BRBY Burberry Group Plc

1. Basis of preparation

The financial information contained within this report has been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards adopted pursuant to Regulation (EC) No. 1606/2002 as it applies in the European Union, IFRS Interpretations Committee (IFRS IC) interpretations and parts of the Companies Act 2006 applicable to companies reporting under IFRS. This financial information does not constitute the Burberry Group's (the Group) Annual Report and Accounts within the meaning of Section 435 of the Companies Act 2006.

Statutory accounts for the 52 weeks to 1 April 2023 have been filed with the Registrar of Companies, and those for 2024 will be delivered in due course. The reports of the auditors on those statutory accounts for the 52 weeks to 1 April 2023 and 52 weeks to 30 March 2024 were unqualified, did not contain an emphasis of matter paragraph and did not contain a statement under either section 400(2) or section 498(3) of the Companies Act 2006.

The consolidated financial statements are presented in £m. Financial ratios are calculated using unrounded numbers.

Going concern

In considering the appropriateness of adopting the going concern basis in preparing the financial statements, the Directors have assessed the potential cash generation of the Group. This assessment for any indicators that the going concern basis of preparation is not appropriate covers the period from the date of signing the financial statements up to 27 September 2025.

The scenarios considered by the Directors include a severe but plausible downside scenario reflecting the Group's base plan adjusted for severe but plausible impacts from the Group's principal risks. This central planning scenario is informed by a comprehensive review of the macroeconomic scenarios using third-party projections of macroeconomic data for the luxury fashion industry . The Group's central planning scenario reflects a balanced projection aligned to the Group's strategy, a balanced assumption for economic uncertainty and capital expenditure and dividends in line with the Group's capital allocation framework.

As a sensitivity, this central planning scenario has been flexed to reflect the aggregation of severe impacts arising linked to our principal risks which in total represents a 13% downgrade to revenues in the 18 month period to September 2025, in comparison to the base case, as well as the associated consequences for EBITDA and cash. Management consider this represents a severe but plausible downside scenario appropriate for assessing going concern.

The severe but plausible downside modelled the following risks occurring simultaneously:

·      A severe impact arising from a more severe and prolonged reduction in the GDP growth assumptions across the markets in which we operate, combined with a reduction to our global consumer demand arising from a change in consumer preference compared to our central planning scenario

·      An increase in geopolitical tension which reduces GDP growth assumptions compared to the central planning model

·      A significant reputational incident such as negative sentiment propagated through social media

·      The impact of a business interruption event, resulting in a two week interruption arising from the supply chain impact, and interruption to one of our channels

·      The occurrence of a one-time physical risk relating to climate change in FY 2024/25 and the materialisation of a severe but plausible ongoing market risk relating to climate change in line with a scenario reflecting a 2°C global temperature increase compared to pre-industrial levels

·      The payment of a settlement arising from a regulatory or compliance-related matter

·      A short-term impact of a 10% weakening in a key non-sterling currency for the Group before it is recovered through price adjustment

·      Repayment of Sustainability Bond without raising new finance

Further mitigating actions within management control would be available under this scenario, including working capital reduction measures and limiting capital expenditure, but these were not incorporated into the downside modelling.

The Directors have also considered the Group's current liquidity and available facilities. As at 30 March 2024, the Group Balance Sheet reflects cash net of overdrafts of £362 million. In addition, the Group has access to a £300 million revolving credit facility which matures in July 2026, which is currently undrawn. The £300 million sustainability bond matures within the going concern period on 21 September 2025 and the revolving credit facility is considered to be available to be drawn within the severe but plausible scenario in order to settle this repayment.

The Group is in compliance with the covenants for the revolving credit facility, and the borrowings raised via the sustainability bond are not subject to covenants. Details of cash, overdrafts, borrowings and facilities are set out in notes 16, 19 and 20 respectively of these financial statements. Whilst outside of the going concern assessment period, the Group have considered renewal of the revolving credit facility ahead of maturity in July 2026 and are confident that this will be available.

In all the scenarios assessed, taking into account current liquidity and available resources and before the inclusion of any mitigating actions within management control, the Group was able to maintain sufficient liquidity to continue trading through the going concern period up to 27 September 2025. On the basis of the assessment performed, the Directors consider it is appropriate to continue to adopt the going concern basis in preparing the consolidated financial statements for the 52 weeks ended 30 March 2024.

New standards, amendments and interpretations adopted in the period

A number of new amendments to standards are effective for the financial period commencing 2 April 2023 but they do not have a material impact on the financial statements of the Group. Refer to note 8 for further details on the impact of adoption of amendments to IAS 12 Income taxes.

