Unaudited Results for the Half Year Ended 26
October 2024
Performance continues to
strengthen
We Help Everyone Enjoy
Amazing Technology
Summary
· Group delivered adjusted EBIT £41m, +52% YoY
· Group free cash flow £50m, +£46m
YoY
· UK&I revenue growth +6%, based on market share growth and
strategic initiatives performing well - including Services, B2B and
iD Mobile subscribers +32% to 2.0m
· Nordics adjusted EBIT +50% YoY driven by growth in market
share in a continuing difficult market
· Balance sheet further strengthened
Financial performance
· Group revenue £3,918m, +1% YoY (currency neutral +2%), driven
by LFL revenue +2%
· Group adjusted profit before tax £9m, +£25m YoY; reported
loss before tax £(10)m, +£34m YoY
· UK&I LFL revenue +5%, adjusted EBIT £23m, +53% YoY -
strong sales and improved gross margin more than offset both
investment and inflationary cost increases
· Nordics LFL revenue (2)%, adjusted EBIT £18m, +50% YoY -
gross margins up +80bps with reduced operating costs
· Period end net cash of £107m - first-half cash inflow of
£11m, compared to £(32)m outflow in prior year
· Period end IAS 19 pension deficit £(143)m, from £(171)m at
year end
Current year outlook
· Trading since the period end has been consistent with the
Board's expectations
· Full year guidance unchanged - the
Group continues to expect growth in profits and free cash flow for
the year
Alex Baldock, Group Chief Executive
"We're very encouraged by our
progress. Currys' performance continues to strengthen, with profits
and cashflow growing significantly, and the Group's balance sheet
is strong.
In the UK&I, we made big
improvements to both Online and Stores channels, customers
continued to take more of the solutions and services that are
valuable to them and to us, and such growth drivers as B2B and iD
Mobile performed well. All this showed in growing sales, market
share, gross margins and profits. In the Nordics, we gained market
share, increased gross margins, tightly controlled costs and grew
profits in a still-tough consumer environment.
Underpinning our progress in both
markets is strong customer satisfaction, which increased again, and
colleague engagement now firmly established in the top 10% of
companies worldwide.
We were well prepared for our Peak
trading period, with healthy stock and market-beating, best-ever
deals that show our unmatched importance to suppliers. We're
trading in line with expectations. One highlight is rising demand
for AI laptops, where we enjoy over 75% market share in the UK. AI
is a trend with a lot further to run.
Looking ahead, we're confident of
continuing our progress, and expect to grow profits and cashflow as
promised this year. This is despite new and unwelcome headwinds
from UK government policy. These will add cost quickly and
materially, depress investment and hiring, boost automation and
offshoring, and make some price rises inevitable.
Still, there's plenty we can
control, including mitigating much of this headwind. We'll keep
colleague engagement world class, customer satisfaction increasing,
cashflow growing for shareholders, and playing an ever-bigger role
in society. We have growing momentum at Currys. As ever, I'm hugely
grateful to the tens of thousands of colleagues whose brilliant
work makes all this possible, and who are building this
ever-stronger Currys."
Performance Summary
Group sales increased +2% on a like-for-like
basis with growth in UK&I offset by a weak Nordics environment.
The Group grew market share and saw good growth from strategic
initiatives.
Revenue
|
H1 2024/25
£m
|
H1 2023/24
£m
|
Reported
% change
|
Currency
neutral
% change
|
Like-for-Like
% change
|
UK & Ireland
|
2,342
|
2,215
|
+6%
|
+6%
|
+5%
|
Nordics
|
1,576
|
1,653
|
(5)%
|
(3)%
|
(2)%
|
Continuing operations
|
3,918
|
3,868
|
+1%
|
+2%
|
+2%
|
In the UK&I, adjusted EBIT increased +53% YoY. The core
technology market1 declined (1.4)% YoY and we stabilised
market share at +20bps YoY. Alongside this, we saw strong
performance from Mobile and our B2B business that further boosted
growth, resulting in like-for-like revenue growth of +5%. Gross
margin continued to climb, growing +10bps YoY. Operating costs
increased as inflationary pressures were not all offset by cost
savings, while we increased investment spending and there was
additional marketing to drive sales.
In the Nordics, adjusted EBIT increased +50%
to £18m despite the difficult consumer demand environment. The
continued high interest rates and low consumer confidence drove a
market decline of (3.4)% YoY. Our business grew market share
+40bps, gross margin increased +80bps and costs were kept under
tight control.
As a result, Group adjusted EBIT increased +52%
to £41m and operating cashflow grew +11% to £61m. Free cash inflow
of £50m for the period was a +£46m improvement on last year due to
the better operating cashflow coupled with lower exceptional cash
costs and a much larger working capital inflow. Alongside the
slight increase in pension contributions, this resulted in cash
inflow for the period of £11m, a +£43m improvement compared to the
same period last year.
Profit and Cash Flow
Summary
|
H1 2024/25
£m
|
H1
2023/24
(Restated)
£m
|
H1 2024/25
Adjusted
£m
|
H1
2023/24
Adjusted
(Restated)
£m
|
Reported
%
change
|
Currency
neutral
%
change
|
Segmental EBIT
|
|
|
|
|
|
|
UK & Ireland
|
17
|
(1)
|
23
|
15
|
53%
|
53%
|
Nordics
|
12
|
7
|
18
|
12
|
50%
|
46%
|
EBIT on continuing operations
|
29
|
6
|
41
|
27
|
52%
|
50%
|
EBIT Margin
|
0.7%
|
0.2%
|
1.0%
|
0.7%
|
30
bps
|
30
bps
|
|
|
|
|
|
|
|
Net finance costs
|
(39)
|
(50)
|
(32)
|
(43)
|
26%
|
|
(Loss) / profit before tax on continuing
operations
|
(10)
|
(44)
|
9
|
(16)
|
|
|
Tax on continuing
operations
|
2
|
7
|
(2)
|
4
|
|
|
(Loss) / profit after tax on continuing
operations
|
(8)
|
(37)
|
7
|
(12)
|
|
|
Loss after tax on discontinued operations
|
-
|
(2)
|
|
|
|
|
Loss after tax
|
(8)
|
(39)
|
|
|
|
|
(Loss) / earnings per share on continuing
operations
|
(0.7)p
|
(3.3)p
|
0.6p
|
(1.1)p
|
|
|
|
|
|
|
|
|
|
Operating cash flow
|
|
|
61
|
55
|
11%
|
9%
|
Operating cash flow
margin
|
|
|
1.6%
|
1.4%
|
20
bps
|
|
|
|
|
|
|
|
|
Cash generated from continuing operations
|
206
|
166
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow
|
|
|
50
|
4
|
1150%
|
920%
|
Net cash / (debt)
|
|
|
107
|
(129)
|
|
|
1 Market refers to UK B2C market for consumer electronics,
computing and domestic appliances, as defined by GfK
Outlook
Current year guidance
Trading during the six weeks since
the period end has remained in line with the Board's expectations
and the Group expects to see growth in profits and free cash flow
for the year. This is after taking into account the
in-year impact of the UK Government budget
measures which will be effective for the last five weeks of the
Group's financial year.
Further guidance on current year
profits will be provided in the Peak trading statement on 15
January 2025.
All aspects of cashflow guidance
are unchanged, except capital expenditure which is now expected to
be lower than previously forecast:
· Capital expenditure of around £80m (previously around £90m)
as a higher proportion of project spending is expensed
· Net exceptional cash outflow of around £30m
· Pension contributions of £50m
Other technical guidance:
· Depreciation & amortisation around £290m
· Cash payments of leasing costs, debt & interest around
£260m
· Cash tax around £10m
· Cash interest of around £20m
Additional income statement
guidance:
· Total interest of around £70m (compared to £85m in
2023/24)
2024/25 is a 53-week year. This
will have a small impact on sales but immaterial impact on profits
and cashflows.
Looking forward
The Group has assessed the impact
of recent changes to Government policy including the recent budget.
The full year aggregated impact is expected to be an incremental
cost to the Group of £32m, including:
· £9m increase in wages due to National Living Wage increases.
This includes the direct impact and the indirect impact of
protecting (at least in part) wage differentials. All UK colleagues
of the same band are paid the same, so the larger increase in NLW
for 18-20 year olds has no impact
· £12m increase in National Insurance contributions, of which
£4m is due to the increase in the Employer NI rate to 15.0% (from
13.8%) and £8m is due to the decrease in the NI threshold from
£9,100 to £5,000
· £9m impact from the pass through of these costs from some of
our outsource partners
· £2m increase from the inflation-based increase in business
rate taxes.
Around half of these cost
increases were anticipated and there are plans in place to offset
their impact. The Group will seek to mitigate the remaining impact
as much as possible through further cost saving measures, including
process improvement, automation, offshoring, outsourcing and
overhead efficiencies. Some price rises are also
inevitable.
Despite these unexpected
headwinds, the Group expects the P&L to benefit from lower
interest costs, and is continuing to target at least 3% adjusted
EBIT margin.
Alongside this, the Group will
remain focused on free cash flow generation. The Group expects to
keep annual capital expenditure below £100m, for exceptional cash
costs to fall and to be below £10m by 2026/27, and to keep working capital at least neutral despite
continued growth of the Mobile business.
The next triennial pension
valuation date is March 2025 and the current IAS 19 deficit of
£143m compares to scheduled contributions of £277m across 2025/26
to 2028/29. The contributions will cease when the deficit reaches
zero on a prudent technical basis and the Group is continuing to
work proactively with the scheme trustees to maximise value for all
stakeholders.
As we announced on 27 June 2024,
providing trading continues to be in line with expectations, the
strengthened balance sheet and the improving cashflow dynamics
underpin the Board's intention to announce a recommencement of
shareholder returns no later than the full year results on 3 July
2025.
In the reporting of financial
information, the Group uses certain measures that are not required
under IFRS. These are presented in accordance with the Guidelines
on APMs issued by the European Securities and Markets Authority
('ESMA') and are consistent with those used internally by the
Group's Chief Operating Decision Maker to evaluate trends, monitor
performance, and forecast results. These APMs may not be directly
comparable with other similarly titled measures of 'adjusted' or
'underlying' revenue or profit measures used by other companies,
including those within our industry, and are not intended to be a
substitute for, or superior to, IFRS measures. Further information
and definitions can be found in the Notes to the Financial
Information of this report.
Unless otherwise stated, 2023/24
figures have been restated throughout this report to exclude
discontinued operations.
We Help Everyone Enjoy
Amazing Technology
Chief Executive's Review
The first half of the
year saw our performance continuing its upward trajectory with
significantly improved cashflow driven by a >50% adjusted EBIT
improvement in both Nordics and UK&I.
In the Nordics, we controlled what we can
control. The consumer demand environment remains weak but we grew
market share, improved gross margin and kept costs under tight
control. The business is well invested and is expected to generate
materially improved cashflow this year.
In the UK&I, we stabilised (and slightly
grew) our market share, and saw strong performance from Mobile and
our B2B business that further boosted growth. Gross margin
continued to climb, growing +10bps YoY. Operating costs reduced as
a proportion of sales as cost increases were more than offset by
operating leverage.
This progress continues to be built on our
long-term strategy.
Our strategy starts with "capable and
committed colleagues", as it is difficult in a business like ours
for the customer experience to exceed that of the colleague. We
have supported colleagues with better tools, training and reward,
while fostering a collaborative culture of success. In the Nordics
we launched our new values "We win together, play together, grow
together and are proud to be different together" to a very warm
reception from colleagues. Our latest colleague engagement survey
saw 78% participation across the Group and saw us maintain a score
of 80, which places us firmly in the top 10% of global
companies2.
Next, we want to provide an "easy to shop"
experience for our customers. We saw some notable improvements to
both of our channels. In the UK, we re-engineered more than 80
stores, to dedicate more space to categories that are more
profitable, and to allow more room for expansion into new
categories. We also added electronic shelf edge labelling (ESEL) to
60 UK stores. This is an innovation that has been successful in the
Nordics and creates a better customer experience, allows more
nimble pricing and saves colleagues' time. We expect to re-engineer
a further 33 stores and add ESEL to 40 stores in the second half of
the year. Our largest online site, currys.co.uk, which receives
over 250m visits per year, has seen over 60 changes that are
designed to improve the shopping journey, from easier navigation,
searching and filtering, through to an easier checkout, where we
now accept all payment types including Apple Pay and Google Pay
digital wallets. We have improved the online journey for order
& collect, which alongside better store processes has seen
order & collect sales grow +15% YoY (and +55% Yo2Y), to over
27% of our online revenue.
To fulfil this easy to shop experience, we
continually improve our already excellent logistics network. In
October, the long-term investment in our new Nordics distribution
centre started to pay back, as the facility became fully
operational. Adding 91,000m2 of new capacity allows us
to stock kitchens in Jönköping in Sweden instead of Brno in the
Czech Republic. This will lead to better lead times and fewer
issues for customers, lower costs for the Group and lowers our
carbon emissions for kitchens by 75%.
The third leg of our strategy is to create
"customers for life" through stickier and more valuable customer
relationships. At the heart of this is our unique
range of services that help customers afford and enjoy amazing
technology to the full, that build us valuable recurring revenue
streams, and encourage repeat shopping.
We help customers afford tech through credit,
and we have seen UK&I adoption climb +140bps to 21.7%, and
active customer accounts grow +15% to over 2.4m. This growth has
been helped by launch of Currys flexpay, as well as giving
colleagues the tools to sell through credit using their in-store
tablets.
We help customers get tech started, through
installation and set-up. Our installation services are becoming
ever more valued by customers, and 32% of UK big box deliveries now
include installation, a rise of +410bps YoY.
Once they have the tech, customers want to
keep it working and we give over 12m of them peace of mind through
protection plans. As the only tech retailer that operates its own
repair facilities, we can offer customers the protection they want
at good value. Our circular capabilities enable us to
do this efficiently, and during the period over 25% of the parts
used in the UK's central repairs had been previously harvested by
our operation.
Finally, we help customers get the most out of
their tech, with connectivity being the biggest enabler of
this.
Our Mobile business is growing, profitable and
cash generative. iD Mobile, our MVNO (Mobile Virtual Network
Operator) in the UK, has been the standout performer this year. It
has grown +32% YoY to 2.0m subscribers, achieving our year-end
target well ahead of plans. The recent CMA ruling on the proposed
Vodafone-Three merger provides additional confidence in sustaining
our excellent trajectory in Mobile.
Our aim is to continue growing sources of
higher margin, recurring revenue such as credit, protection plans
and connectivity so that over time our business mixes away from
single product purchases to the more predictable, recurring and
higher margin revenue streams of solution sales.
Delivering on our strategy helps customers, as
seen in higher customer satisfaction and increased market share,
and helps us through higher gross margins.
Our gross margins climbed again during the
period driven by better bundling of complete solutions, a higher
adoption rate of services, continued monetisation of the improved
customer experience, discipline on sales stimulation and cost
savings.
Our operating costs rose in the UK&I as
there was some cost inflation that was not fully offset by savings,
we spent more on marketing to drive incremental sales, and we
increased investment spend as planned. Over time, a greater
proportion of our investment spend has moved into operating rather
than capital expenditure, and we evaluate the paybacks and returns
generated based on the total spend.
