two-year exemption to a one-year exemption, the impact is not material as shown above.

b) Freehold land and buildings, long-term leasehold, investment property and associated plant and equipment

Freehold land and buildings and long-term leasehold assets are assessed at each reporting period for whether there is any indication of impairment in line with IAS 36 Impairment of Assets.

An asset is impaired when the carrying amount exceeds its recoverable amount. Equally previous impairments are reversed when the recoverable amount exceeds the carrying amount and there are previous impairments against the asset. IAS 36 Impairment of Assets defines recoverable amount as the higher of an asset's or CGU's fair value less costs of disposal and its value in use. the Group has determined that each store is a separate CGU.

Key triggers considered by management include store (i.e., CGU) EBITDA showing a material year-on-year movement, significant changes in property valuations, and whether any new, wider economic factors may impact the forecast performance. Based on the criteria set by management, an impairment charge of £18.2m (FY25 H1: £0.7m) was recorded for the current period due to certain properties under performing against forecasted results. This is broken down as follows:

Value in use (VIU)

The value in use is calculated based on a five year cash flow projection. This is formulated by using the Group's forecast cash flows of each individual CGU, taking into account historic performance of the CGU, and then adjusting for the Group's current views on future profitability of each CGU. The key assumptions in the calculations are the sales growth rates, gross margin rates, changes in the operating cost base and the pre-tax discount rate derived from the Group's weighted average cost of capital using the capital asset pricing model, the inputs of which include a risk-free rate, equity risk premium and a risk adjustment (Beta). Given the number of assumptions used, the assessment involves significant estimation uncertainty.

The key assumptions, which are equally applicable to each CGU, in the cash flow projections used to support the carrying amount of the freehold land and buildings were as follows:

A sensitivity analysis has been performed in respect of sales, margin and operating costs as these are considered to be the most sensitive of the key assumptions.

Fair value less costs of disposal

For those CGUs where the value in use is less than the carrying value of the asset, the fair value less costs of disposal has been determined using both external and internal market valuations. This fair value is deemed to fall into Level 3 of the fair value hierarchy as per IFRS 13 Fair Value Measurement. The property portfolio consists of vacant, Frasers Group occupied and third party tenanted units. One property can include all three types. The following valuation methodology has been adopted for each:

A 10% increase in the market valuation amounts used in the impairment calculations would result in a decrease in impairment of £0.2m (FY25 H1: £nil).

The total recoverable amount of the assets that were impaired, or on which impairments were reversed, at the period end was £18.4m (FY25 H1: £64.0m), with £1.5m (FY24 H1: £nil) of this being based on their fair value less costs of disposal and £16.9m (FY25 H1: £64.0m) being based on their value in use.

Credit Customer Receivables

The Group's credit customer receivables are recognised on balance sheet at amortised cost (i.e., net of provision for expected credit loss). At 26 October 2025, consumer credit receivables with a gross value of £202.6m were recorded on the balance sheet, less a provision for impairment of £40.6m (27 April 2025: gross value of £254.9m, less a provision for impairment of £73.2m). The Group has applied the same methodology for calculating expected credit loss as that detailed in note 2 to the FY25 consolidated financial statements.

3. SEGMENTAL ANALYSIS

IFRS 8 requires operating segments to be identified on the basis of the internal financial information reports to the Chief Operating Decision Maker ("CODM") who is primarily responsible for the allocation of resources to segments and assessment of performance of the segments.

The Group presents five operating segments: 

· UK Sports

This segment includes the results of the Group's core sports retail store operations in the UK, plus all the Group's sports retail online business, other UK-based sports retail and wholesale operations, GAME UK stores and online operations, retail store operations in Northern Ireland, Frasers Fitness, Studio Retail's sales and the Group's central operating functions (including the Shirebrook campus).

· Premium Lifestyle

This segment includes the results of the Group's premium and luxury retail businesses FLANNELS, Cruise, Van Mildert, Jack Wills, House of Fraser & Frasers, Gieves and Hawkes, and Sofa.com along with the related websites, the businesses acquired from JD Sports, as well as the results from the I Saw it First website.

· International 

This segment includes the results all of the Group's sports retail stores, management and operating functions in Europe, Asia and the rest of the world, including the Group's European Distribution Centres in Belgium and Austria, Twinsport in the Netherlands, Holdsport in South Africa, XXL in the Nordics, the Baltics & Asia e-commerce offerings, the MySale business in Australia until its disposal in May 2025, and all non-UK based wholesale and licensing activities (relating to brands such as Everlast and Slazenger).

· Property

This segment includes the results from the Group's freehold property owning and long leasehold holding property companies that generate third party rental and other property related income (e.g., car parking, conference and events income). The depreciation of freehold and long leasehold owner-occupied properties is also reported in this segment.

· Financial Services

This segment includes the results of Frasers Group Financial Services. This includes interest charged on amounts advanced to consumer credit customers, along with the associated impairment and operating costs.

The operating performance of each segment is assessed by reference to revenue, gross margin, and profit from trading activities after operating expenses. For the avoidance of doubt, operating costs in the Group's three retail operating segments include rents payable to third party landlords. Intra-group rent payments are eliminated on consolidation.

For the property segment, profit from trading activities includes fair value gains and losses in respect of investment properties (see further below) and gains or losses on disposal of properties since the Group's property businesses seek to generate income from rentals and capital appreciation of properties held.

In the Financial Services segment, impairment losses on consumer credit receivables are disclosed within gross margin, which management deem to be the appropriate treatment for a financial services business.

Depreciation, amortisation and impairments (net of any reversals) are disclosed as part of each segment's operating profit/(loss).

Net investment and finance income and costs are not split by segment as management consider that these items relate to the Group as a whole and any split would not be meaningful.

Segmental information for the 26 weeks ended 26 October 2025 (unaudited):