Standards not yet adopted

Certain new accounting standards and amendments to standards have been published that are not mandatory for the 52 weeks to 30 March 2024 and have not been early adopted by the Group. These standards are not expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions, apart from IFRS 18 Presentation and Disclosure in Financial Statements. IFRS 18, which is effective for reporting periods beginning on or after 1 January 2027, replaces IAS 1 Presentation of Financial Statements and is expected to impact the presentation of the Group's primary financial statements. The amendment was issued on 9 April 2024 and the impact will be communicated in future periods following an assessment by the Group.

Key sources of estimation uncertainty

Preparation of the consolidated financial statements in conformity with IFRS requires that management make certain estimates and assumptions that affect the measurement of reported revenues, expenses, assets and liabilities and the disclosure of contingent liabilities.

If in the future such estimates and assumptions, which are based on management's best estimates at the date of the financial statements, deviate from actual circumstances, the original estimates and assumptions will be updated as appropriate in the period in which the circumstances change.

Estimates are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The key areas where the estimates and assumptions applied have a significant risk of causing a material adjustment to the carrying value of assets and liabilities within the next financial year are discussed below.

Impairment, or reversals of impairment, of property, plant and equipment and right-of-use assets

Property, plant and equipment and right-of-use assets are reviewed for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable. When a review for impairment is conducted, the recoverable amount of an asset or a cash generating unit is determined based on value-in-use calculations prepared using management's best estimates and assumptions at the time. Refer to notes 12 and 13 for further details of retail property, plant and equipment, right-of-use assets and impairment reviews carried out in the period and for sensitivities relating to this key source of estimation uncertainty.

Inventory provisioning

The Group purchases, manufactures and sells luxury goods and is subject to changing consumer demands and fashion trends. The recoverability of the cost of inventories is assessed every reporting period, by considering the expected net realisable value of inventory compared to its carrying value. Where the net realisable value is lower than the carrying value, a provision is recorded. When calculating inventory provisions, management considers the nature and condition of the inventory, as well as applying assumptions in respect of anticipated saleability of finished goods and future usage of raw materials. Refer to note 15 for further details of the carrying value of inventory and inventory provisions and for sensitivities relating to this key source of estimation uncertainty.

Uncertain tax positions

In common with many multinational companies, the Group faces tax audits in jurisdictions around the world in relation to intragroup transactions between associated entities within the Group. These tax audits are often subject to inter-government negotiations. The matters under discussion are often complex and can take many years to resolve.

Tax liabilities are recorded based on management's estimate of either the most likely amount or the expected value amount depending on which method is expected to better reflect the resolution of the uncertainty. Given the inherent uncertainty in assessing tax outcomes, the Group could, in future periods, experience adjustments to these tax liabilities that have a material positive or negative effect on the Group's results for a particular period.

Refer to note 8 for further details of management estimates surrounding the outcome of all matters under dispute or negotiation between governments in relation to current tax liabilities recognised at 30 March 2024, and for sensitivities relating to this key source of estimation uncertainty.

Key judgements in applying the Group's accounting policies

Judgements are those decisions made when applying accounting policies which have a significant impact on the amounts recognised in the Group financial statements. Key judgements that have a significant impact on the amounts recognised in the Group financial statements for the 52 weeks to 30 March 2024 and the 52 weeks to 1 April 2023 are as follows:

Where the Group is a lessee, judgement is required in determining the lease term at initial recognition, and throughout the lease term, where extension or termination options exist. In such instances, all facts and circumstances that may create an economic incentive to exercise an extension option, or not exercise a termination option, have been considered to determine the lease term. Considerations include, but are not limited to, the period assessed by management when approving initial investment, together with costs associated with any termination options or extension options. Extension periods (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). Where the lease term has been extended by assuming an extension option will be recognised, this will result in the initial right-of-use assets and lease liabilities at inception of the lease being greater than if the option was not assumed to be exercised. Likewise, assuming a break option will be exercised will reduce the initial right-of-use assets and lease liabilities.

Refer to note 18 for further details surrounding the judgements regarding the impact of breaks and options on lease liabilities.

2. Translations of the results of overseas businesses

The results of overseas subsidiaries are translated into the Group's presentation currency of sterling each month at the average exchange rate for the month, weighted according to the phasing of the Group's trading results. The average exchange rate is used, as it is considered to approximate the actual exchange rates on the date of the transactions. The assets and liabilities of such undertakings are translated at the closing rates. Differences arising on the retranslation of the opening net investment in subsidiary companies, and on the translation of their results, are recognised in other comprehensive income.

Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate.

The principal exchange rates used were as follows:

	Average rate		Closing rate
	52 weeks to 30 March 2024	52 weeks to 1 April 2023	As at 30 March  2024	As at 1 April 2023
Euro	1.16	1.16	1.17	1.14
US Dollar	1.26	1.20	1.26	1.24
Chinese Yuan Renminbi	9.01	8.27	9.13	8.51
Hong Kong Dollar	9.84	9.43	9.89	9.73
South Korean Won	1,657	1,577	1,702	1,613
Japanese Yen	182	163	191	165

3. Adjusted profit before taxation

In order to provide additional understanding of the underlying performance of the Group's ongoing business, the Group's results include a presentation of Adjusted operating profit and Adjusted profit before taxation (adjusted PBT). Adjusted PBT is defined as profit before taxation and before adjusting items. Adjusting items are those items which, in the opinion of the Directors, should be excluded in order to provide a consistent and comparable view of the performance of the Group's ongoing business. Generally, this will include those items that are largely one-off and/or material in nature as well as income or expenses relating to acquisitions or disposals of businesses or other transactions of a similar nature, including the impact of changes in fair value of expected future payments or receipts relating to these transactions. Adjusting items are identified and presented on a consistent basis each year and a reconciliation of adjusted PBT to profit before taxation is included in the financial statements. Adjusting items and their related tax impacts, as well as adjusting taxation items, are added back to/deducted from profit attributable to owners of the Company to arrive at adjusted earnings per share. Refer to note 6 for further details on adjusting items and note 9 for details on adjusted earnings per share.

 

4. Segmental analysis

The Chief Operating Decision Maker has been identified as the Board of Directors. The Board reviews the Group's internal reporting in order to assess performance and allocate resources. Management has determined the operating segments based on the reports used by the Board. The Board considers the Group's business through its two channels to market, being retail/wholesale and licensing.

Retail/wholesale revenues are generated by the sale of luxury goods through Burberry mainline stores, concessions, outlets and digital commerce as well as Burberry franchisees, prestige department stores globally and multi-brand speciality accounts. The flow of global product between retail and wholesale channels and across our regions is monitored and optimised at a corporate level and implemented via the Group's inventory hubs and principal distribution centres situated in Europe, the USA, Mainland China and Hong Kong S.A.R., China.

Licensing revenues are generated through the receipt of royalties from global licensees of beauty products, eyewear and from licences relating to the use of non-Burberry trademarks in Japan.

The Board assesses channel performance based on a measure of adjusted operating profit. This measurement basis excludes the effects of adjusting items. The measure of earnings for each operating segment that is reviewed by the Board includes an allocation of corporate and central costs. Interest income and charges are not included in the result for each operating segment that is reviewed by the Board.

	Retail/Wholesale		Licensing		Total
	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Retail	2,400	2,501	-	-	2,400	2,501
Wholesale	506	543	-	-	506	543
Licensing	-	-	63	51	63	51
Total segment revenue	2,906	3,044	63	51	2,969	3,095
Inter-segment revenue1	-	-	(1)	(1)	(1)	(1)
Revenue from external customers	2,906	3,044	62	50	2,968	3,094
Depreciation and amortisation2	(379)	(341)	-	-	(379)	(341)
Net impairment charge of property, plant and equipment	(5)	(2)	-	-	(5)	(2)
Net impairment charge of right-of-use assets3	(9)	(5)	-	-	(9)	(5)
Other non-cash items:
Share-based payments	(16)	(19)	-	-	(16)	(19)
Adjusted operating profit	359	587	59	47	418	634
Adjusting items4					-	21
Finance income					31	21
Finance expense					(66)	(42)
Profit before taxation					383	634

1.   Inter-segment transfers or transactions are entered into under the normal commercial terms and conditions that would be available to unrelated third parties.

2.   Depreciation and amortisation for the 52 weeks to 1 April 2023 was presented excluding £3 million arising as a result of the Group's restructuring programme, which was presented as an adjusting item (refer to note 6).

3.   Net impairment charge of right-of-use assets for the 52 weeks to 1 April 2023 was presented excluding a reversal of £6 million relating to charges as a result of the impact of COVID-19 and a net charge of £3 million arising as a result of the Group's restructuring programme, which were presented as adjusting items (refer to note 6).