Alongside improved profitability, we have been
focussed on cash discipline. Our capital expenditure guidance is
£10m lower as we have focussed on executing our plans to maximise
returns, and we saw substantial improvements in exceptional
expenditure. Our working capital improved despite headwinds of iD
Mobile growth and sales decline in the Nordics, as UK&I sales
growth and process improvements drove significant working capital
inflow. We finished the period with £107m net cash and a pension
deficit of £(143)m. This £(36)m net position is by far the
strongest balance sheet the Group has had in the decade since the
merger.
Overall, we entered our Peak trading period in
a robust position with great deals enabled by our strong supplier
relationships.
Looking to next year, the UK Government budget
is likely to add around £32m of annual cost to our business. We
will seek to mitigate as much of this as possible through cost
saving measures including process improvement, automation,
offshoring, outsourcing and other overhead efficiencies. Some price
rises are also inevitable. We will further update on this in due
course.
Despite this unwelcome and material headwind,
we remain confident. We are the clear #1 brand in all our markets,
with a diversified revenue base and a strategy that is
working. We remain focussed
on generating more free cash flow through
improved operating performance, tight working capital management
and disciplined capital expenditure to support
profitable growth and the long-term success of this
business.
Combined with the
stronger balance sheet, this will enable resumption and growth of
shareholder returns. We will be a business that's increasingly
valuable for shareholders as well as colleagues, customers and
society.
2 Colleague engagement survey, Glint October 2024
Results call
There will be a live presentation and audio
webcast followed by Q&A call for investors and analysts at
9:00am.
The presentation slides will be available via
the following link: https://brrmedia.news/CURY_IR_24
To participate in the live audio
Q&A session, please use the following participant access
details:
UK: +44 (0) 33 0551
0200, please quote 'Currys Interim Results' when prompted by the operator
Next
scheduled announcement
The Group is scheduled to publish its Peak
trading update, covering the 10 weeks to 4 January 2025, on
Wednesday 15 January 2025.
For further information
Dan
Homan
|
Investor Relations
|
+44 (0)7401 400442
|
Toby
Bates
|
Corporate Communications
|
+44 (0)7841 037946
|
Tim Danaher,
Sofie Brewis
|
Brunswick Group
|
+44 (0)2074 045959
|
Information on Currys plc is available
at www.currysplc.com
Follow us on LinkedIn and X:
@currysplc
About Currys
plc
Currys plc is a leading
omnichannel retailer of technology products and services, operating
online and through 715 stores in 6 countries. We Help Everyone Enjoy Amazing
Technology, however they choose to shop with us.
In the UK & Ireland we trade
as Currys and in the UK we operate our own mobile virtual network,
iD Mobile. In the Nordics we trade under the Elkjøp brand. We're
the market leader in all markets, able to serve all households and
employing 24,000 capable
and committed colleagues.
We help everyone enjoy amazing
technology. We believe in the power of technology to improve lives,
helping people stay connected, productive, fit, healthy, and
entertained. We're here to help everyone enjoy those benefits and
with our scale and expertise, we are uniquely placed to do
so.
Our full range of services and
support makes it easy for our customers to discover, choose, afford
and enjoy the right technology to the full. The Group's operations
include Europe's largest technology repair facility, a sourcing
office in Hong Kong and an extensive distribution network, centred
on Newark in the UK and Jönköping in Sweden, enabling fast and
efficient delivery to stores and homes.
We're a
leader in giving technology a longer life through repair, recycling
and reuse. We're reducing our impact on the environment in our
operations and our wider value chain and we aim to achieve net zero
emissions by 2040. We offer customers products that help them save
energy, reduce waste and save water, and we partner with charitable
organisations to bring the benefits of amazing technology to those
who might otherwise be excluded.
Certain statements made in this announcement are
forward-looking. Such statements are based on current expectations
and are subject to a number of risks and uncertainties that could
cause actual results to differ materially from any expected future
events or results referred to in these forward-looking statements.
Unless otherwise required by applicable laws, regulations or
accounting standards, we do not undertake any obligation to update
or revise any forward-looking statements, whether as a result of
new information, future developments or otherwise. Information
contained on the Currys plc website or the Twitter feed does not
form part of this announcement and should not be relied on as
such.
Performance Review
The business is managed and evaluated across
two reporting segments: UK & Ireland, and the Nordics. The
table below shows the combined Group results, with fuller
explanations following under each of the individual
segments.
Following the disposal of Kotsovolos on 10
April 2024, the Greece reporting segment has been removed from the
prior period results.
Income Statement
|
H1 2024/25
£m
|
H1
2023/24
(Restated)
£m
|
Reported
%
change
|
Currency
neutral
%
change
|
Revenue
|
3,918
|
3,868
|
1%
|
2%
|
|
|
|
|
|
Adjusted EBITDA
|
171
|
167
|
2%
|
3%
|
Adjusted EBITDA margin
|
4.4%
|
4.3%
|
10
bps
|
10
bps
|
|
|
|
|
|
Depreciation on right-of-use
assets
|
(89)
|
(88)
|
|
|
Depreciation on other
assets
|
(18)
|
(21)
|
|
|
Amortisation
|
(23)
|
(31)
|
|
|
Adjusted EBIT
|
41
|
27
|
52%
|
50%
|
Adjusted EBIT margin
|
1.0%
|
0.7%
|
30
bps
|
40
bps
|
|
|
|
|
|
Interest on lease
liabilities
|
(27)
|
(30)
|
|
|
Finance income
|
4
|
2
|
|
|
Adjusted finance costs
|
(9)
|
(15)
|
|
|
Adjusted PBT
|
9
|
(16)
|
|
|
Adjusted PBT margin
|
0.2%
|
(0.4)%
|
60
bps
|
60
bps
|
|
|
|
|
|
Adjusted tax
|
(2)
|
4
|
|
|
Adjusted Profit/(Loss) after tax on continuing
operations
|
7
|
(12)
|
|
|
Adjusted EPS
|
0.6p
|
(1.1)p
|
|
|
|
|
|
|
|
Statutory
Reconciliation
|
|
|
|
|
Adjusting items to
EBITDA
|
-
|
(9)
|
|
|
EBITDA
|
171
|
158
|
8%
|
9%
|
Adjusting items to depreciation
and amortisation
|
(12)
|
(12)
|
|
|
EBIT
|
29
|
6
|
383%
|
343%
|
EBIT Margin
|
0.7%
|
0.2%
|
50
bps
|
60
bps
|
|
|
|
|
|
Adjusting items to finance
costs
|
(7)
|
(7)
|
|
|
PBT
|
(10)
|
(44)
|
77%
|
80%
|
Adjusting items to tax
|
4
|
3
|
|
|
Loss after tax on continuing operations
|
(8)
|
(37)
|
78%
|
81%
|
EPS - total (continuing operations)
|
(0.7)p
|
(3.3)p
|
|
|
Cash flow
|
H1 2024/25
£m
|
H1
2023/24
(Restated)
£m
|
Reported
% change
|
Currency
neutral
%
change
|
Adjusted EBITDAR
|
173
|
172
|
1%
|
1%
|
Adjusted EBITDAR margin
|
4.4%
|
4.4%
|
-
|
(10)
bps
|
|
|
|
|
|
Cash payments of leasing costs,
debt & interest1
|
(122)
|
(125)
|
|
|
Other non-cash items in
EBIT
|
10
|
8
|
|
|
Operating cash flow1
|
61
|
55
|
11%
|
9%
|
Operating cash flow
margin
|
1.6%
|
1.4%
|
20
bps
|
-
|
|
|
|
|
|
Capital expenditure
|
(22)
|
(21)
|
|
|
Adjusting items to cash
flow1
|
(10)
|
(21)
|
|
|
Free cash flow before working capital
|
29
|
13
|
123%
|
114%
|
Working capital
|
31
|
9
|
|
|
Segmental free cash flow
|
60
|
22
|
173%
|
165%
|
Cash tax paid
|
(2)
|
(4)
|
|
|
Cash interest paid
|
(8)
|
(14)
|
|
|
Free cash flow
|
50
|
4
|
1150%
|
920%
|
Dividend
|
-
|
-
|
|
|
Purchase of own shares - share
buyback
|
-
|
-
|
|
|
Purchase of own shares - employee
benefit trust
|
(10)
|
(2)
|
|
|
Pension
|
(25)
|
(18)
|
|
|
Disposals including discontinued
operations
|
(4)
|
(14)
|
|
|
Other
|
-
|
(2)
|
|
|
Movement in net cash / (debt)
|
11
|
(32)
|
|
|
|
|
|
|
|
Net cash / (debt)
|
107
|
(129)
|
|
|
1 APM defined in Glossary
UK & Ireland
|
26 October
2024
|
28
October 2023
|
Number of stores
|
|
|
UK
|
282
|
284
|
Ireland
|
16
|
16
|
Total UK&I
|
298
|
300
|
|
|
|
Selling space '000 sq. ft
|
|
|
UK
|
5,223
|
5,235
|
Ireland
|
207
|
207
|
Total UK&I
|
5,430
|
5,442
|
|
H1 2024/25
£m
|
H1
2023/24
£m
|
Reported
%
change
|
Currency
neutral % change
|
Income Statement
|
|
|
|
|
Revenue
|
2,342
|
2,215
|
6%
|
6%
|
Online share of revenue
|
45%
|
43%
|
2%
|
|
|
|
|
|
|
Adjusted EBITDA
|
97
|
92
|
5%
|
5%
|
Adjusted EBITDA margin
|
4.1%
|
4.2%
|
(10)
bps
|
(10)
bps
|
|
|
|
|
|
Depreciation on right-of-use
assets
|
(49)
|
(48)
|
|
|
Depreciation on other
assets
|
(8)
|
(9)
|
|
|
Amortisation
|
(17)
|
(20)
|
|
|
Adjusted EBIT
|
23
|
15
|
53%
|
53%
|
Adjusted EBIT margin
|
1.0%
|
0.7%
|
30
bps
|
30
bps
|
|
|
|
|
|
Adjusting items to
EBIT2
|
(6)
|
(16)
|
|
|
EBIT
|
17
|
(1)
|
|
|
EBIT margin
|
0.7%
|
(0.0)%
|
70
bps
|
70
bps
|
|
|
|
|
|
Cash flow
|
|
|
|
|
Adjusted EBITDAR
|
99
|
96
|
3%
|
3%
|
Adjusted EBITDAR margin
|
4.2%
|
4.3%
|
(10)
bps
|
(10)
bps
|
|
|
|
|
|
Cash payments of leasing costs,
debt & interest1
|
(74)
|
(76)
|
|
|
Other non-cash items in
EBIT
|
9
|
8
|
|
|
Operating cash flow1
|
34
|
28
|
21%
|
21%
|
Operating cash flow
margin
|
1.5%
|
1.3%
|
20
bps
|
10 bps
|
|
|
|
|
|
Capital expenditure
|
(15)
|
(12)
|
|
|
Adjusting items to cash
flow1,2
|
(9)
|
(16)
|
|
|
Free cash flow before working capital
|
10
|
-
|
|
|
Working capital
|
54
|
(15)
|
|
|
Segmental free cash flow
|
64
|
(15)
|
|
|
1 APM defined in Glossary. 2 Prior period restated to
exclude discontinued operation costs
Total UK&I sales increased +6%, driven by
like-for-like sales growth of +5%. The online share of business
increased +2%pts to 45%.
Mobile was the strongest performing category,
growing double digits YoY, with growth in iD Mobile and
handset-only sales. Consumer electronics saw good growth, boosted
by England's performance in EURO 2024 and Computing sales were also
positive, with AI technology sales building momentum. This was all
assisted by additional marketing to drive sales. Domestic appliance
sales declined in a weak market.
The UK market (excluding Mobile) declined (1.4)%
during H1 and our market share grew +20bps compared to last year as
we grew share in the store channel by +180bps while our online
market share was broadly stable at (10)bps YoY.
Gross margins increased +10bps compared to last
year, and +180bps compared to three years ago as a result of the
ongoing strategic focus. Operating costs increased as inflationary
pressures on wages and business rates were not fully offset by cost
saving, there was additional marketing to drive profitable
sales and an increased level of investment spending, with
additional investment planned for the second half of the year. The
investment spend is broadly evenly split between capital and
operating expenditure, which is a significant change to even a few
years ago when the majority was capitalised. Although
absolute costs were higher year-on-year, operating leverage meant
that the operating expense to sales ratio improved by
+20bps.
Adjusted EBIT increased to £23m at 1.0% margin,
up +30bps YoY.
In the period, adjusting items to EBIT totalled
£(6)m, this was mainly the amortisation of acquisition intangibles
from the 2014 merger, which is a non-cash item. The cash costs
mainly relate to the ongoing costs of non-trading properties within
the strategic change programme.
|
H1 2024/25,
£m
|
H1
2023/24, £m
|
|
P&L
|
Cash
|
P&L
|
Cash
|
Acquisition / disposal related
items
|
(6)
|
-
|
(6)
|
-
|
Strategic change
programmes
|
(1)
|
(7)
|
(9) 2
|
(14)
|
Impairment losses and onerous
contracts
|
-
|
(1)
|
-
|
-
|
Regulatory
|
2
|
-
|
1
|
(2)
|
Other
|
(1)
|
(1)
|
(2)
|
-
|
Total
|
(6)
|
(9)
|
(16)
|
(16)
|
2 Prior period restated to exclude discontinued operation
costs
Operating cash flow increased +21% YoY largely
due to higher profits. Capital expenditure rose slightly YoY, but
was still significantly below the level of two years ago, as
continued investment discipline was coupled with a shift toward
more operating expense expenditure on projects. Adjusting items are
described above. Working capital cash inflow of £54m was a
significant improvement YoY as the natural benefit of sales growth
and internal process improvements more than offset the headwinds
from higher mobile sales. In combination, this resulted in
segmental free cash inflow of £64m, +£79m better than last
year.
