Registered number:
FOR THE PERIOD ENDED 28 APRIL 2024
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FOUR (HOLDINGS) LIMITED
COMPANY INFORMATION
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FOUR (HOLDINGS) LIMITED
CONTENTS
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FOUR (HOLDINGS) LIMITED
GROUP STRATEGIC REPORT
FOR THE PERIOD ENDED 28 APRIL 2024
The directors present the strategic report for the period ended 28 April 2024.
The group operates in the luxury fashion and retail sector, with the majority of its operations focused in the UK. The sector has been impacted by reduced consumer spending due to inflationary pressures, which have increased the cost of living and adversely affected demand for luxury products. Despite these challenges, the group has experienced growth in specific brands and international operations, particularly with Agent Provocateur. During the financial year, the group fully acquired PG2019 Limited, the company which owns the brand Pretty Green.
Turnover for the period is £121.8m vs £153.4m for the previous period, reflecting a reduction in wholesale revenue in the UK and reduction in scale of some ancillary business units, offset by growth in specific brands and the international operations of the Agent Provocateur and Pretty Green business. Profit before tax for the period was £10.4m vs £22.6m in prior period, reflecting overall reduced trading offset with specific impact of sale & rationalisation transactions in the year.
The following are seen as key risks and uncertainties to the group :
∙Changes in the global economic and luxury retail environment.
∙Impact of changes in cross border trading, in particular impact of changes between the EU & UK and US & UK. This is partially mitigated by the use of logistics partners & facilities in those territories.
∙Foreign exchange movements, due to e-commerce sales and stock supplies being in foreign currencies. It is thought that the risk is mitigated to a large extent as a result of natural hedging arising from currency income from non-UK operations being set off against overseas stock purchases transacted in non-GBP currencies.
∙One of the main element of the group’s business is holding the rights to market and develop brands, and consequently one of the most significant risks would be the non renewal of certain rights.
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FOUR (HOLDINGS) LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 28 APRIL 2024
Controls are in place to monitor turnover & KPls on an ongoing basis. These KPls are standard measures reflecting the overall financial and non-financial perfornance of the business and accordingly management considers these appropriate to monitor and report at board level. Development and performance The group aims to boost its sales through 2024/2025 by launching exceptional collections, while simultaneously maintaining strict cost control measures. Position of the group at the period end The directors believe that the group is well positioned to continue to deal with the ongoing uncertain climate and take advantage of opportunities as they arise.
The Companies Act 2006 s172 Director’s Duty is to “promote the success of the group for the benefit of its members as a whole”, whilst having regard to other stakeholder interests. The Duty emphasises that Boards must consider the wider impact of their decisions, rather than just the financial and strategic elements. The Board should create a culture whereby the long- term consequences of its actions and the long-term success of the group are given due consideration.
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FOUR (HOLDINGS) LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 28 APRIL 2024
The Board takes care to consider the interests of all stakeholders when deciding on courses of action, but it also recognises that the result will not always be a positive one for all stakeholder groups. The Board takes into consideration the strategy, purpose, values and culture of the business when making its decisions. During the year, the Board has made decisions based on Board papers, presentations from senior executives, discussions with external bodies, and other reports. Stakeholders vary depending on the decisions under discussion, and the Board’s aim is to regularly review its stakeholders to ensure that they are all given due consideration.
The following statement, and references in the Strategic Report, show how the Board has applied s172 requirements to its decision making throughout the year. a. the likely consequences of any decision in the long-term When making key strategic decisions, the Board takes into consideration the strategy, purpose, values and culture of the group. The Board is focused on the sustainability of the group and is mindful of the impact the decisions may have on this objective. For each matter, it also considers the likely consequences of any decision in the long term, identifying stakeholders who may be affected and carefully considering their interests and any potential impact the decision making process may have. Principal Decisions / Steps Under an ongoing programme to simplify the business of the group, several non performing business units have been rationalised in the year and central overhead has been reduced accordingly. b. The interests of the Group’s employees Our relationship with our employees is paramount. The group is actively aiming to develop and promote employees internally to senior roles vs external hires where this is appropriate to provide meaningful career development within the group. Principal Decisions / Steps The group has promoted and elevated employees in to key roles where appropriate, continuing to develop internal talent. c. The need to foster the Group’s business relationships with suppliers, customers and others The group aims to develop and maintain mutually beneficial business relationships with all our customers, suppliers and government agencies and other stakeholders. Principal Decisions / Steps The group holds regular meetings with key suppliers and brands to ensure smooth running of these relationships. d. The impact of the Group’s operations on the community and the environment The board is mindful of the impact of operations on the community and wider environment. Principal Decisions / Steps The group continuously reviews opportunities to improve the efficiency and impact of the group, including implementation of measures to movement of product between locations and delivery by sea freight rather than air freight where possible. e. The desirability of the Group maintaining a reputation for high standards of business conduct At all times we endeavour to meet our Corporate Governance obligations and work to high standards of good business conduct. The group complies with all relevant legislation and engages with relevant authorities on a transparent basis where required. f. The need to act fairly as between members of the Group All members of the group hold ordinary shares which attach the same rights and benefits.