4.   Adjusting items relate to the Retail and Wholesale segment. Refer to note 6 for details of adjusting items.

		Retail/Wholesale			Licensing			Total
	52 weeks to 30 March 2024 £m		52 weeks to 1 April 2023 £m	52 weeks to 30 March 2024 £m		52 weeks to 1 April 2023 £m	52 weeks to 30 March 2024 £m		52 weeks to 1 April 2023 £m
Additions to non-current assets	399		350	-		-	399		350
Total segment assets	2,474		2,273	6		5	2,480		2,278
Goodwill							119		109
Cash and cash equivalents							441		1,026
Taxation							330		273
Total assets per Balance Sheet							3,370		3,686

Additional revenue analysis

All revenue is derived from contracts with customers. The Group derives retail and wholesale revenue from contracts with customers from the transfer of goods and related services at a point in time. Licensing revenue is derived over the period the licence agreement gives the customer access to the Group's trademarks.

Revenue by product division	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Accessories	1,055	1,125
Women's	860	867
Men's	842	868
Children's/Other	149	184
Retail/Wholesale	2,906	3,044
Licensing	62	50
Total	2,968	3,094

 

Revenue by destination	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Asia Pacific	1,286	1,297
EMEIA1	1,017	1,004
Americas	603	743
Retail/Wholesale	2,906	3,044
Licensing	62	50
Total	2,968	3,094

1.   EMEIA comprises Europe, Middle East, India and Africa.

Entity-wide disclosures

Revenue derived from external customers in the UK totalled £295 million for the 52 weeks to 30 March 2024 (last year: £257 million).

Revenue derived from external customers in foreign countries totalled £2,673 million for the 52 weeks to 30 March 2024 (last year: £2,837 million). This amount includes £531 million of external revenues derived from customers in the USA (last year: £661 million) and £648 million of external revenues derived from customers in Mainland China (last year: £683 million).

The total of non-current assets, other than financial instruments, and deferred tax assets located in the UK is £523 million (last year: £485 million). The remaining £1,168 million of non-current assets are located in other countries (last year: £1,094 million), with £352 million located in the USA (last year: £318 million) and £200 million located in Mainland China (last year: £235 million).

 

5. Profit before taxation

	Note	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Adjusted profit before taxation is stated after charging/(crediting):
Depreciation of property, plant and equipment
Within cost of sales		2	2
Within selling and distribution costs		84	76
Within administrative expenses		17	17
Depreciation of right-of-use assets
Within cost of sales		1	-
Within selling and distribution costs		214	191
Within administrative expenses1		19	18
Amortisation of intangible assets
Within selling and distribution costs		1	1
Within administrative expenses		41	36
Loss on disposal of intangible assets		3	-
Gain on modification of right-of-use assets		(4)	(2)
Net impairment charge of property, plant and equipment	12	5	2
Net impairment charge of right-of-use assets2	13	9	5
Employee costs3		572	565
Other lease expense
Property lease variable lease expense	18	111	125
Property lease in holdover expense	18	18	20
Non-property short-term lease expense	18	12	11
Net exchange loss on revaluation of monetary assets and liabilities		20	10
Net gain on derivatives - fair value through profit and loss		(7)	(9)
Receivables net impairment charge		4	2

1.   Depreciation of right-of-use assets within administrative expenses for the 52 weeks to 1 April 2023 was presented excluding £3 million arising as a result of the Group's restructuring programme, which was presented as an adjusting item (refer to note 6).

2.   Net impairment charge of right-of-use assets for the 52 weeks to 1 April 2023 was presented excluding a reversal of £6 million relating to charges as a result of the impact of COVID-19 and a net charge of £3 million arising as a result of the Group's restructuring programme, which were presented as adjusting items (refer to note 6).

3.   Employee costs for the 52 weeks to 1 April 2023 was presented excluding a charge of £10 million arising as a result of the Group's restructuring programme, which was presented as an adjusting item (refer to note 6).