Nordics
|
|
26 October
2024
|
|
28
October 2023
|
Number of stores
|
Own stores
|
Franchise
stores
|
Total
|
Own
stores
|
Franchise stores
|
Total
|
Norway
|
77
|
63
|
140
|
83
|
61
|
144
|
Sweden
|
94
|
78
|
172
|
98
|
75
|
173
|
Denmark
|
47
|
-
|
47
|
45
|
-
|
45
|
Finland
|
20
|
18
|
38
|
20
|
22
|
42
|
Other Nordics
|
-
|
16
|
16
|
-
|
16
|
16
|
Nordics
|
238
|
175
|
413
|
246
|
174
|
420
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling space '000 sq ft
|
Own stores
|
Franchise
stores
|
Total
|
Own
stores
|
Franchise stores
|
Total
|
Norway
|
1,044
|
649
|
1,693
|
1,098
|
611
|
1,709
|
Sweden
|
1,107
|
396
|
1,503
|
1,180
|
389
|
1,569
|
Denmark
|
788
|
-
|
788
|
753
|
-
|
753
|
Finland
|
508
|
166
|
674
|
508
|
196
|
704
|
Other Nordics
|
-
|
106
|
106
|
-
|
106
|
106
|
Nordics
|
3,447
|
1,317
|
4,764
|
3,539
|
1,302
|
4,841
|
|
|
|
|
|
|
|
|
|
|
H1 2024/25
£m
|
H1
2023/24
£m
|
Reported
%
change
|
Currency
neutral % change
|
Income Statement
|
|
|
|
|
Revenue
|
1,576
|
1,653
|
(5)%
|
(3)%
|
Online share of revenue
|
26%
|
25%
|
1%
|
|
|
|
|
|
|
Adjusted EBITDA
|
74
|
75
|
(1)%
|
3%
|
Adjusted EBITDA margin
|
4.7%
|
4.5%
|
20
bps
|
30
bps
|
|
|
|
|
|
Depreciation on right-of-use
assets
|
(40)
|
(40)
|
|
|
Depreciation on other
assets
|
(10)
|
(12)
|
|
|
Amortisation
|
(6)
|
(11)
|
|
|
Adjusted EBIT
|
18
|
12
|
50%
|
46%
|
Adjusted EBIT margin
|
1.1%
|
0.7%
|
40
bps
|
30
bps
|
|
|
|
|
|
Adjusting items to EBIT
|
(6)
|
(5)
|
|
|
EBIT
|
12
|
7
|
71%
|
63%
|
EBIT margin
|
0.8%
|
0.4%
|
40
bps
|
30
bps
|
|
|
|
|
|
Cash flow
|
|
|
|
|
Adjusted EBITDAR
|
74
|
76
|
(3)%
|
-
|
Adjusted EBITDAR margin
|
4.7%
|
4.6%
|
10
bps
|
10
bps
|
|
|
|
|
|
Cash payments of leasing costs,
debt & interest1
|
(48)
|
(49)
|
|
|
Other non-cash items in
EBIT
|
1
|
-
|
|
|
Operating cash flow
|
27
|
27
|
-
|
(3)%
|
Operating cash flow
margin
|
1.7%
|
1.6%
|
10
bps
|
-
|
|
|
|
|
|
Capital expenditure
|
(7)
|
(9)
|
|
|
Adjusting items to cash
flow
|
(1)
|
(5)
|
|
|
Free cash flow before working capital
|
19
|
13
|
46%
|
43%
|
Working capital
|
(23)
|
24
|
|
|
Segmental free cash flow
|
(4)
|
37
|
|
|
1 APM defined in Glossary
Revenue declined by (3)% on a currency neutral
basis, with a like-for-like sales decline of (2)%. Online share of
business increased slightly to 26%.
In a market that continued to trade poorly, all
product categories except consumer electronics experienced a sales
decline. Computing and domestic appliances were the worst
performing categories, while mobile proved more
resilient.
Compared to last year, the Nordic market
declined around (3.4)%. Our market share was 27.9% during the half,
up +40bps compared to last year as we maintained or took share in
every market except Finland.
Gross margin increased +80bps YoY to a level
that is +60bps higher than three years ago. Operating expenses
decreased slightly as inflationary cost increases were more than
offset by savings and efficiencies.
Adjusted EBIT increased to £18m at 1.1% margin,
up +40bps YoY.
In the period, adjusting items to EBIT totalled
£(6)m from the amortisation of acquisition intangibles which had no
cash impact. The cash costs of £(1)m related to the strategic cost
saving initiatives. EBIT increased to £12m.
|
H1 2024/25,
£m
|
H1
2023/24, £m
|
|
P&L
|
Cash
|
P&L
|
Cash
|
Acquisition / disposal related
items
|
(6)
|
-
|
(6)
|
-
|
Strategic change
programmes
|
-
|
(1)
|
1
|
(5)
|
Impairment losses and onerous
contracts
|
-
|
-
|
-
|
-
|
Total
|
(6)
|
(1)
|
(5)
|
(5)
|
The operating cash flow was flat YoY at £27m as higher profits were
offset by lower depreciation and amortisation. Capital expenditure
was £(7)m, with spend relatively evenly spread across our already
well-invested store estate, IT infrastructure and distribution
facilities. Working capital outflow of £(23)m was driven by lower
sales volumes, as payables decreased by more than inventory.
Overall, this drove segmental free cash flow of £(4)m, down £(41)m
YoY.
Finance Costs
Interest on lease liabilities was £(27)m, a slight decrease
on last year due to the fall in our overall lease commitments; the
cash impact of this interest is included within "Cash payments of
leasing costs, debt & interest" in segmental free cash
flow.
The adjusted net finance costs were lower than
last year as the company moved into an average net cash position.
The net cash impact of these costs was £(6)m, from £(13)m in the
prior year.
The finance costs on the defined benefit pension
scheme is an adjusting item and was broadly flat year-on-year in
line with the assumptions used in the valuation of the pension
obligations.
|
H1 2024/25
£m
|
H1
2023/24
(Restated)
£m
|
Interest on lease
liabilities
|
(27)
|
(30)
|
Finance income
|
4
|
2
|
Finance costs
|
(9)
|
(15)
|
Adjusted net finance costs
|
(32)
|
(43)
|
|
|
|
Finance costs on defined benefit
pension schemes
|
(4)
|
(5)
|
Other finance costs
|
(3)
|
(2)
|
Net finance costs on continuing operations
|
(39)
|
(50)
|
Tax
A tax rate of 25% has been applied to the adjusted half year
results. This is slightly higher than the prior half year adjusted
rate of 24% due to a lower proportion of Nordic losses. The cash
tax paid in the half year period was £2m, down from £4m in the
prior year which is primarily due to a Nordics rebate received in
relation to prior years.
The expected full year adjusted effective tax
rate at 25% is slightly lower than the prior full year rate of 27%
due to a higher proportion of Nordics profits, which are taxed at a
slightly lower rate than the UK.
The half year adjusting items tax credit of £4m
includes the tax impact of non-headline items in the
Nordics.
Cash flow
|
H1 2024/25
£m
|
H1
2023/24
(Restated)
£m
|
Reported
%
change
|
Currency
neutral
%
change
|
Operating cash flow
|
61
|
55
|
11%
|
9%
|
Capital expenditure
|
(22)
|
(21)
|
|
|
Adjusting items to cash
flow
|
(10)
|
(21)
|
|
|
Free cash flow before working capital
|
29
|
13
|
123%
|
114%
|
Working capital and network
commissions
|
31
|
9
|
|
|
Segmental free cash flow
|
60
|
22
|
173%
|
165%
|
Cash tax paid
|
(2)
|
(4)
|
|
|
Cash interest paid
|
(8)
|
(14)
|
|
|
Free cash flow
|
50
|
4
|
1150%
|
920%
|
Dividend
|
-
|
-
|
|
|
Purchase of own shares
|
(10)
|
(2)
|
|
|
Pension
|
(25)
|
(18)
|
|
|
Disposals including discontinued
operations
|
(4)
|
(14)
|
|
|
Other
|
-
|
(2)
|
|
|
Movement in net cash
|
11
|
(32)
|
|
|
|
|
|
|
|
Opening net cash /
(debt)
|
96
|
(97)
|
|
|
Closing net cash / (debt)
|
107
|
(129)
|
|
|
|
|
|
|
|
Segmental free cash flow was an inflow of £60m (H1 2023/24:
inflow of £22m) mainly due to improvements in working capital and a
reduction in adjusting items. Interest and tax outflows totalled
£(10)m as described above, resulting in a free cash inflow of £50m
(H1 2023/24: inflow of £4m).
No dividend was paid in the period, in line
with the previous year. The employee
benefit trust acquired £10m worth of shares to satisfy colleague
share awards.
Pension contributions of £25m
(H1 2023/24: £18m) were in line with the
contribution plan agreed with the pension fund Trustees.
Other movements in the prior year predominantly
relate to currency translation
differences, which did not repeat this year.
The closing net cash
position was £107m, compared to a net cash position of £96m at 27
April 2024. This included £28m of restricted cash (28 October 2023:
£27m).
Balance sheet
|
26 October
2024
Group
|
28
October 2023
Group
Excluding Greece
|
27 April
2024
Group
|
|
£m
|
£m
|
£m
|
Goodwill
|
2,216
|
2,252
|
2,237
|
Other fixed assets
|
1,065
|
1,255
|
1,156
|
Working capital
|
(196)
|
(231)
|
(163)
|
Net cash / (debt)
|
107
|
(182)
|
96
|
Net lease liabilities
|
(931)
|
(1,054)
|
(999)
|
Pension
|
(143)
|
(188)
|
(171)
|
Deferred tax
|
10
|
10
|
8
|
Provisions
|
(69)
|
(39)
|
(72)
|
Other
|
(19)
|
(31)
|
(20)
|
Net assets
|
2,040
|
1,792
|
2,072
|
Goodwill declined
£(36)m during the half-year ended 26 October 2024 due to currency
revaluation of the Nordics goodwill.
Other fixed assets
decreased by £(91)m since 27 April 2024 as capital expenditure was
more than offset by depreciation and amortisation of
£(41)m.
|
26 October
2024
Group
|
28
October 2023
Group
Excluding Greece
|
27 April
2024
Group
|
|
£m
|
£m
|
£m
|
Inventory
|
1,328
|
1,421
|
1,034
|
Trade Receivables
|
208
|
280
|
195
|
Trade Payables
|
(1,633)
|
(1,749)
|
(1,180)
|
Trade working capital
|
(97)
|
(48)
|
49
|
Network commission receivables
& contract assets
|
70
|
97
|
66
|
Network accrued income
|
208
|
140
|
187
|
Network receivables
|
278
|
237
|
253
|
Other Receivables
|
335
|
224
|
269
|
Other Payables
|
(718)
|
(653)
|
(743)
|
Derivatives
|
6
|
9
|
9
|
Working capital
|
(196)
|
(231)
|
(163)
|
At period end, total working capital was
£(196)m (28 October 2023: £(231)m). Group inventory was £1,328m,
(7)% lower than last year driven almost entirely by lower holdings
in the Nordics, due to the lower sales and slightly later timing of
promotional periods. The group's stock days increasing from 62 to
63 compared to 28 October 2023. Trade payables decreased by £116m
to £(1,633)m (28 October 2023: £(1,749)m) in line with the lower
stock holding.
Total network receivables are up by £25m
compared to year end with an increase in iD Mobile, driven by
higher volume of sales, offset by a decrease in Vodafone. Other
receivables are up by £111m year-on-year due to timing of
collections from suppliers, as well as higher accrued income with
an offsetting decrease in trade receivables. Other payables
increased by £65m due to the timing of VAT payable, as well as
higher accrued expenses with an offsetting decrease in trade
payables.
Lease liabilities are £123m lower than 28
October 2023 due to store exits and the renewal of leases at lower
average rent.
The IAS 19 accounting deficit of the defined
benefit pension scheme amounted to £143m (27 April 2024: £171m).
The reduction of £28m during the period was primarily driven by
£25m of contributions.
|
26 October
2024
|
28
October 2023
(Restated)
|
27 April
2024
|
|
£m
|
£m
|
£m
|
Net cash / (debt)
|
107
|
(182)
|
96
|
Restricted cash
|
(28)
|
(27)
|
(36)
|
Net lease liabilities
|
(931)
|
(1,054)
|
(999)
|
Pension liability
|
(143)
|
(188)
|
(171)
|
Total closing indebtedness
|
(995)
|
(1,451)
|
(1,110)
|
Less: year-end net cash /
(debt)
|
(107)
|
182
|
(96)
|
Add: average net cash /
(debt)
|
73
|
(208)
|
(69)
|
Total average indebtedness
|
(1,029)
|
(1,477)
|
(1,275)
|
|
26 October
2024
|
28
October 2023
(Restated)
|
27 April
2024
|
|
£m
|
£m
|
£m
|
Operating cashflow
(last 12 months)
|
252
|
267
|
246
|
Cash payments of leasing costs,
debt & interest
|
244
|
284
|
247
|
Operating cash flow plus cash
payments of leasing
|
496
|
551
|
493
|
|
|
|
|
Bank covenant
ratios
|
|
|
|
Fixed charges (cash lease costs +
cash interest)
|
265
|
311
|
274
|
Fixed charge cover
|
1.87x
|
1.77x
|
1.80x
|
|
|
|
|
Net (debt)/cash excluding
restricted funds
|
79
|
(209)
|
60
|
Net debt leverage
|
(0.31)x
|
0.78x
|
(0.24)x
|
|
|
|
|
Net indebtedness
ratios
|
|
|
|
Fixed charges (cash lease costs +
cash interest + pension contributions)
|
308
|
368
|
310
|
Total indebtedness fixed charge cover
|
1.61x
|
1.50x
|
1.59x
|
|
|
|
|
Total closing
indebtedness
|
(995)
|
(1,451)
|
(1,110)
|
Total indebtedness leverage
|
2.01x
|
2.63x
|
2.25x
|
At 26 October 2024 the Group had net cash of
£107m (28 October 2023: net debt of £(182)m) and average net cash
for the period of £73m (H1 2023/24: average net debt of
£(208)m).
During the period, the Group refreshed its
revolving credit facility and now has access to a £525m facility
that expires in September 2028 (with an option to extend for an
additional year) with a syndicate of six banks. The covenants on
the debt facilities are net debt leverage <2.5x (H1 2024/25:
(0.31)x) and fixed charge cover >1.5x (H1 2024/25:
1.87x).
Provisions primarily relate to property,
reorganisation and sales provisions. The balance reduced by £3m
during the year as the utilisation of reorganisation provisions for
central operations and property related onerous contract costs for
closed stores more than offset additions. Regulatory provisions of
£2m were released during the period due to updates to estimated
obligations.
Share count
The weighted average number of shares used for
basic earnings decreased by 17m to 1,089m since the previous year
end due to an increase in the average number of shares held by the
Group EBT to satisfy colleague shareholder scheme.