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FOUR (HOLDINGS) LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 28 APRIL 2024
This report was approved by the board and signed on its behalf.
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FOUR (HOLDINGS) LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 28 APRIL 2024
The directors present their report and the financial statements for the period ended 28 April 2024.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the period, after taxation, amounted to £9,415,884 (2023 - £20,462,245).
No dividends were declared in the year (2023 - £nil).
The directors who served during the period were:
Future developments are set out in the Strategic Report.
Information about engagement with employees is set out in the Strategic Report.
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FOUR (HOLDINGS) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 28 APRIL 2024
Information about engagement with suppliers, customers and others is set out in the Strategic Report.
The UK Government's Streamlined Energy and Carbon Reporting (SECR) policy was implemented on 1 April 2019. The table below represents the company's energy use and associated greenhouse gas (GHG) emissions from electricity and fuel in the UK for the period ended 28 April 2024.
Quantification and reporting methodology
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting. We have used the following data sources for the report : - Energy Data - energy supplier billing data - Transport data - company mileage records & estimated usage CO2e emissions have been calculated using the 2024 UK Government conversion Factors for company reporting. Intensity measurement The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £m of sales, the recommended ratio for the sector. Measures taken to improve energy efficiency - A periodic review of energy bills and usage is undertaken with a view to ensuring the energy usage in the HQ building remains at an appropriate level. - As a general policy travel has been limited in favour of remote calls where commercially viable. - Company owned vehicles have been phased out in 2022/23.
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FOUR (HOLDINGS) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 28 APRIL 2024
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FOUR (HOLDINGS) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 28 APRIL 2024
There have been no significant events affecting the Group since the year end.
The auditors, Hillier Hopkins LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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FOUR (HOLDINGS) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FOUR (HOLDINGS) LIMITED
We have audited the financial statements of Four (Holdings) Limited (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 28 April 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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FOUR (HOLDINGS) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FOUR (HOLDINGS) LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group Strategic Report and the Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
∙the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
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FOUR (HOLDINGS) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FOUR (HOLDINGS) LIMITED (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
∙the nature of the industry and sector, control environment and business performance including the remuneration incentives and pressures of key management;
∙the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management. We consider the results of our enquiries of management about their own identification and assessment of the risks of irregularities;
∙any matters we identified having obtained and reviewed the Group’s documentation of their policies and procedures relating to:
°identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
°detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;
°the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;
∙the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
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FOUR (HOLDINGS) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FOUR (HOLDINGS) LIMITED (CONTINUED)
We also obtained an understanding of the legal and regulatory frameworks that the Group operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. We focused on laws and regulations that could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and relevant tax legislation.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' 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 and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants
Statutory Auditor
Ground Floor
45 Pall Mall
SW1Y 5JG
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FOUR (HOLDINGS) LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 28 APRIL 2024
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FOUR (HOLDINGS) LIMITED
REGISTERED NUMBER: 04225618
CONSOLIDATED BALANCE SHEET
AS AT 28 APRIL 2024
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FOUR (HOLDINGS) LIMITED
REGISTERED NUMBER: 04225618
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 28 APRIL 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 23 to 45 form part of these financial statements.
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FOUR (HOLDINGS) LIMITED
REGISTERED NUMBER: 04225618
COMPANY BALANCE SHEET
AS AT 28 APRIL 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 23 to 45 form part of these financial statements.
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 APRIL 2023
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