6. Adjusting items

		52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Adjusting items
Adjusting operating items
Impact of COVID-19:
Impairment reversal relating to retail cash generating units		-	(6)
Impairment reversal relating to inventory		-	(1)
COVID-19-related rent concessions		-	(13)
COVID-19-related government grant income		-	(2)
Other adjusting items:
Gain on disposal of property		-	(19)
Restructuring costs		-	16
Revaluation of deferred consideration liability		-	2
Total adjusting operating items		-	(23)
Adjusting financing items
Finance charge on adjusting items		-	2
Total adjusting financing items		-	2
Tax on adjusting items		-	6
Total adjusting items (post-tax)		-	(15)

 

	Note	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Analysis of adjusting operating items:
Included in Cost of sales (Impairment reversal relating to inventory)		-	(1)
Included in Operating expenses		-	12
Included in Other operating income		-	(34)
Total		-	(23)

No adjusting items have been recorded for the 52 weeks to 30 March 2024. Adjusting items related to prior periods were as follows:

Impact of COVID-19

Impairment of retail cash generating units

During the 52 weeks to 1 April 2023, a net impairment reversal of £6 million, and an associated tax charge of £1 million, were recorded following the reassessment of the COVID-19 related impairment provision. Any charges or reversals from the reassessment of the original impairment adjusting item, had they arisen, would have been included in this adjusting item. Refer to notes 12 and 13 for details of impairment of retail cash generating units.

Impairment of inventory

During the 52 weeks to 1 April 2023, reversals of inventory provisions of £1 million were recorded and presented as adjusting items. This was relating to inventory which had been provided for as an adjusting item at the previous year end and had either been sold, or was expected to be sold, at a higher net realisable value than had been assumed when the provision had been initially estimated. All other charges and reversals relating to inventory provisions have been recorded in adjusted operating profit. Refer to note 15 for details of inventory provisions.

COVID-19-related rent concessions

During the 52 weeks to 1 April 2023, eligible rent forgiveness amounts relating to COVID-19 were treated as negative variable lease payments, which resulted in a credit of £13 million recorded within other operating income. This income was presented as an adjusting item given that the amendment to IFRS 16 was only applicable for a limited period of time and it explicitly related to COVID-19. The amendment expired on 30 June 2022 however the Group continued to apply the same accounting treatment applying the principles of IFRS 9 for any ongoing COVID-19 related rent forgiveness. A related tax charge of £3 million was also recognised in the prior year.

COVID-19-related grant income

During the 52 weeks to 1 April 2023, the Group recorded grant income of £2 million within other operating income relating to government support to alleviate the impact of COVID-19. This income was presented as an adjusting item as it was explicitly related to COVID-19, and the arrangements were expected to last for a limited period of time. A related tax charge of £1 million was also recognised in the prior year.

Other adjusting items

Gain on disposal of property

During the 52 weeks to 1 April 2023, the Group completed the sale of an owned property in the USA for cash proceeds of £22 million resulting in a net gain on disposal of £19 million, recorded within other operating income. The net gain on disposal was recognised as an adjusting item, in accordance with the Group's accounting policy, as it was considered to be material and one-off in nature. A related tax charge of £5 million was also recognised in the prior year.

Restructuring costs

During the 52 weeks to 1 April 2023, restructuring costs of £16 million were incurred primarily as a result of the organisational efficiency programme announced in July 2020, which completed last year. The costs principally related to impairment charges on non-retail assets and redundancies and were recorded in operating expenses. They were presented as an adjusting item, in accordance with the Group's accounting policy, as the anticipated cost of the restructuring programme was considered material and discrete in nature. A related tax credit of £4 million was also recognised in the prior year.

Items relating to the deferred consideration liability

On 22 April 2016, the Group entered into an agreement to transfer the economic right of the non-controlling interest in Burberry Middle East LLC to the Group in exchange for consideration of contingent payments to be made to the minority shareholder over the period ending 30 March 2024. Contingent payments of £5 million remain outstanding at 30 March 2024, which will be paid once all required documentation is complete.

During the 52 weeks to 1 April 2023, a charge of £2 million in relation to the revaluation of this balance was recognised in operating expenses. No tax was recognised as the future payments were not considered to be deductible for tax purposes. This was presented as an adjusting item in accordance with the Group's accounting policy, as it arose from changes in the value of the liability for expected future payments relating to the purchase of a non-controlling interest in the Group.

7. Financing

	Note	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Finance income - amortised cost		9	3
Bank interest income - fair value through profit and loss		22	18
Finance income		31	21
Interest expense on lease liabilities1	18	(43)	(31)
Interest expense on overdrafts		(7)	(2)
Interest expense on borrowings		(4)	(4)
Bank charges		(1)	(1)
Other finance expense		(11)	(4)
Finance expense		(66)	(42)
Finance charge on adjusting items	6	-	(2)
Net finance expense		(35)	(23)

1.   During the 52 weeks to 1 April 2023, interest expense on lease liabilities of £31 million excluded £2 million arising as a result of the Group's restructuring programme, which was presented as an adjusting item (refer to note 6).