The dilutive effect of share options and other
incentive schemes has increased due to improved scheme performance
against vesting conditions.
|
|
26 October
2024
|
28
October 2023
|
27 April
2024
|
|
|
Million
|
Million
|
Million
|
Weighted average number of
shares
|
|
|
|
|
Average shares in
issue
|
|
1,133
|
1,133
|
1,133
|
Less average holding by Group EBT
and treasury shares held by Company
|
|
(44)
|
(25)
|
(27)
|
For basic earnings / (loss) per share
|
|
1,089
|
1,108
|
1,106
|
Dilutive effect of share options
and other incentive schemes
|
|
46
|
18
|
22
|
Number of shares for diluted earnings per
share
|
|
1,135
|
1,126
|
1,128
|
|
Note
|
26 weeks ended
26 October
2024
Unaudited
£m
|
(Restated)*
26 weeks ended
28 October
2023
Unaudited
£m
|
52
weeks
ended
27
April
2024
Audited
£m
|
Continuing Operations
|
|
|
|
|
Revenue
|
2
|
3,918
|
3,868
|
8,476
|
|
|
|
|
|
Profit before interest and
tax
|
2
|
29
|
6
|
117
|
|
|
|
|
|
Finance income
|
|
4
|
2
|
4
|
Finance costs
|
|
(43)
|
(52)
|
(93)
|
Net finance costs
|
|
(39)
|
(50)
|
(89)
|
|
|
|
|
|
(Loss) / profit before tax
|
|
(10)
|
(44)
|
28
|
|
|
|
|
|
Income tax credit /
(expense)
|
|
2
|
7
|
(1)
|
(Loss) / profit after tax for the period from continuing
operations
|
|
(8)
|
(37)
|
27
|
|
|
|
|
|
Profit / (loss) after tax for the period from discontinued
operations
|
7
|
-
|
(2)
|
138
|
|
|
|
|
|
(Loss) / profit
after tax for the period
|
|
(8)
|
(39)
|
165
|
|
|
|
|
|
Earnings per share (pence)
|
3
|
|
|
|
Basic - continuing
operations
|
|
(0.7)p
|
(3.3)p
|
2.4p
|
Diluted - continuing
operations
|
|
(0.7)p
|
(3.3)p
|
2.4p
|
|
|
|
|
|
Basic - total
|
|
(0.7)p
|
(3.5)p
|
14.9p
|
Diluted - total
|
|
(0.7)p
|
(3.5)p
|
14.6p
|
|
|
|
|
|
* The prior period has been
restated to exclude discontinued operations
|
|
26 weeks ended
26 October 2024
Unaudited
£m
|
(Restated)*
26 weeks
ended
28 October 2023
Unaudited
£m
|
52
weeks
ended
27 April
2024
Audited
£m
|
(Loss) / profit
after tax for the period
|
|
(8)
|
(39)
|
165
|
|
|
|
|
|
Items that may be reclassified to the income statement in
subsequent periods:
|
|
|
|
|
Cash flow hedges
|
|
|
|
|
Fair value movements recognised in
other comprehensive income
|
|
(1)
|
5
|
4
|
Reclassified and reported in
income statement
|
|
3
|
1
|
6
|
Tax on movements in cash flow
hedges
|
|
-
|
-
|
(1)
|
Exchange loss arising on
translation of foreign operations
|
|
(27)
|
(20)
|
(41)
|
Reclassification of foreign
currency translation differences due to disposal of
foreign operations
|
|
-
|
-
|
(1)
|
|
|
(25)
|
(14)
|
(33)
|
|
|
|
|
|
Items that will not be reclassified to the income statement
in subsequent periods:
|
|
|
|
|
Actuarial gain on defined benefit
pension schemes
|
|
|
7
|
47
|
52
|
Tax on movements on defined
benefit pension schemes
|
|
(2)
|
(3)
|
5
|
|
|
5
|
44
|
57
|
|
|
|
|
|
Other comprehensive (expense) /
income for the period (taken to equity)
|
|
(20)
|
30
|
24
|
|
|
|
|
|
Total comprehensive (expense) /
income for the period - continuing operations
|
|
(28)
|
(7)
|
52
|
Total comprehensive (expense) /
income for the period - discontinued operations
|
|
-
|
(2)
|
137
|
|
|
|
|
|
Total comprehensive (expense) /
income for the period
|
|
(28)
|
(9)
|
189
|
|
|
|
|
|
|
|
|
|
|
|
* The prior period has been
restated to exclude discontinued operations
|
Note
|
26 October 2024 Unaudited
£m
|
28 October 2023 Unaudited
£m
|
27 April 2024 Audited
£m
|
Non-current assets
|
|
|
|
|
Goodwill
|
|
2,216
|
2,252
|
2,237
|
Intangible assets
|
|
222
|
317
|
246
|
Property, plant &
equipment
|
|
106
|
138
|
111
|
Right-of-use assets
|
|
737
|
911
|
799
|
Lease receivable
|
|
2
|
4
|
3
|
Trade and other
receivables
|
|
94
|
114
|
101
|
Deferred tax assets
|
|
19
|
25
|
20
|
|
|
3,396
|
3,761
|
3,517
|
Current assets
|
|
|
|
|
Inventory
|
|
1,328
|
1,564
|
1,034
|
Lease receivable
|
|
1
|
1
|
1
|
Trade and other
receivables
|
|
727
|
720
|
616
|
Income tax receivable
|
|
4
|
4
|
3
|
Derivative assets
|
|
12
|
21
|
13
|
Cash and cash
equivalents
|
|
108
|
94
|
125
|
|
|
2,180
|
2,404
|
1,792
|
Total assets
|
|
5,576
|
6,165
|
5,309
|
Current liabilities
|
|
|
|
|
Trade and other
payables
|
|
(2,252)
|
(2,524)
|
(1,809)
|
Derivative liabilities
|
|
(6)
|
(12)
|
(4)
|
Income tax payable
|
|
(23)
|
(36)
|
(23)
|
Loans and other
borrowings
|
6
|
(1)
|
(5)
|
(29)
|
Lease liabilities
|
|
(201)
|
(173)
|
(202)
|
Provisions
|
|
(61)
|
(36)
|
(64)
|
|
|
(2,544)
|
(2,786)
|
(2,131)
|
Non-current liabilities
|
|
|
|
|
Trade and other
payables
|
|
(99)
|
(103)
|
(114)
|
Loans and other
borrowings
|
6
|
-
|
(218)
|
-
|
Lease liabilities
|
|
(733)
|
(968)
|
(801)
|
Retirement benefit
obligations
|
5
|
(143)
|
(190)
|
(171)
|
Deferred tax
liabilities
|
|
(9)
|
(11)
|
(12)
|
Provisions
|
|
(8)
|
(3)
|
(8)
|
|
|
(992)
|
(1,493)
|
(1,106)
|
Total liabilities
|
|
(3,536)
|
(4,279)
|
(3,237)
|
Net assets
|
|
2,040
|
1,886
|
2,072
|
Capital and reserves
|
|
|
|
|
Share capital
|
|
1
|
1
|
1
|
Share premium account
|
|
2,263
|
2,263
|
2,263
|
Other reserves
|
|
(880)
|
(815)
|
(844)
|
Accumulated profits
|
|
656
|
437
|
652
|
Equity attributable to equity
holders of the parent company
|
|
2,040
|
1,886
|
2,072
|
|
Note
|
Share
capital
£m
|
Share
premium account
£m
|
Other reserves
£m
|
Accumulated profits
£m
|
Total
equity
£m
|
At 27 April 2024
|
|
1
|
2,263
|
(844)
|
652
|
2,072
|
Loss for the period
|
|
-
|
-
|
-
|
(8)
|
(8)
|
Other comprehensive (expense) /
income recognised directly in equity
|
|
-
|
-
|
(24)
|
4
|
(20)
|
Total comprehensive expense
for the period
|
|
-
|
-
|
(24)
|
(4)
|
(28)
|
Amounts transferred to the
carrying value of inventory purchased during the year
|
|
-
|
-
|
(3)
|
-
|
(3)
|
Net movement in relation to share
schemes
|
|
-
|
-
|
1
|
8
|
9
|
Purchase of own shares - employee
benefit trust
|
|
-
|
-
|
(10)
|
-
|
(10)
|
Equity dividends
|
4
|
-
|
-
|
-
|
-
|
-
|
At 26 October 2024
|
|
1
|
2,263
|
(880)
|
656
|
2,040
|
|
Note
|
Share
capital
£m
|
Share
premium account
£m
|
Other reserves
£m
|
Accumulated profits
£m
|
Total
equity
£m
|
At 29 April 2023
|
|
1
|
2,263
|
(804)
|
432
|
1,892
|
Loss for the period
|
|
-
|
-
|
-
|
(39)
|
(39)
|
Other comprehensive (expense) /
income recognised directly in equity
|
|
-
|
-
|
(14)
|
44
|
30
|
Total comprehensive (expense) /
income
for the period
|
|
-
|
-
|
(14)
|
5
|
(9)
|
Amounts transferred to the
carrying value of inventory purchased during the year
|
|
-
|
-
|
(4)
|
-
|
(4)
|
Net movement in relation to share
schemes
|
|
-
|
-
|
9
|
-
|
9
|
Purchase of own shares - employee
benefit trust
|
|
-
|
-
|
(2)
|
-
|
(2)
|
Equity dividends
|
4
|
-
|
-
|
-
|
-
|
-
|
At 28 October 2023
|
|
1
|
2,263
|
(815)
|
437
|
1,886
|
|
|
Share
capital
£m
|
Share
premium account
£m
|
Other reserves
£m
|
Accumulated profits
£m
|
Total
equity
£m
|
At 29 April 2023
|
|
1
|
2,263
|
(804)
|
432
|
1,892
|
Profit for the period
|
|
-
|
-
|
-
|
165
|
165
|
Other comprehensive (expense) /
income recognised directly in equity
|
|
-
|
-
|
(32)
|
56
|
24
|
Total comprehensive (expense) /
income for the period
|
|
-
|
-
|
(32)
|
221
|
189
|
Amounts transferred to the
carrying value of inventory purchased during the year
|
|
-
|
-
|
(5)
|
-
|
(5)
|
Amounts transferred to accumulated
profits
|
|
-
|
-
|
(1)
|
1
|
-
|
Net movement in relation to share
schemes
|
|
-
|
-
|
10
|
(2)
|
8
|
Purchase of own shares - employee
benefit trust
|
|
-
|
-
|
(12)
|
-
|
(12)
|
Equity dividend
|
4
|
-
|
-
|
-
|
-
|
-
|
At 27 April 2024
|
|
1
|
2,263
|
(844)
|
652
|
2,072
|
|
|
Note
|
26 weeks
ended
26 October 2024
Unaudited
£m
|
(Restated)*
26 weeks
ended
28 October 2023
Unaudited
£m
|
52 weeks
ended
27 April
2024
Audited
£m
|
Operating activities
|
|
|
|
|
|
Cash generated from
operations
|
|
6
|
206
|
166
|
419
|
Special contributions to defined
benefit pension scheme
|
|
|
(25)
|
(18)
|
(36)
|
Income tax paid
|
|
|
(2)
|
(4)
|
(7)
|
Net cash flows from operating activities - continuing
operations
|
|
|
179
|
144
|
376
|
Net cash flows from operating
activities - discontinued operations
|
|
|
-
|
6
|
(10)
|
Net cash flows from operating activities
|
|
|
179
|
150
|
366
|
Investing activities
|
|
|
|
|
|
Acquisition of property, plant
& equipment and other intangibles
|
|
|
(22)
|
(19)
|
(48)
|
Net cash flows from investing activities - continuing
operations
|
|
|
(22)
|
(19)
|
(48)
|
Net cash flows from investing
activities - discontinued operations
|
|
|
-
|
(7)
|
(11)
|
Net cash flows from investing
activities - discontinued operations: proceeds on sale of
business
|
|
|
(4)
|
(2)
|
202
|
Net cash flows from investing activities
|
|
|
(26)
|
(28)
|
143
|
Financing activities
|
|
|
|
|
|
Interest paid
|
|
|
(34)
|
(43)
|
(87)
|
Capital repayment of lease
liabilities
|
|
|
(97)
|
(96)
|
(195)
|
Purchase of own shares - employee
benefit trust
|
|
|
(10)
|
(2)
|
(12)
|
Equity dividends paid
|
|
4
|
-
|
-
|
-
|
Drawdown / (repayment) of
borrowings
|
|
|
-
|
37
|
(178)
|
Cash inflows / (outflows) from
derivative financial instruments
|
|
|
-
|
3
|
(3)
|
Facility arrangement fees
paid
|
|
|
-
|
-
|
(1)
|
Net cash flows from financing activities - continuing
operations
|
|
|
(141)
|
(101)
|
(476)
|
Net cash flows from financing
activities - discontinued operations
|
|
|
-
|
(9)
|
(17)
|
Net cash flows from financing activities
|
|
|
(141)
|
(110)
|
(493)
|
|
|
|
|
|
|
Increase in cash and cash equivalents and bank
overdrafts
|
|
|
12
|
12
|
16
|
|
|
|
|
|
|
Cash and cash equivalents and bank
overdrafts at beginning of the period
|
|
|
96
|
81
|
81
|
Currency translation
differences
|
|
|
(1)
|
(4)
|
(1)
|
Cash and cash equivalents and bank overdrafts at end of the
period
|
|
|
107
|
89
|
96
|
* The prior period has been
restated to exclude discontinued operations
1 Accounting policies
(a) Basis of preparation
The interim financial information
for the 26 weeks ended 26 October 2024 was approved by the
directors on 11 December 2024. The interim financial
information, which is a condensed set of financial statements, has
been prepared in accordance with the Listing Rules of the Financial
Conduct Authority and International Accounting Standard 34
"Interim Financial
Reporting" (IAS 34) as adopted by the UK and has been
prepared on the going concern basis as described further below and
in the section on risks to achieving the Group's
objectives.
The accounting policies adopted
are those set out in the Group's Annual Report and Accounts
2023/24 which were prepared in
accordance with IFRS as adopted by the UK. New accounting
standards, amendments to standards and IFRIC interpretations which
became applicable during the period were either not relevant or had
no impact on the Group's net results or net assets.
The UK Endorsement Board has
adopted 'International Tax Reform - Pillar Two Model Rules
(Amendments to IAS 12)' which was issued by the International
Accounting Standards Board in May 2023. The Amendments introduce a
temporary mandatory exception from accounting for deferred taxes
arising from the Pillar Two model rules. The Group confirms that
this mandatory exception has been applied. Note that the Pillar 2
model rules were effective in the UK from 1 January 2024, and apply
to the Group for the first time in the accounting period ended 3
May 2025. The Group does not expect the rules to have a material
impact on the financial statements.
Going Concern
Going concern is the basis of
preparation of the financial statements that assumes an entity will
remain in operation for a period of at least 12 months from the
date of approval of these condensed financial
statements.
In their consideration of going
concern, the directors have reviewed the Group's future cash
forecasts and profit projections, which are based on market data
and past experience. The debt facilities modelled in the base case
total £525m, post renewal in September 2024.
As a result of the uncertainties
surrounding the forecasts due to the current macroeconomic
environment, the Group has also modelled a severe but plausible
downside scenario by applying a sales risk of 5% per annum across
the 3 year viability period from 2024/25 to 2027/28. This sales
risk can be offset with controllable mitigations across various
operating expense line items and hence in this severe but plausible
downside scenario, the Group does not breach any of the Group's
facilities or banking covenants. Finally, the Group has numerous
other mitigations available (in addition to those applied to the
severe but plausible downside scenario) which are considered
controllable should sales drop below the severe but plausible
downside, before requiring additional sources of financing in
excess of those that are committed. Such a scenario, and the
sequence of events which could lead to it, is considered to be
remote.
The directors are of the opinion
that the Group's forecasts and projections, which take into account
reasonably possible changes in trading performance including the
impact of increased uncertainty and inflation in the wider economic
environment, show that the Group is able to operate within its
current facilities and comply with its banking covenants for at
least 12 months from the date of approval of these financial
statements. In arriving at their conclusion that the Group has
adequate financial resources, the directors considered the level of
borrowings and facilities and that the Group has a robust policy
towards liquidity and cash flow management.
For this reason, the Board
considers it appropriate for the Group to adopt the going concern
basis in preparing the financial information. The long-term effect
of macroeconomic factors is uncertain and should the impact on
trading conditions be more prolonged or severe than what the
directors consider to be reasonably possible, the Group would need
to implement additional operational or financial
measures.
