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2mo ago

Frasers Posts Record Underlying Profits as Budget Costs Bite and Luxury Sales Slide

Frasers expects to deliver £550m–£600m of underlying profits through AI-driven efficiencies alongside its expanded investment portfolio.

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Frasers Group gave cautious guidance for this financial year, saying that potential tax rises and subdued consumer sentiment were to blame

Overview

  • Underlying pre-tax profits rose 2.8% to £560.2m in the year to April 27 despite revenues falling 7.4% to £4.9bn.
  • On a reported basis, pre-tax profits dropped 24.3% to £379.4m due to currency headwinds and a decline in the value of its Hugo Boss stake.
  • Frasers confirmed at least £50m of additional costs from the 2024 budget’s national insurance and minimum wage rises.
  • Sales in its premium lifestyle division, including Flannels and House of Fraser, slumped almost 15% as luxury demand weakened.
  • The group forecast £550m–£600m of underlying profits for 2025–26 while targeting cost cuts via AI efficiencies and leveraging its near-doubled strategic investment portfolio.