8. Taxation

Analysis of charge for the year recognised in the Group Income Statement:

	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Current tax
UK corporation tax
Current tax on income for the 52 weeks to 30 March 2024 at 25% (last year: 19%)	104	116
Double taxation relief	(3)	(5)
Adjustments in respect of prior years1	44	12
	145	123
Foreign tax
Current tax on income for the year	26	34
Adjustments in respect of prior years1	(35)	3
	(9)	37
Total current tax	136	160
Deferred tax
UK deferred tax
Origination and reversal of temporary differences	5	4
Adjustments in respect of prior years1	(1)	-
	4	4
Foreign deferred tax
Origination and reversal of temporary differences	(28)	(26)
Adjustments in respect of prior years1	-	4
	(28)	(22)
Total deferred tax	(24)	(18)
Total tax charge on profit	112	142

1.   Adjustments in respect of prior years relate mainly to adjustments to estimates of prior period tax liabilities and a net increase in provisions for uncertain tax positions (where in some instances the provision also includes offsetting relief in a different jurisdiction) and tax accruals.

 

Analysis of charge for the year recognised in other comprehensive income and directly in equity:

	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Current tax
Recognised in other comprehensive income:
Current tax (credit)/charge on exchange differences on loans (foreign currency translation reserve)	(1)	1
Total current tax recognised in other comprehensive income	(1)	1
Deferred tax
Recognised in equity:
Deferred tax charge/(credit) on share options (retained earnings)	2	(2)
Total deferred tax recognised directly in equity	2	(2)

 

The tax rate applicable on profit varied from the standard rate of corporation tax in the UK due to the following factors:

	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Profit before taxation	383	634
Tax at 25% (last year: 19%) on profit before taxation	97	120
Rate adjustments relating to overseas profits	-	1
Permanent differences	3	4
Current year tax losses not recognised	3	-
Prior year temporary differences and tax losses recognised	1	(3)
Adjustments in respect of prior years	8	19
Adjustments to deferred tax relating to changes in tax rates	-	1
Total taxation charge	112	142

Total taxation recognised in the Group Income Statement arises on the following items:

	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Tax on adjusted profit before taxation	112	136
Tax on adjusting items	-	6
Total taxation charge	112	142

Factors affecting future tax charges

Uncertain tax positions

The Group operates in numerous tax jurisdictions around the world and is subject to factors that may affect future tax charges including transfer pricing, tax rate changes, tax legislation changes, tax authority interpretation, expiry of statutes of limitation, tax litigation, and resolution of tax audits and disputes.

At any given time, the Group has open years outstanding in various countries and is involved in tax audits and disputes, some of which may take several years to resolve. Provisions are based on best estimates and management's judgements concerning the likely ultimate outcome of any audit or dispute. Management considers the specific circumstances of each tax position and takes external advice, where appropriate, to assess the range of potential outcomes and estimate additional tax that may be due.

At 30 March 2024 the Group recognised provisions of £91 million in respect of uncertain tax positions (increasing from £86 million in 2023), being provisions of £131 million net of expected reimbursements of £40 million (last year: £103 million net of expected reimbursements of £17 million). The majority of these provisions relate to the tax impact of intra-group transactions between the UK and the various jurisdictions in which the Group operates, as would be expected for a Group operating internationally.

The Group believes that it has made adequate provision in respect of additional tax liabilities that may arise from open years, tax audits and disputes. However, the actual liability for any particular issue may be higher or lower than the amount provided, resulting in a negative or positive effect on the tax charge in any given year. A reduction in the tax charge may also arise for other reasons such as an expiry of the relevant statute of limitations. Depending on the final outcome of tax audits which are currently in progress, statute of limitations expiry, and other factors, an impact on the tax charge could arise. The tax impact of intra-group transactions is a complex area and resolution of matters can take many years. Given the inherent uncertainty, it is difficult to predict the timing of when these matters will be resolved and the quantum of the ultimate resolution. Management estimate that the outcome across all matters under dispute or in negotiation between governments could be in the range of a decrease of £32 million, to an increase of £47 million, in the uncertain tax position over the next 12 months.

Legislative changes

The OECD Pillar Two GloBE Rules introduce a global minimum corporate tax rate of 15% applicable to multinational enterprise groups with global revenue over €750 million. All participating OECD members are required to incorporate these rules into national legislation. The Group will be subject to the Pillar Two Model Rules from FY 2024/25 but does not meet the threshold for application of the Pillar One transfer pricing rules. The Group applies the temporary exception from the accounting requirements for deferred taxes in IAS 12. Accordingly, the Group neither recognises nor discloses information about deferred tax assets and liabilities related to Pillar Two income taxes.