1 Accounting policies
(continued)
(a) Basis of preparation (continued)
Alternative performance measures
In addition to IFRS measures, the
Group uses certain alternative performance measures that are
considered to be additional informative measures of ongoing trading
performance of the Group and are consistent with how performance is
measured internally. The alternative performance measures used by
the Group are included within the glossary and definitions section.
This includes further information on the definitions, purpose and
reconciliations to IFRS measures of those alternative performance
measures that are used for internal reporting and presented to the
Group's Chief Operating Decision Maker (CODM). The CODM has been
determined to be the Board.
Further information
The interim financial information
uses definitions that are set out within the glossary and
definitions section of this document.
The interim financial information
is unaudited and does not constitute statutory accounts within the
meaning of Section 434 of the Companies Act 2006 but has been
reviewed by the auditor. The financial information for the
year ended 27 April 2024 does not constitute the company's
statutory accounts for that period but has been extracted from
those accounts which have been filed with the Registrar of
Companies and are also available on the Group's corporate
website www.currysplc.com.
(b) Key sources of estimation uncertainty and critical
accounting judgements
Critical accounting judgements and
estimates used in the preparation of the financial statements are
continually reviewed and revised as necessary. Whilst every effort
is made to ensure that such judgements and statements are
reasonable, by their nature they are uncertain and as such changes
may have a material impact.
In preparing the condensed
consolidated financial statements, the significant judgements made
by management in applying the Group's accounting policies and key
sources of estimation uncertainty include the
impairment of goodwill as disclosed below. In addition, key sources of estimation
uncertainty regarding UK defined benefit pension scheme assumptions
and critical accounting judgements related to taxation detailed in
the Group's Annual Report and Accounts 2023/24 remain
relevant.
Impairment of non-financial assets -
Goodwill
As required by IAS 36, goodwill is
subject to an impairment review on an annual basis, or more
frequently where indicators of impairment exist. The Group has
considered if indicators of impairment exist with regard to a
number of factors, including the recent changes to interest rates,
ongoing uncertainty in the wider macroeconomic environment and
internal cash forecasts. Management concluded that none these
factors are indicators of impairment and consequently, an
impairment review per IAS 36 has not been undertaken in the 26
weeks ended 26 October 2024.
2 Segmental analysis
The Group's operating segments
reflect the segments routinely reviewed by the CODM used to manage
performance and allocate resources. This information is
predominantly based on geographical areas which are either managed
separately or have similar trading characteristics.
The Group's operating and
reportable segments have therefore been identified as
follows:
·
UK & Ireland; comprising of Currys, iD Mobile
and B2B operations;
·
Nordics; operates stores in Norway, Sweden,
Finland and Denmark with franchise operations in Norway, Sweden,
Finland, Iceland, Greenland and Faroe Islands;
UK & Ireland and Nordics are
involved in the sale of consumer electronics and mobile technology
products and services, primarily through stores or online
channels.
Transactions between segments are
on an arm's length basis.
(a) Segmental results
26 weeks ended 26 October
2024
|
|
UK &
Ireland
£m
|
Nordics
£m
|
Total
£m
|
Revenue
|
2,342
|
1,576
|
3,918
|
Profit before interest and
tax
|
17
|
12
|
29
|
Finance income
|
|
|
4
|
Finance costs
|
|
|
(43)
|
Loss before tax
|
|
|
(10)
|
Depreciation and
amortisation
|
(79)
|
(63)
|
(142)
|
26 weeks
ended 28 October 2023 (Restated)*
|
|
UK &
Ireland
£m
|
Nordics
£m
|
Total
£m
|
Revenue
|
2,215
|
1,653
|
3,868
|
(Loss)/profit before interest and
tax
|
(1)
|
7
|
6
|
Finance income
|
|
|
2
|
Finance costs
|
|
|
(52)
|
Loss before tax
|
|
|
(44)
|
Depreciation and
amortisation
|
(83)
|
(69)
|
(152)
|
* The prior period has been
restated to exclude discontinued operations
52
weeks ended 27 April 2024
|
|
UK &
Ireland
£m
|
Nordics
£m
|
Total
£m
|
Revenue
|
4,970
|
3,506
|
8,476
|
Profit before interest and
tax
|
88
|
29
|
117
|
Finance income
|
|
|
4
|
Finance costs
|
|
|
(93)
|
Profit before tax
|
|
|
28
|
Depreciation and
amortisation
|
(163)
|
(136)
|
(299)
|
2 Segmental analysis (continued)
(a) Segmental results (continued)
Segmental
profit
|
|
|
|
Note
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
UK & Ireland
|
|
|
|
|
17
|
(1)
|
88
|
Nordics
|
|
|
|
|
12
|
7
|
29
|
Profit before interest and tax
|
|
|
|
|
29
|
6
|
117
|
Finance income
|
|
|
|
|
4
|
2
|
4
|
Finance costs
|
|
|
|
|
(43)
|
(52)
|
(93)
|
(Loss)/profit before tax
|
|
|
|
|
(10)
|
(44)
|
28
|
* The prior period has been
restated to exclude discontinued operations
(b) Seasonality
The Group's business is highly
seasonal, with a substantial proportion of its revenue and (loss) /
profit before interest and tax generated during its third quarter,
which includes Black Friday and the Christmas and New Year
season.
(c) Geographical information
Revenues are allocated to
countries according to the entity's country of domicile. Revenue by
destination is not materially different to that shown by domicile.
Non-current assets exclude financial instruments and deferred tax
assets.
|
26 weeks ended 26 October
2024
|
26 weeks ended 28 October 2023
(Restated)*
|
|
UK
£m
|
Norway
£m
|
Sweden
£m
|
Other
£m
|
Total
£m
|
UK
£m
|
Norway
£m
|
Sweden
£m
|
Other
£m
|
Total
£m
|
Revenue
|
2,262
|
471
|
507
|
678
|
3,918
|
2,140
|
488
|
528
|
712
|
3,868
|
Non-current assets at period end
|
1,942
|
422
|
399
|
586
|
3,349
|
2,059
|
491
|
403
|
595
|
3,548
|
* The prior period has been
restated to exclude discontinued operations
|
|
52 weeks ended 27 April
2024
|
|
|
|
|
|
|
UK
£m
|
Norway
£m
|
Sweden
£m
|
Other
£m
|
Total
£m
|
Revenue
|
|
|
|
|
|
4,784
|
1,039
|
1,140
|
1,513
|
8,476
|
Non-current assets at period
end
|
|
|
|
|
|
1,992
|
449
|
399
|
587
|
3,427
|
2 Segmental analysis (continued)
(d) Disaggregation of revenues
The Group's disaggregated revenue recognised
under 'Revenue from Contracts with Customers' in accordance with
IFRS 15 relates to the following operating segments and revenue
streams:
|
26 weeks ended 26 October
2024
|
26 weeks ended 28 October 2023
(Restated)*
|
|
UK & Ireland
£m
|
Nordics
£m
|
Total
£m
|
UK &
Ireland
£m
|
Nordics
£m
|
Total
£m
|
|
Sales of goods
|
1,997
|
1,430
|
3,427
|
1,901
|
1,512
|
3,413
|
|
Commission revenue
|
74
|
76
|
150
|
79
|
80
|
159
|
|
Support services
revenue
|
115
|
24
|
139
|
114
|
18
|
132
|
|
Other services revenue
|
155
|
46
|
201
|
119
|
43
|
162
|
|
Other revenue
|
1
|
-
|
1
|
2
|
-
|
2
|
|
Total revenue
|
2,342
|
1,576
|
3,918
|
2,215
|
1,653
|
3,868
|
|
|
|
|
|
|
|
|
|
|
|
* The prior period has been
restated to exclude discontinued operations
|
|
52 weeks ended 27 April
2024
|
|
|
|
|
|
UK &
Ireland
£m
|
Nordics
£m
|
Total
£m
|
|
Sales of
goods
|
|
|
|
|
4,296
|
3,208
|
7,504
|
|
Commission revenue
|
|
|
|
|
178
|
165
|
343
|
|
Support
services revenue
|
|
|
|
|
229
|
43
|
272
|
|
Other
services revenue
|
|
|
|
|
267
|
90
|
357
|
|
Total
revenue
|
|
|
|
|
4,970
|
3,506
|
8,476
|
|
|
|
|
|
|
|
|
|
|
|
3 (Loss) / earnings per share
|
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks
ended
27 April
2024
£m
|
(Loss) / profit for the period
attributable to equity shareholders - continuing
operations
|
|
(8)
|
(37)
|
27
|
(Loss) / profit for the period
attributable to equity shareholders - discontinued
operations
|
|
-
|
(2)
|
138
|
(Loss) / profit for the period - Total
|
|
(8)
|
(39)
|
165
|
|
|
|
|
|
|
|
Million
|
Million
|
Million
|
Weighted average number of shares
|
|
|
|
|
Average shares in issue
|
|
1,133
|
1,133
|
1,133
|
Less average holding by Group
EBT
|
|
(44)
|
(25)
|
(27)
|
For basic earnings per
share
|
|
1,089
|
1,108
|
1,106
|
Dilutive effect of share options
and other incentive schemes
|
|
46
|
18
|
22
|
For diluted (loss) / earnings per
share
|
|
1,135
|
1,126
|
1,128
|
|
|
|
|
|
|
|
Pence
|
Pence
|
Pence
|
Earnings per share
|
|
|
|
|
Basic (loss) / earnings per share
- continuing operations
|
|
(0.7)
|
(3.3)
|
2.4
|
Diluted (loss) / earnings per
share - continuing operations
|
|
(0.7)
|
(3.3)
|
2.4
|
|
|
|
|
|
Basic (loss) / earnings per share
- discontinued operations
|
|
-
|
(0.2)
|
12.5
|
Diluted (loss) / earnings per
share - discontinued operations
|
|
-
|
(0.2)
|
12.2
|
|
|
|
|
|
Basic (loss) / earnings per share
- total
|
|
(0.7)
|
(3.5)
|
14.9
|
Diluted (loss) / earnings per
share - total
|
|
(0.7)
|
(3.5)
|
14.6
|
* The prior period profit has been
restated to exclude discontinued operations
Basic and diluted (loss) / earnings
per share are based on the (loss) / profit after tax for the period
attributable to equity shareholders.
4 Dividends
There were no dividends paid
during the current or comparative periods, and there is currently
no proposed interim dividend for the period ending 26 October
2024.
5 Retirement
benefit obligations
|
|
|
26 October 2024
£m
|
28 October 2023
£m
|
27 April
2024
£m
|
Retirement benefit
obligations
|
- UK
|
|
|
(142)
|
(187)
|
(170)
|
|
-
Nordics
|
|
|
(1)
|
(1)
|
(1)
|
|
-
Greece
|
|
|
-
|
(2)
|
-
|
Net obligation
|
|
|
|
(143)
|
(190)
|
(171)
|
The Group operates a number of
defined contribution and defined benefit pension schemes. The
principal scheme operates in the UK and includes a funded defined
benefit section, the assets of which are held in a separate trustee
administered fund. The defined benefit section of the scheme was
closed to future accrual on 30 April 2010. The net obligations of
this scheme, calculated in accordance with IAS 19 "Employee
Benefits", are analysed as follows:
UK scheme
|
|
|
26 October 2024
£m
|
28 October 2023
£m
|
27 April
2024
£m
|
Fair value of plan
assets
|
|
|
991
|
869
|
955
|
Present value of defined benefit
obligations
|
|
|
(1,133)
|
(1,056)
|
(1,125)
|
Net obligation
|
|
|
(142)
|
(187)
|
(170)
|
The value of obligations is
particularly sensitive to the discount rate applied to liabilities
at the assessment date as well as mortality rates. The defined
benefit obligation has increased by £8m since 27 April 2024
primarily as a result of market conditions impacting the discount
rate assumption. The value of the plan assets is also sensitive to
market conditions and has increased by £36m due to an increase in
the value of liability-driven investments (LDI), which are designed
to broadly offset movements in the defined benefit obligation. The
scheme's investment strategy and its investment objectives remain
consistent with those adopted as at 27 April 2024.
The assumptions used in the
valuation of obligations are listed below:
UK scheme
|
|
26 October 2024
|
28 October 2023
|
27 April
2024
|
Rates per annum:
|
|
|
|
|
Discount rate
|
|
5.15%
|
5.70%
|
5.20%
|
Rate of increase in pensions in
payment
|
- pre
April 2006
|
2.95%
|
3.05%
|
3.00%
|
|
- post
April 2006
|
2.00%
|
2.15%
|
2.00%
|
Rate of increase in deferred
pensions (pre/post April 2006 accrual)
|
|
3.10%
|
3.15%
|
3.15%
|
Inflation
|
|
3.10%
|
3.15%
|
3.15%
|
Mortality rates are based on
historical experience and standard actuarial tables and include an
allowance for future improvements in longevity. Sensitivity testing
over life expectancy is not performed at the half year as it is not
considered as variable as discount rates and inflation.
If the discount rate assumption
increased by 1.0% the defined benefit obligation would decrease by
approximately £157m. If the assumption decreased by 1.0% the
defined benefit obligation would increase by approximately
£176m.
If the inflation assumption
increased by 1.0% the defined benefit obligation would increase by
approximately £132m. If the assumption decreased by 1.0% the
defined benefit obligation would decrease by approximately
£122m.
In June 2023, the High Court
handed down a decision in the case of Virgin Media Limited v NTL
Pension Trustees II Limited and others relating to the validity of
certain historical pension changes due to the lack of actuarial
confirmation required by law. In July 2024, the Court of Appeal
dismissed the appeal against aspects of the June 2023 decision. The
conclusions reached by the court in this case may have implications
for other UK defined benefit plans. The Trustees of the Scheme
received legal advice to consider the implications of the case for
the Scheme. Based on the legal advice received, the case does not
expose the Scheme to any new risks and, as such, there is no
allowance for the ruling in the results at 26 October
2024.
6 Note to the cash flow statement
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks
ended
27 April
2024
£m
|
Profit / (loss) before interest
and tax
|
29
|
6
|
117
|
Depreciation and
amortisation
|
142
|
152
|
299
|
Share-based payment
charge
|
10
|
7
|
8
|
Impairments and other non-cash
items
|
-
|
1
|
28
|
Operating cash flows before
movements in working capital
|
181
|
166
|
452
|
|
|
|
|
Movements in working
capital:
|
|
|
|
Increase in
inventory
|
(308)
|
(426)
|
(43)
|
Increase in
receivables
|
(111)
|
(51)
|
(36)
|
Increase in
payables
|
447
|
487
|
21
|
Decrease in provisions
|
(3)
|
(10)
|
25
|
|
25
|
-
|
(33)
|
Cash generated from continuing operations
|
206
|
166
|
419
|
* The prior period has been
restated to exclude discontinued operations
Restricted funds, which
predominantly comprise funds held by the Group's insurance business
for regulatory reserve requirements, were £28m (28 October 2023:
£27m; 27 April 2024: £36m). These restricted funds are included
within cash and cash equivalents on the face of the consolidated
balance sheet.
