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Frasers Group shows effect of elevation strategy in boosting sales and profits in preview of full-year figures

The first Flannels flagship store is now operating in Liverpool. Image courtesy of Flannels

Frasers Group says its ‘elevation strategy’ of taking its stores upmarket and investing online has helped it to boost sales and profits in its latest financial year. 

The retailer today issued a full-year trading update with initial figures for the year to April 24 2022, but as yet excluding the impact of its £27m Studio Retail acquisition in February.

Today it says that group revenues grew by 30.9%, excluding the Studio Retail figures. Within its revenues, UK sports retail revenue grew by 31.2%, reflecting the performance of stores in the wake of lockdown last year, while sales in its premium lifestyle division grew by 31.2%  – led by new Flannels stores and online growth as well as post-lockdown reopenings. Its Flannels flagship store in Liverpool opened last month, boasting a ‘world first’ social media integrated clinic.

Pre-tax profits of £366.1m grew from £8.5m last time as its stores performed well after lockdown. Adjusted pre-tax profits of £344.8m were up from a loss of £39.9m a year earlier. Flannels Group is now targeting adjusted pre-tax profits of between £450m and £500m in the coming year.

The retailer has in recent years been focused on an ‘elevation strategy’ aimed at raising the perceptions of the retailer’s brands in order to attract more high profile brands to its stores. It has also bought a number of brands itself, most recently acquiring Missguided out of administration. 

New Frasers Group chief executive Michael Murray, who has taken over from founder Mike Ashley, says: “I am really proud of the record performance we’ve announced today. It’s clear that our elevation strategy is working and we are building incredible momentum with new store openings, digital capabilities and deeper brand partnerships across all of our divisions. We’ve got the right strategy, team and determination to keep driving our business from strength to strength.”

The retailer says it is continuing to develop new and existing brand partner relationships and is looking for new ecommerce opportunities through moves such as its Missguided acquisition. The retire says it has “significantly improved the digital consumer experience across all touchpoints within the group”. It has also refinanced its group lending facility, which now stands at £980m, while returning £193.2m to shareholders through a buyback scheme. 

Frasers Group brands include Jack Wills, ranked a Top50 retailer in RXUK Top500 research, while Evans Cycles and Game are Top100, House of Fraser Top150, Sports Direct Top250 and Flannels Top350.

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