UK legislation in relation to Pillar Two was substantively enacted on 20 June 2023 and applies to the Group for the reporting period beginning 31 March 2024. The Group has performed an analysis of the potential exposure to Pillar Two income taxes. The analysis of the potential exposure to Pillar Two income taxes is based on the most recently submitted Country by Country Reporting available for the constituent entities in the Group (for the 52 weeks to 1 April 2023). Based on the analysis, the transitional safe harbour relief should apply in respect of most jurisdictions in which the Group operates. Although there are a limited number of jurisdictions where the transitional safe harbour relief may not apply, the Group does not expect a material exposure to Pillar Two income taxes in those jurisdictions.

9. Earnings per share

The calculation of basic earnings per share is based on profit or loss attributable to owners of the Company for the year divided by the weighted average number of ordinary shares in issue during the year. Basic and diluted earnings per share based on adjusted profit before taxation are also disclosed to indicate the underlying profitability of the Group.

	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Attributable profit for the year before adjusting items1	270	475
Effect of adjusting items1 (after taxation)	-	15
Attributable profit for the year	270	490

1.   Refer to note 6 for details of adjusting items.

The weighted average number of ordinary shares represents the weighted average number of Burberry Group plc ordinary shares in issue throughout the year, excluding ordinary shares held in the Group's ESOP trusts and treasury shares held by the Company or its subsidiaries. This includes the effect of the cancellation of 20.5 million shares during the period as a result of the share buyback programmes (prior year: 21.1 million). Refer to note 21 for additional information on the share buybacks.

Diluted earnings per share is based on the weighted average number of ordinary shares in issue during the year. In addition, account is taken of any options and awards made under the employee share incentive schemes, which will have a dilutive effect when exercised.

	52 weeks to 30 March 2024 Millions	52 weeks to 1 April 2023 Millions
Weighted average number of ordinary shares in issue during the year	365.0	386.1
Dilutive effect of the employee share incentive schemes	1.2	1.9
Diluted weighted average number of ordinary shares in issue during the year	366.2	388.0

 

	52 weeks to 30 March 2024 Pence	52 weeks to 1 April 2023 Pence
Earnings per share
Basic	74.1	126.9
Diluted	73.9	126.3
Adjusted earnings per share
Basic	74.1	123.1
Diluted	73.9	122.5

 

10. Dividends paid to owners of the Company

	52 weeks to 30 March 2024 £m	52 weeks to 1 April 2023 £m
Prior year final dividend paid 44.5p per share (last year: 35.4p)	167	140
Interim dividend paid 18.3p per share (last year: 16.5p)	66	63
Total	233	203

A final dividend in respect of the 52 weeks to 30 March 2024 of 42.7p (last year: 44.5p) per share, amounting to £151 million, has been proposed for approval by the shareholders at the Annual General Meeting subsequent to the balance sheet date. The final dividend has not been recognised as a liability at the year end and will be paid on 2 August 2024 to the shareholders on the register at the close of business on 28 June 2024. The ex-dividend date is 27 June 2024 and the final day for dividend reinvestment plan (DRIP) elections is 12 July 2024.

 

11. Intangible assets

Cost	Goodwill £m	Trademarks, licences and other intangible assets £m	Computer software £m	Intangible assets in the course of construction £m	Total £m
As at 2 April 2022	115	13	258	55	441
Effect of foreign exchange rate changes	-	-	1	-	1
Additions	-	1	13	32	46
Disposals	-	-	(42)	-	(42)
Reclassifications from assets in the course of construction	-	-	18	(18)	-
As at 1 April 2023	115	14	248	69	446
Effect of foreign exchange rate changes	(6)	-	(2)	-	(8)
Additions	-	1	8	44	53
Business combination	16	1	-	-	17
Disposals	-	-	(5)	(22)	(27)
Reclassifications from assets in the course of construction	-	-	30	(30)	-
As at 30 March 2024	125	16	279	61	481
Accumulated amortisation and impairment
As at 2 April 2022	6	7	169	19	201
Effect of foreign exchange rate changes	-	-	2	-	2
Charge for the year	-	1	36	-	37
Disposals	-	-	(42)	-	(42)
As at 1 April 2023	6	8	165	19	198
Effect of foreign exchange rate changes	-	-	(2)	-	(2)
Charge for the year	-	1	41	-	42
Disposals	-	-	(5)	(19)	(24)
As at 30 March 2024	6	9	199	-	214
Net book value
As at 30 March 2024	119	7	80	61	267
As at 1 April 2023	109	6	83	50	248