Cash flows from discontinued
operations comprise £4m of transactions fees related to the sale of
Dixons South East Europe A.E.V.E that were paid in the period (28
October 2023: £2m). In the period ended 27 April 2024 there is a
£202m cash inflow from discontinued operations which is comprised
of £205m disposal proceeds and £3m of transaction fees
paid.
Changes in
liabilities arising from financing activities
The table below details changes in
the Group's liabilities arising from financing activities,
including both cash and non-cash changes. Liabilities arising from
financing activities are those for which cash flows were, or future
cash flows will be, classified in the Group's consolidated cash
flow statement as cash flows from financing activities.
|
|
27
April
2024
£m
|
Financing
cash flows
£m
|
Lease
additions, modifications and disposals
£m
|
Foreign
Exchange
£m
|
Interest
£m
|
26
October
2024
£m
|
Loans and other
borrowings
|
|
-
|
5
|
-
|
-
|
(5)
|
-
|
Lease liabilities
|
|
(1,003)
|
124
|
(37)
|
9
|
(27)
|
(934)
|
Total liabilities arising from
financing activities
|
(1,003)
|
129
|
(37)
|
9
|
(32)
|
(934)
|
|
|
29
April
2023
£m
|
Financing
cash flows
£m
|
Lease
additions, modifications and disposals
£m
|
Foreign
Exchange
£m
|
Interest
£m
|
28
October
2023
£m
|
Loans and other
borrowings
|
|
(178)
|
(26)
|
-
|
(1)
|
(13)
|
(218)
|
Lease liabilities
|
|
(1,233)
|
136
|
(21)
|
10
|
(33)
|
(1,141)
|
Total liabilities arising from
financing activities
|
|
(1,411)
|
110
|
(21)
|
9
|
(46)
|
(1,359)
|
6 Note to the cash flow statement
(continued)
|
|
29
April
2023
£m
|
Financing
cash flows
£m
|
Lease
additions, modifications and disposals
£m
|
Foreign
Exchange
£m
|
Interest
£m
|
27
April
2024
£m
|
Loans and other
borrowings
|
|
(178)
|
197
|
4
|
(1)
|
(22)
|
-
|
Lease liabilities
|
|
(1,233)
|
275
|
1(i)
|
18
|
(64)
|
(1,003)
|
Total liabilities arising from
financing activities
|
|
(1,411)
|
472
|
5
|
17
|
(86)
|
(1,003)
|
i. This figure includes the
disposal of lease liabilities related to Greece of £81m
Lease liabilities are secured over
the Group's right-of-use assets.
Committed facilities
In September 2024, the Group
refinanced its existing debt with one revolving credit facility
which is due to expire in September 2028. This facility replaced
the two facilities which were due to expire in April 2026 and the
two short-term facilities which were due to expire in October 2024.
As at 26 October 2024 the available facilities totalled £525m (28
October 2023: £632m, 27 April 2024: £627m) and the Group had no
drawings (28 October 2023: £216m, 27 April 2024: £nil).
The interest rate payable for
drawings under the revolving credit facility is at a margin over
risk free rates (or other applicable interest basis) for the
relevant currency and for the appropriate period. The actual margin
applicable to any drawing depends on the fixed charges cover ratio
calculated in respect of the most recent accounting period. A
non-utilisation fee is payable in respect of amounts available but
undrawn under this facility and a utilisation fee is payable when
aggregate drawings exceed certain levels.
Uncommitted facilities
The Group also has overdrafts and
short-term money market lines from UK and European banks
denominated in various currencies, all of which are repayable on
demand. Interest is charged at the market rates applicable in the
countries concerned and these facilities are used to assist in
short term liquidity management. Total available facilities are
£56m (28 October 2023: £93m, 27 April 2024: £62m). At 26 October
2024 the Group had drawn down on the uncommitted facilities by £2m
(28 October 2023: £5m, 27 April 2024: £nil).
7 Discontinued operations
On 10 April 2024, Currys plc
(Currys) announced that it has completed the sale of Dixons South
East Europe A.E.V.E., the holding company of Currys entire Greece
and Cyprus retail business, trading as Kotsovolos, to Public Power
Corporation S.A. Consequently, Kotsovolos has been accounted for as
a discontinued operation for all periods up to 27 April 2024, the
results of which are detailed below. See note 6 for related cash
flows.
|
|
|
26 October 2024
£m
|
28 October 2023
£m
|
27 April
2024
£m
|
|
|
|
|
|
|
Revenue
|
|
|
-
|
291
|
579
|
Expenses
|
|
|
-
|
(293)
|
(577)
|
Profit before tax
|
|
|
-
|
(2)
|
2
|
|
|
|
|
|
|
Income tax expense
|
|
|
-
|
-
|
(2)
|
Profit after income tax of discontinued
operations
|
|
|
-
|
(2)
|
-
|
|
|
|
|
|
|
Gain on sale of the subsidiary
after income tax
|
|
|
-
|
-
|
138
|
Profit for the period from discontinued
operations
|
|
|
-
|
(2)
|
138
|
8 Contingent
liabilities
The Group continues to cooperate
with HMRC in relation to open tax cases arising from pre-merger
legacy corporate transactions in the former Carphone Warehouse
Group. It is possible that a future economic outflow will arise
from one of these matters, and therefore a contingent liability has
been disclosed. This determination is based on the strength of
third-party legal advice on the matter and therefore the Group
considers it 'more likely than not' that these enquiries will not
result in an economic outflow. The potential range of tax exposures
relating to this enquiry is estimated to be approximately £nil -
£218m excluding interest and penalties. Interest is £94m up to 26
October 2024. Penalties could range from nil to 30% of the
principal amount of any tax. Any potential cash outflow would occur
in greater than one year and less than five years.
The Group received a Spanish tax
assessment connected to a business that was disposed of by the
legacy Carphone Warehouse Group in 2014. This issue is in
litigation and is likely to take a minimum of two years to reach
resolution. The Group considers that it is not probable the claim
will result in an economic outflow based on third-party legal
advice. The maximum potential exposure as a result of the claim is
£11m.
9 Related party
transactions
Transactions between the Group's
subsidiary undertakings, which are related parties, have been
eliminated on consolidation and accordingly are not
disclosed.
The Group had the following
transactions and balances with its associates:
|
26 weeks ended
26 October
2024
£m
|
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
Revenue from sale of goods and
services
|
6
|
6
|
14
|
Amounts owed to the
Group
|
1
|
1
|
1
|
All transactions entered into with
related parties were completed on an arm's length basis.
10 Events after the balance
sheet date
There were no material events after the
balance sheet date.
The Board continually reviews and monitors the
risks and uncertainties which could have a material effect on the
Group's results. The Group's risks, and the factors which mitigate
them, are set out in more detail in the Principal risks and
uncertainties section of the Annual Report and Accounts 2023/24 and
remain relevant, but have evolved, in the current
period.
The updated risks and uncertainties are listed
below:
1. Supply Chain
Resilience risk covers broad external supply chain related
challenges for sourcing which, if not managed adequately, could
result in a deterioration of financial performance;
2. Failure to
deliver an effective business transformation programme in response
to a changing consumer environment and competitive landscape could
result in a loss of competitive advantage impacting financial
performance;
3. Failure to
comply with Financial Services regulation could result in
reputational damage, customer compensation, financial penalties and
a resultant deterioration in financial performance;
4. Failure to
safeguard sensitive colleague, customer, or business information,
or a failure to comply with legislation could result in
reputational damage and financial penalties;
5. Inadequate
investment and integration of the Group's IT systems and
infrastructure could impact business operations, resulting in
restricted growth and poor financial performance;
6. Failure to
appropriately safeguard against cyber risks and associated attacks
could result in operational disruption and an inability to trade,
giving rise to reputational damage, customer compensation,
financial penalties and lost sales;
7. Inappropriate
Health and Safety measures resulting in injury could give rise to
reputational damage and financial penalties;
8. Business
continuity plans are not effective and major incident response is
inadequate resulting in reputational damage, operational
disruption, and an inability to trade;
9.
Crystallisation of potential tax exposures resulting from legacy
corporate transactions, employee and sales taxes arising from
periodic tax audits and investigations across various jurisdictions
in which the Group operates may impact cash flows for the
Group;
10. Failure to employ
adequate procedures and due diligence regarding product quality and
safety could result in the provision of products which pose a risk
to customer health, resulting in fines, prosecution and significant
reputational damage;
11. Failure to either
deliver or adequately communicate our commitment to sustainability
and being a good corporate citizen could result in reputational
damage and loss of competitive advantage;
12. Failure to successfully
navigate an increasingly pervasive set of externally driven
macroeconomic factors, and cost of living pressures could result in
a deterioration in financial performance; and
13. Failure to manage
Currys' access to sufficient liquidity at any given time may impact
the Group's ability to meet its financial obligations and support
business growth plans.
The directors have prepared the preliminary
Financial Information on a going concern basis. In considering the
going concern basis, the directors have considered the
above-mentioned principal risks and uncertainties, especially in
the context of a highly competitive consumer and retail environment
as well as the wider macroeconomic environment and how these
factors might influence the Group's objectives and
strategy.
In their consideration of going concern, the
directors have reviewed the Group's future cash forecasts and
profit projections, which are based on market data and past
experience. The directors are of the opinion that the Group's
forecasts and projections, which take into account reasonably
possible changes in trading performance including the impact of
increased uncertainty and inflation in the wider economic
environment, show that the Group is able to operate within its
current facilities and comply with its banking covenants for at
least 12 months from the date of approval of these condensed
financial statements. In arriving at their conclusion that the
Group has adequate financial resources, the directors considered
the level of borrowings and facilities and that the Group has a
robust policy towards liquidity and cash flow
management.
As a result, the Board believes that the Group
is well placed to manage its financing and other significant risks
satisfactorily and that the Group will be able to operate within
the level of its facilities for at least 12 months from the date of
approval of these condensed financial statements. For this reason,
the Board considers it appropriate for the Group to adopt the going
concern basis in preparing the financial information.
The directors confirm that to the
best of their knowledge:
• the interim
financial information has been prepared in accordance with IAS 34
as adopted by the UK;
• the financial
highlights, performance review and interim financial information
include a fair review of the information required by DTR 4.2.7R
(indication of important events during the first 26 weeks and
description of principal risks and uncertainties for the remaining
26 weeks of the year); and
• the financial
highlights and performance review includes a fair review of the
information required by DTR 4.2.8R (disclosure of related party
transactions and changes therein).
At the date of this statement, the
directors are:
Alex Baldock
Bruce Marsh
Ian Dyson
Octavia Morley
Eileen Burbidge
Magdalena Gerger
Steve Johnson
Gerry Murphy
Adam Walker
By order of the
Board
Alex
Baldock
Group Chief Executive
11 December 2024
|
Bruce
Marsh
Group Chief Financial Officer
11 December 2024
|
To Currys plc
Conclusion
We have been engaged by Currys plc to review
the condensed set of financial statements in the half-yearly
financial report for the 26 weeks ended 26 October 2024 which
comprises the consolidated income statement, the consolidated
balance sheet, the consolidated statement of changes in equity, the
consolidated cash flow statement and the related explanatory
notes.
Based on our review, nothing has come to our
attention that causes us to believe that the condensed set of
financial statements in the half-yearly financial report for the 26
weeks ended 26 October 2024 is not prepared, in all material
respects, in accordance with IAS 34 Interim Financial Reporting as adopted
for use in the UK and the Disclosure Guidance and Transparency
Rules ("the DTR") of the UK's Financial Conduct Authority ("the UK
FCA").
Basis for conclusion
We conducted our review in accordance with
International Standard on Review Engagements (UK) 2410 Review of Interim Financial Information
Performed by the Independent Auditor of the Entity ("ISRE
(UK) 2410") issued for use in the UK. A review of interim
financial information consists of making enquiries, primarily of
persons responsible for financial and accounting matters, and
applying analytical and other review procedures. We read the
other information contained in the half-yearly financial report and
consider whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of
financial statements.
A review is substantially less in scope than
an audit conducted in accordance with International Standards on
Auditing (UK) and consequently does not enable us to obtain
assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not
express an audit opinion.
Conclusions relating to going
concern
Based on our review procedures, which are less
extensive than those performed in an audit as described in the
Basis of conclusion section of this report, nothing has come to our
attention that causes us to believe that the directors have
inappropriately adopted the going concern basis of accounting, or
that the directors have identified material uncertainties relating
to going concern that have not been appropriately
disclosed.
This conclusion is based on the review procedures
performed in accordance with ISRE (UK) 2410. However, future events
or conditions may cause the group to cease to continue as a going
concern, and the above conclusions are not a guarantee that the
group will continue in operation.
Directors'
responsibilities
The half-yearly financial report is the
responsibility of, and has been approved by, the directors.
The directors are responsible for preparing the half-yearly
financial report in accordance with the DTR of the UK
FCA.
As disclosed in note 1, the annual financial
statements of the group are prepared in accordance with UK-adopted
international accounting standards.
The directors are responsible for preparing
the condensed set of financial statements included in the
half-yearly financial report in accordance with IAS 34 as adopted
for use in the UK.
In preparing the condensed set of
financial statements, the directors are responsible for assessing
the group's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to
liquidate the group or to cease operations, or have no realistic
alternative but to do so.
Our
responsibility
Our responsibility is to express to the
company a conclusion on the condensed set of financial statements
in the half-yearly financial report based on our review. Our
conclusion, including our conclusions relating to going concern,
are based on procedures that are less extensive than audit
procedures, as described in the Basis for conclusion section of
this report.
The purpose of our review work and
to whom we owe our responsibilities
This report is made solely to the company in
accordance with the terms of our engagement to assist the company
in meeting the requirements of the DTR of the UK FCA. Our
review has been undertaken so that we might state to the company
those matters we are required to state to it in this report and for
no other purpose. To the fullest extent permitted by law, we
do not accept or assume responsibility to anyone other than the
company for our review work, for this report, or for the
conclusions we have reached.
Mark
Flanagan
for and on
behalf of KPMG LLP
Chartered
Accountants
15 Canada Square
London, E14 5GL
11 December 2024
Alternative performance measures
('APMs')
In the reporting of financial
information, the Group uses certain measures that are not required
under IFRS. These are presented in accordance with the Guidelines
on APMs issued by the European Securities and Markets Authority
('ESMA'). These measures are consistent with those used internally
by the Group's Chief Operating Decision Maker ('CODM') in order to
evaluate trends, monitor performance and forecast
results.
These APMs may not be directly
comparable with other similarly titled measures of 'adjusted' or
'underlying' revenue or profit measures used by other companies,
including those within our industry, and are not intended to be a
substitute for, or superior to, IFRS measures.
Management consider these
additional measures to provide additional information on the
performance of the business and trends to shareholders. The below,
and supplementary notes to the APMs, provides further information
on the definitions, purpose and reconciliations to IFRS measures of
those APMs that are used internally in order to provide parity and
transparency between the users of this financial information and
the CODM in assessing the core results of the business in
conjunction with IFRS measures.
Adjusted results
Included within our APMs the Group
reports a number of adjusted profit and earnings measures, all of
which are described throughout this section. The Group subsequently
refers to adjusted results as those which reflect the in-period
trading performance of the ongoing omnichannel retail operations
(referred to below as underlying operations and trade) and excludes
from IFRS measures certain items that are significant in size or
volatility or by nature are non-trading or highly
infrequent.
Adjusting items
When determining whether an item is
to be classified as adjusting, and the departure from IFRS measures
is more useful for the users of the financial statements than the
additional disclosure requirements for material items under IAS 1,
the project or item must:
- be
one-off in nature and have a significant impact on amounts
presented in either the statutory income statement or statutory
cash flow statement in any set of annual Group financial
statements; or
- recur
for a finite number of years and not reflect the underlying trading
performance of the business.
Management will classify items as
adjusting where these criteria are met and it is considered more
useful for the users of the financial statements to depart from
IFRS measures.
Items excluded from adjusted
results can evolve from one financial year to the next depending on
the nature of exceptional items or one-off type
activities.
Below highlights the grouping in
which management allocate adjusting items and provides further
detail on how management consider such items to meet the criteria
set out above. Further information on the adjusting items
recognised in the current and comparative periods can be found in
note A4.
Acquisition and disposal related items
Includes costs incurred in relation
to the acquisition, and income for the disposal of business
operations, as the related costs and income reflect significant
changes to the Group's underlying business operations and trading
performance. Adjusted results do not exclude the related revenues
or costs that have been earned in relation to previous
acquisitions, with the exception of the amortisation of
intangibles, such as brands, that would not have been recognised
prior to their acquisition. Where practically possible amounts are
restated in comparative periods to reflect where a business
operation has subsequently been disposed.
Alternative performance measures
('APMs') (continued)
Strategic change programmes
Primarily relate to material
one-off costs incurred for the execution and delivery of a change
in strategic direction, such as; severance and other direct
employee costs incurred following the announcement of detailed
formal restructuring plans as they are considered one-off; property
rationalisation programmes where a business decision is made to
rebase the store estate as this is considered one-off in nature and
to cause a significant change in the underlying business
operations; and implementation costs for strategic change delivery
projects that are considered one-off in nature. Such costs incurred
do not reflect the Group's underlying trading performance. Results
are therefore adjusted to exclude such items in order to aid
comparability between periods.
Regulatory costs
The Group includes material costs
related to data incidents and regulatory challenge within adjusting
items so far as on the basis of internal or external legal advice,
it has been determined that it is more than possible that a
material outflow will be required to settle the obligation (legal
or constructive) and subsequently recognised a provision in
accordance with IAS 37.
Impairment losses and onerous contracts
In order to aid comparability,
costs incurred for material non-cash impairments (or reversals of
previously recognised impairments) and onerous contracts are
included within adjusting items where they have a significant
impact on amounts presented in either the statutory income
statement or statutory cash flow statement in any set of annual
Group financial statements. When considering the threshold,
management will consider whether the gross impairment charge and
gross reversal of previously recognised impairment in any one
reportable operating segment is above the material threshold for
that financial year.
While the recognition of such is
considered to be one-off in nature, the unavoidable costs for those
contracts considered onerous is continuously reviewed and therefore
based on readily available information at the reporting date as
well as managements historical experience of similar transactions.
As a result, future cash outflows and total charges to the income
statement may fluctuate in future periods. If these changes are
material they will be recognised in adjusting items.
Other items
Other items include those items
that are one-off in nature that are material enough to distort the
underlying results of the business but do not fall into the
categories disclosed above. Such items include the settlement of
legal cases and other contractual disputes where the corresponding
income, or costs, would be considered to distort users
understanding of trading performance during the period.
Net finance income / (costs)
Included within adjusting finance
income / (costs) are net pension interest costs on the defined
benefit pension scheme within the UK and other exceptional items
considered so one-off or material that they distort underlying
finance costs of the Group (including legacy tax cases).
The net interest charge on defined
benefit pension schemes represents the non-cash remeasurement
calculated by applying the corporate bond yield rates applicable on
the last day of the previous financial year to the net defined
benefit obligation. As a non-cash remeasurement cost which is
unrepresentative of the actual investment gains or losses made or
the liabilities paid and payable, and given the defined benefit
section of the scheme having closed to future accrual on 30 April
2010, the accounting effect of this is excluded from adjusted
results.
Tax
Included within taxation is the tax impact on
those items defined above as adjusting. The exclusion from adjusted
results ensures that users, and management, can assess the overall
performance of the Groups underlying operations.
Alternative performance measures
('APMs') (continued)
Tax (continued)
Where the Group is cooperating with tax
authorities in relation to legacy tax cases and is applying tax
treatments to changes in underlying business operations as a result
of acquisition, divestiture or closure of operations, the
respective costs will also be included within adjusting items.
Management considers it appropriate to divert from IFRS measures in
such circumstance as the one-off charges related to prior periods
could distort users understanding of the Group's ongoing
operational performance.
The Group also includes the movement of
un-recognised deferred tax assets relating to unused tax losses and
other deductible temporary differences within adjusting items.
Management considers that the exclusion from adjusted results aids
users in the determination of current period performance as the
recognition and derecognition of deferred tax is impacted by
management's forecast of future performance and the ability to
utilise unused tax losses and other deductible temporary
differences.
Definitions, purpose and reconciliations
In line with the Guidelines on
Alternative Performance Measures issued by ESMA, we have provided
additional information on the APMs used by the Group below,
including full reconciliations back to the closest equivalent
statutory measure.
EBIT / EBITDA
In the key highlights and
performance review we reference financial metrics such as EBIT and
EBITDA. We would like to draw to the user's attention that these
are shown to aid comparison of our adjusted measures to the closest
IFRS measure. We acknowledge that the terminology of EBIT and
EBITDA are not IFRS defined labels but are compiled directly from
the IFRS measures of profit without making any adjustments for
adjusting items explained above. These measures are: profit /
(loss) for the year before deducting interest and tax, termed as
EBIT; and profit / (loss) for the year before deducting interest,
tax, depreciation, and amortisation, termed as EBITDA. These
metrics are further explained and reconciled within notes A2 and A3
below.
Currency neutral
Some comparative performance
measures are translated at constant exchange rates, called
'currency neutral' measures. This restates the prior period results
at a common exchange rate to the current year in order to provide
appropriate year-on-year movement measures without the impact of
foreign exchange movements.
Like-for-like (LFL) % change
Like-for-like revenue is calculated
based on adjusted store and online revenue (including Order &
Collect, Online In-Store and ShopLive) using constant exchange
rates consistent with the currency neutral % change measure
detailed above. New stores are included where they have been open
for a full financial year both at the beginning and end of the
financial period. Revenue from franchise stores is excluded and
closed stores are excluded for any period of closure during either
period. Customer support agreement, insurance and wholesale
revenues along with revenue from other non-retail businesses are
excluded from like-for-like calculations. We consider that LFL
revenue represents a useful measure of the trading performance of
our underlying and ongoing store and online portfolio.
A1 Reconciliation from (loss) /
profit before interest and tax to adjusted EBIT and adjusted PBT
(continuing operations)
Adjusted EBIT and adjusted PBT are
measures of profitability that are adjusted from IFRS measures to
remove adjusting items, the nature of which are disclosed above. A
description of costs included within adjusting items during the
period and comparative periods is further disclosed in note
A4.
As discussed above, the Group uses
adjusted profit measures in order to provide a useful measure of
the ongoing performance of the Group.
The below reconciles (loss) / profit
before tax and (loss) / profit before interest and tax, which are
considered to be the closest equivalent IFRS measures to adjusted
EBIT and adjusted PBT.
|
|
26 weeks ended 26 October
2024
|
|
Total
(loss) /
profit
£m
|
Acquisition / disposal
related items
£m
|
Strategic change
programmes
£m
|
Impairment losses and
onerous contracts
£m
|
Regulatory
income
£m
|
Other
£m
|
Interest
£m
|
Adjusted
profit /
(loss)
£m
|
|
UK & Ireland
|
17
|
6
|
1
|
-
|
(2)
|
1
|
-
|
23
|
|
Nordics
|
12
|
6
|
-
|
-
|
-
|
-
|
-
|
18
|
|
EBIT
|
29
|
12
|
1
|
-
|
(2)
|
1
|
-
|
41
|
|
Finance
income
|
4
|
-
|
-
|
-
|
-
|
-
|
-
|
4
|
|
Finance
costs
|
(43)
|
-
|
-
|
-
|
-
|
-
|
7
|
(36)
|
|
Profit before
tax
|
(10)
|
12
|
1
|
-
|
(2)
|
1
|
7
|
9
|
|
|
|
|
26 weeks
ended 28 October 2023 (Restated)*
|
|
Total
(loss) /
profit
£m
|
Acquisition / disposal related items
£m
|
Strategic change programmes
£m
|
Impairment losses and onerous contracts
£m
|
Regulatory income
£m
|
Other
£m
|
Interest
£m
|
Adjusted
profit / (loss)
£m
|
UK & Ireland
|
(1)
|
6
|
9
|
-
|
(1)
|
2
|
-
|
15
|
Nordics
|
7
|
6
|
(1)
|
-
|
-
|
-
|
-
|
12
|
EBIT
|
6
|
12
|
8
|
-
|
(1)
|
2
|
-
|
27
|
Finance income
|
2
|
-
|
-
|
-
|
-
|
-
|
-
|
2
|
Finance costs
|
(52)
|
-
|
-
|
-
|
-
|
-
|
7
|
(45)
|
Loss before tax
|
(44)
|
12
|
8
|
-
|
(1)
|
2
|
7
|
(16)
|
* The prior period has been
restated to exclude discontinued operations
A1 Reconciliation from (loss) /
profit before interest and tax to adjusted EBIT and adjusted PBT
(continuing operations) (continued)
52 weeks
ended 27 April 2024
|
|
Total
(loss) /
profit
£m
|
Acquisition / disposal related items
£m
|
Strategic change programmes
£m
|
Impairment losses and onerous contracts
£m
|
Regulatory income
£m
|
Other
£m
|
Interest
£m
|
Adjusted
profit
£m
|
UK & Ireland
|
88
|
11
|
11
|
17
|
13
|
2
|
-
|
142
|
Nordics
|
29
|
12
|
5
|
15
|
-
|
-
|
-
|
61
|
EBIT
|
117
|
23
|
16
|
32
|
13
|
2
|
-
|
203
|
Finance income
|
4
|
-
|
-
|
-
|
-
|
-
|
-
|
4
|
Finance costs
|
(93)
|
-
|
-
|
-
|
-
|
-
|
4
|
(89)
|
Profit before tax
|
28
|
23
|
16
|
32
|
13
|
2
|
4
|
118
|
A2 Reconciliation from statutory
profit / (loss) before interest and tax to EBITDA (continuing
operations)
EBITDA represents earnings before
interest, tax, depreciation and amortisation. It provides a useful
measure of profitability for users as it is a commonly used metric
to compare profitability between businesses that have differing
capital asset structures.
The below reconciles profit before
interest and tax, which is considered to be the closest equivalent
IFRS measures, to EBITDA.
|
|
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
Profit / (loss) before interest
and tax
|
|
|
29
|
6
|
117
|
Depreciation
|
|
|
107
|
109
|
219
|
Amortisation
|
|
|
35
|
43
|
80
|
EBITDA
|
|
|
171
|
158
|
416
|
* The prior period has been
restated to exclude discontinued operations
A3 Reconciliation from adjusted EBIT
to adjusted EBITDA and adjusted EBITDAR (continuing
operations)
Adjusted EBITDA represents earnings
before interest, tax, depreciation and amortisation. This measure
also excludes adjusting items, the nature of which are disclosed
above and with further detail in note A4. It provides a useful
measure of profitability for users by adjusting for the items noted
in A1 as well as depreciation and amortisation expense noted in
A2.
The depreciation adjusted within
adjusted EBITDA includes right-of-use asset depreciation on leased
assets in accordance with IFRS 16. Some leasing costs, including
those on short-term or low value leases, or variable lease payments
not included in the measurement of the lease liability, are also
included within EBITDA. A similar measure, EBITDAR, provides a
measure of profitability based on the above EBITDA definition as
well as deducting for leasing costs in EBITDA.
A3 Reconciliation from adjusted EBIT
to adjusted EBITDA and adjusted EBITDAR (continuing operations)
(continued)
The below reconciles adjusted EBIT
to adjusted EBITDA and adjusted EBITDAR. The closest equivalent
IFRS measures are considered to be profit / (loss) before interest
and tax, the reconciliation of such from adjusted EBIT can be found
in note A1.
|
|
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
Adjusted EBIT
|
|
|
41
|
27
|
203
|
Depreciation
|
|
|
107
|
109
|
219
|
Amortisation
|
|
|
23
|
31
|
57
|
Adjusted EBITDA
|
|
|
171
|
167
|
479
|
Leasing costs in EBITDA
|
|
|
2
|
5
|
4
|
Adjusted EBITDAR
|
|
|
173
|
172
|
483
|
* The prior period has been
restated to exclude discontinued operations
A4 Further information on the
adjusting items between IFRS measures to adjusted profit measures
noted above (continuing
operations)
|
Note
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
Included in (loss) / profit before
interest and tax:
|
|
|
|
|
Acquisition /
disposal related items
|
(i)
|
12
|
12
|
23
|
Strategic change
programmes
|
(ii)
|
1
|
8
|
16
|
Impairment losses and onerous
contracts
|
(iii)
|
-
|
-
|
32
|
Regulatory income
|
(iv)
|
(2)
|
(1)
|
13
|
Other
|
(v)
|
1
|
2
|
2
|
|
|
12
|
21
|
86
|
|
|
|
|
|
Included in net finance
costs:
|
|
|
|
|
Net non-cash finance
costs on defined benefit pension schemes
|
(vi)
|
4
|
5
|
11
|
Other
interest
|
(vii)
|
3
|
2
|
(7)
|
Total impact on (loss) / profit
before tax
|
|
19
|
28
|
90
|
|
|
|
|
|
Tax on other adjusting
items
|
(viii)
|
(4)
|
(3)
|
(30)
|
Total impact on (loss) /profit
after tax
|
|
15
|
25
|
60
|
* The prior period has been
restated to exclude discontinued operations
A4 Further information on the
adjusting items between IFRS measures to adjusted profit measures
noted above (continuing operations)
(continued)
(i) Acquisition / disposal related
items:
A charge of £12m (26 weeks ended
28 October 2023: £12m, 52 weeks ended 27 April 2024: £23m) relates
to amortisation of acquisition intangibles arising on the Dixons
Retail Merger.
(ii)
Strategic change programmes:
During the period £1m of costs
have been incurred as the Group continues to deliver the long-term
strategic plan. The charges incurred in the period to date relate
to property rationalisation programmes (26 weeks ended 28 October
2023: £1m credit, 52 weeks ended 27 April 2024: £nil).
In the period ended 28 October
2023 cost were also incurred in relation to the following
programmes:
·
£10m one off implementation costs of transferring
service centre operations to a third-party (52 weeks ended 27 April
2024: £12m).
·
£1m credit from a provision release related to
the restructuring of Nordics central operations and retail business
due to successful contract negotiations (52 weeks ended 27 April
2024: £4m cost).
(iii) Impairment losses and
onerous contracts:
No impairment charges have been
recognised during the 26 weeks ended 26 October 2024 (26 weeks
ended 28 October 2023: £nil).
During the 52 weeks ended 27 April
2024 a non-cash impairment charge of £15m was recognised over
assets held in the Nordics component of the group following the
strategic decision to restructure elements of the segment. This
included £16m of impairments of inefficient software assets and was
partially offset by a £1m net credit related to property
closures.
Furthermore, in the 52 weeks ended
27 April 2024 fixed asset impairment charges of £10m were
recognised over intangible software assets held in the UK &
Ireland segment that became obsolete due to system replacements
that took place during the year. In addition, the Group undertook a
strategic review of the IT licensing portfolio which resulted in
£1m of intangible impairments and a provision for onerous contracts
of £6m in relation to unavoidable future costs of licensing
agreements.
(iv) Regulatory income:
In the 52 weeks ended 27 April
2024, £13m of costs were provided for in relation to regulatory
matters. In the current period, £2m of these costs have been
reversed following updated provision estimates.
In the 26 weeks ended 28 October
2023, a £1m credit was recognised in relation to the release of a
provision related to a provision put in place for regulatory
matters in the period ended 29 April 2023.
(v) Other:
During the period ended 26 October
2024, costs of £1m have been recognised for professional fees in
relation to open tax cases (26 weeks ended 28 October 2023: £nil,
52 weeks ended 27 April 2024: £2m).
During the 26 weeks ended 28
October 2023, £2m of foreign exchange losses were recognised in
relation to the translation of a historic non-operating
intercompany balance which was capitalised in the period (52 weeks
ended 27 April 2024: £2m). This was is offset in the 52 weeks ended
27 April 2024 by £2m of income from intra-group balance
adjustments, which was offset in total statutory profit by a
corresponding cost in discontinued operations (26 weeks ended 28
October 2023: £nil).
A4 Further information on the
adjusting items between IFRS measures to adjusted profit measures
noted above (continuing operations)
(continued)
(vi) Net non-cash financing costs
on defined benefit pension schemes:
The net interest charge on defined
benefit pension schemes represents the non-cash remeasurement
calculated by applying the corporate bond yield rates applicable on
the last day of the previous financial year to the net defined
benefit obligation.
(vii) Other
interest:
Included in the charge to 26
October 2024 is £3m of arrangement fees relating to the previous
Group Revolving Credit Facilities. This represents the residual
prepayment balance that has been released to profit and loss upon
the refinancing to the new Group facility that took place in the
period.
The Group continues to cooperate
with HMRC in relation to open tax cases arising from pre-merger
legacy transactions in the Carphone Warehouse Group as detailed in
the 2023/24 Annual Report. The Group has risk assessed that certain
cases have a probable chance of resulting in cash outflows to HMRC
that are measured at £51m as at 26 October 2024 (comprising the
amount of tax payable and interest up to 26 October 2024) (52 weeks
ended 27 April 2024: £50m). During the period, interest of £1m
accrued in relation to these cases which is based upon HMRC's
prevailing interest rates (26 weeks ended 28 October 2023: £2m, 52
weeks ended 27 April 2024: £(7)m).
(viii) Tax on other adjusting
items:
The effective tax rate on
adjusting items is 21%. Included within tax on other adjusting
items is a £1m charge relating to the movement in relation to
un-recognised deferred tax assets in the UK, which were reassessed
during 2022/23 given the ongoing elevated macroeconomic uncertainty
and a £5m credit reflecting the tax effect on adjusting items
explained above.
A5 Reconciliation from statutory
(loss) / earnings per share to adjusted (loss) / earnings per share
(continuing operations)
Earnings per share ('EPS') measures
are adjusted in order to show an adjusted EPS figure which reflects
the adjusted earnings per share of the Group. We consider the
adjusted EPS provides a useful measure of the ongoing earnings of
the underlying Group.
The below table shows a
reconciliation of statutory basic EPS to adjusted basic EPS as this
is considered to be the closest IFRS equivalent.
A5 Reconciliation from statutory
(loss) / earnings per share to adjusted (loss) / earnings per share
(continuing operations) (continued)
|
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
Adjusted profit / (loss) after tax (continuing
operations)
|
|
7
|
(12)
|
87
|
Total (loss) / profit after tax (continuing
operation)
|
|
(8)
|
(37)
|
27
|
|
|
|
|
|
|
|
Million
|
Million
|
Million
|
Average shares in issue
|
|
1,133
|
1,133
|
1,133
|
Less average holding by Group
EBT
|
|
(44)
|
(25)
|
(27)
|
Weighted average number of shares
|
|
1,089
|
1,108
|
1,106
|
|
|
|
|
|
|
|
Pence
|
Pence
|
Pence
|
Basic (loss) / earnings per share
|
|
(0.7)
|
(3.3)
|
2.4
|
Adjustments (net of
taxation)
|
|
1.3
|
2.2
|
5.5
|
Adjusted basic earnings / (loss) per share
|
|
0.6
|
(1.1)
|
7.9
|
* The prior period profit has been
restated to exclude discontinued operations
Basic (loss) / earnings per share
is based on the (loss) / profit for the period attributable to
equity shareholders. Adjusted (loss) / earnings per share is
presented in order to show the underlying performance of the Group.
Adjustments used to determine adjusted (loss) / profit are
described further in note A4.
A6 Reconciliation of cash generated
from operations to free cash flow (continuing
operations)
The below provides a reconciliation
of cash generated from operations, which is considered the closest
equivalent IFRS measure, to operating cash flow and free cash
flow.
Reconciliation of cash inflow from operations to free cash
flow
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
Cash generated from continuing operations
|
206
|
166
|
419
|
Capital repayment of leases cost
and interest
|
(124)
|
(125)
|
(255)
|
Less adjusting items to cash
flow
|
10
|
21
|
48
|
Less movements in working capital
presented within the performance review (note A8)
|
(31)
|
(9)
|
34
|
Other
|
-
|
2
|
-
|
Operating cash flow
|
61
|
55
|
246
|
Capital expenditure
|
(22)
|
(21)
|
(48)
|
Add back adjusting items to cash
flow
|
(10)
|
(21)
|
(48)
|
Taxation
|
(2)
|
(4)
|
(7)
|
Cash interest paid
|
(8)
|
(14)
|
(27)
|
Sustainable free cash flow
|
19
|
(5)
|
116
|
Add back movements in working
capital presented within the performance review (note
A8)
|
31
|
9
|
(34)
|
Free cash flow
|
50
|
4
|
82
|
* The prior period has been
restated to exclude discontinued operations
A6 Reconciliation of cash generated
from operations to free cash flow (continuing operations)
(continued)
|
|
|
|
Reconciliation of adjusted EBIT to free cash
flow
|
|
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks
ended
27 April
2024
£m
|
Adjusted EBIT (note A1)
|
|
|
41
|
27
|
203
|
Depreciation and amortisation
(note A3)
|
|
|
130
|
140
|
276
|
Working capital presented within
the performance review (note A8)
|
|
|
31
|
9
|
(34)
|
Capital expenditure
|
|
|
(22)
|
(21)
|
(48)
|
Taxation
|
|
|
(2)
|
(4)
|
(7)
|
Interest
|
|
|
(8)
|
(14)
|
(27)
|
Repayment of leases**
|
|
|
(120)
|
(120)
|
(243)
|
Other non-cash items in
EBIT***
|
|
|
10
|
8
|
10
|
Free cash flow before adjusting items to cash
flow
|
|
|
60
|
25
|
130
|
Adjusting items to cash
flow
|
|
|
(10)
|
(21)
|
(48)
|
Free cash flow
|
|
|
50
|
4
|
82
|
Less working capital presented
within the performance review (note A8)
|
|
|
(31)
|
(9)
|
34
|
Sustainable free cash flow
|
|
|
19
|
(5)
|
116
|
* The prior period has been
restated to exclude discontinued operations
** Repayment of leases excludes the
impact of non-trading leases, which are presented within adjusting
items to cash flow
*** Other non-cash items in EBIT,
as disclosed within the Summary of Performance section, comprise
share-based payments, profit/loss on disposal of fixed assets,
impairments and other non-cash items.
A7 Reconciliation from liabilities
arising from financing activities to total indebtedness and net
cash/ (debt)
Total indebtedness is a measure
which represents period end net cash/ (debt), pension deficit and
lease liabilities, less any restricted cash. The purpose of this is
to evaluate the liquidity of the Group with the inclusion of all
interest-bearing liabilities.
Net cash/ (debt) comprises cash and
cash equivalents and short-term deposits, less loans and other
borrowings. We consider that this provides a useful alternative
measure of the indebtedness of the Group and is used within our
banking covenants as part of the leverage ratio.
The below provides a reconciliation
of total liabilities from financing activities, which is considered
the closest equivalent IFRS measure, to total indebtedness and net
cash/ (debt).
A7 Reconciliation from liabilities
arising from financing activities to total indebtedness and net
cash/ (debt) (continued)
|
|
|
|
26 October 2024
£m
|
28 October 2023
£m
|
27 April
2024
£m
|
Loans and other
borrowings
|
|
|
|
-
|
(218)
|
-
|
Lease liabilities*
|
|
|
|
(934)
|
(1,141)
|
(1,003)
|
Total liabilities from financing activities
(note
6)
|
|
|
|
(934)
|
(1,359)
|
(1,003)
|
Cash and cash equivalents less
restricted cash
|
|
|
|
80
|
67
|
89
|
Overdrafts
|
|
|
|
(1)
|
(5)
|
(29)
|
Lease receivables*
|
|
|
|
3
|
5
|
4
|
Pension liability
|
|
|
|
(143)
|
(190)
|
(171)
|
Total indebtedness
|
|
|
|
(995)
|
(1,482)
|
(1,110)
|
Restricted cash
|
|
|
|
28
|
27
|
36
|
Add back pension
liability
|
|
|
|
143
|
190
|
171
|
Add back lease
liabilities*
|
|
|
|
934
|
1,141
|
1,003
|
Less lease receivables*
|
|
|
|
(3)
|
(5)
|
(4)
|
Net cash/ (debt)
|
|
|
|
107
|
(129)
|
96
|
* Net
lease liabilities within the performance review relates to lease
liabilities less lease receivables.
Within the performance review
management also refer to average net cash/ (debt). Average net
cash/ (debt) comprises the same items included in net cash/ (debt)
as defined above, however calculated as the average between April -
October for the interim reporting period and April - April for the
full year to align to the Group's Remuneration Committee
calculation and as reported internally.
A8 Reconciliation of movements in
statutory working capital to working capital presented within the
performance review
Within the performance review a
reconciliation of the adjusted EBIT to free cash flow is provided.
Within this, the working capital balance of £31m (26 weeks ended 28
October 2023 £9m, year ended 27 April 2024 £(34)m) differs to the
statutory working capital balance as cash flows on adjusting items
are separately disclosed.
Working capital presented within the
performance review is a measure of working capital that is adjusted
from total IFRS measures to remove the working capital on adjusting
items. A description of costs included within adjusting items
during the period and comparative periods is further disclosed in
note A4.
As discussed above, the Group uses
adjusted profit measures in order to provide a useful measure of
the ongoing performance of the Group. A reconciliation of the
disclosed working capital balance is as follows:
|
|
|
26 weeks ended
26 October
2024
£m
|
(Restated)*
26 weeks ended
28 October
2023
£m
|
52 weeks ended
27 April
2024
£m
|
Movements in working capital (note 6)
|
|
|
25
|
-
|
(33)
|
Adjusting items
provisions
|
|
|
6
|
9
|
(1)
|
Working capital presented within the performance
review
|
|
|
31
|
9
|
(34)
|
* The prior period has been
restated to exclude discontinued operations
A9 Restatement of comparative
balance sheet
Within the Performance Review a
summary Group balance sheet it presented which includes a
comparative column for 28 October 2023 that excludes balances at
this date that were held by Dixons South East Europe A.E.V.E.
Whilst under IFRS requirements the prior period balance sheet is
not restated for discontinued operations, this additional
comparator has been included to aid comparability between
periods.
Other definitions
The following definitions may apply
throughout this interim statement and the Annual Report and
Accounts 2023/24 previously published:
Acquisition intangibles
|
Acquired intangible assets such as
customer bases, brands and other intangible assets acquired through
a business combination capitalised separately from
goodwill.
|
B2B
|
Business to business.
|
Board
|
The Board of Directors of the
Company.
|
Carphone Warehouse
Group
|
The Carphone Warehouse Group prior
to the Merger on 6 August 2014.
|
CODM
|
Chief Operating Decision
Maker.
|
Company or the Company
|
Currys plc (incorporated in
England & Wales under the Act, with registered number
07105905), whose registered office is at 1 Portal Way, London W3
6RS.
|
Currys plc or Group
|
The Company, its subsidiaries and
other investments.
|
Dixons Retail Merger or
Merger
|
The all share merger of Dixons
Retail plc and Carphone Warehouse plc which occurred on 6 August
2014.
|
EBT
|
Employee benefit trust.
|
HMRC
|
His Majesty's Revenue and
Customs.
|
IFRS
|
International Financial Reporting
Standards as adopted by the UK.
|
Market position
|
Ranking against competitors in the
electrical and mobile retail market, measured by market share.
Market share is measured for each of the Group's markets by
comparing data for revenue or volume of units sold relative to
similar metrics for competitors in the same market.
|
MVNO
|
Mobile Virtual Network
Operator.
|
Net zero
|
Net zero emissions includes our
Scope 1, 2 and 3 emissions. In 2020, we collaborated with The
British Retail Consortium and other major retailers on the
development of a Climate Action Roadmap to decarbonise the retail
industry and its supply chains. The plan aims to bring the retail
industry and its supply chains to Net Zero by 2040. Our commitment
to net zero meets a number of the criteria of the SBTi Corporate
Net-Zero Standard but is not fully aligned or validated against
this standard. We will develop and publish a robust net zero
emissions roadmap for the Group which will provide detail on carbon
abatement for key emissions sources and neutralisation plans of any
source of residual emissions that remain unfeasible to
remove.
|
NPS
|
Net promoter score, a rating used
by the Group to measure customers' likelihood to recommend its
operations.
|
Online
|
Online sales and Online market
share relate to all sales where the journey is completed via the
website or app. This includes online home delivered, order &
collect, Online In-Store and ShopLive UK.
|
Online in-store
|
Sales that are generated through
in-store tablets for products that are not stocked in the
store.
|
Order & collect
|
Sales where the sale is made via
the website or app and collected in store.
|
Peak
|
Peak refers to the 10-week trading
period ending on 6 January 2024 as to be announced in the Group's
Christmas Trading statement in January 2024.
|
ShopLive UK
|
The Group's own video shopping service where store colleagues can assist,
advise and demonstrate the use of products to customers online
face-to-face.
|
Store
|
Store sales, Store market share,
and Store share of business relate to all sales where the journey
is completed in store. This excludes online home delivered, order
& collect, Online in-store and ShopLive UK.
|