Impairment testing of goodwill

The carrying value of the goodwill allocated to cash generating units:

	As at 30 March 2024 £m	As at 1 April 2023 £m
Mainland China	46	50
South Korea	24	26
Retail and Wholesale segment1	35	19
Other	14	14
Total	119	109

1.   Goodwill which arose on acquisitions of Burberry Manifattura S.R.L. and Burberry Tecnica S.R.L. has been allocated to the group of cash generating units which make up the Group's Retail and Wholesale operating segment cash generating unit. This reflects the lowest level at which the goodwill is being monitored by management.

The Group tests goodwill for impairment annually or when there is an indication that goodwill might be impaired. The recoverable amount of all cash generating units has been determined on a value-in-use basis. Value-in-use calculations for each cash generating unit are based on projected pre-tax discounted cash flows together with a discounted terminal value. The cash flows have been discounted at pre-tax rates reflecting the Group's weighted average cost of capital adjusted for country-specific tax rates and risks. Where the cash generating unit has a non-controlling interest which was recognised at a value equal to its proportionate interest in the net identifiable assets of the acquired subsidiary at the acquisition date, the carrying amount of the goodwill has been grossed up, to include the goodwill attributable to the non-controlling interest, for the purpose of impairment testing the goodwill attributable to the cash generating unit. The key assumptions contained in the value-in-use calculations include the future revenues, the operating profit margins achieved and the discount rates applied.

The value-in-use calculations have been prepared using management's cost and revenue projections for the next three years to 27 March 2027 and a longer-term growth rate of 5% to 30 March 2029. A terminal value has been included in the value-in-use calculation based on the cash flows for the year ending 30 March 2029, incorporating the assumption that growth beyond 30 March 2029 is equivalent to nominal inflation rates, assumed to be 2%, which are not significant to the assessment.

The value-in-use estimates indicated that the recoverable amount of the cash generating unit exceeded the carrying value for each of the cash generating units. As a result, no impairment has been recognised in respect of the carrying value of goodwill in the year.

Impairment testing of goodwill continued

The goodwill arising on the acquisition of Burberry Tecnica S.R.L. has been allocated to the group of cash generating units which make up the Group's retail/wholesale operating segment. This reflects the level at which the goodwill is being monitored by management. For the material goodwill balances of Mainland China, South Korea and the Retail and Wholesale segment, management has considered the potential impact of reasonably possible changes in assumptions on the recoverable amount of goodwill. The sensitivities include applying a 10% reduction in revenue and gross profit and the associated impact on operating profit margin from management's base cash flow projections, considering the macroeconomic and political uncertainty risk on the Group's retail operations and on the global economy. Under this scenario, the estimated recoverable amount of goodwill in Mainland China, South Korea and the Retail and Wholesale segment still exceeded the carrying value.

The pre-tax discount rates for Mainland China, South Korea and the Retail and Wholesale segment were 12%, 10% and 11% respectively (last year: Mainland China 12%, South Korea 12%, and the Retail and Wholesale segment 12%). No reasonably possible change in these pre-tax discount rates would result in the carrying value to exceed the estimated recoverable amount of goodwill.

The other goodwill balance of £14 million (last year: £14 million) consists of amounts relating to eight cash generating units, none of which have goodwill balances individually exceeding £6 million as at 30 March 2024 (last year: £7 million).

12. Property, plant and equipment

Cost	Freehold land and buildings £m	Leasehold improvements £m	Fixtures, fittings and equipment £m	Assets in the course of construction £m	Total £m
As at 2 April 2022	116	550	348	47	1,061
Effect of foreign exchange rate changes	6	6	9	1	22
Additions	-	56	25	66	147
Disposals	(1)	(53)	(27)	(1)	(82)
Reclassifications from assets in the course of construction	-	26	11	(37)	-
As at 1 April 2023	121	585	366	76	1,148
Effect of foreign exchange rate changes	(2)	(27)	(8)	(3)	(40)
Additions	-	88	32	44	164
Business combination	-	-	1	-	1
Disposals	-	(69)	(47)	-	(116)
Reclassifications from assets in the course of construction	-	54	14	(68)	-
Reclassifications to assets held for sale	(28)	-	-	-	(28)
As at 30 March 2024	91	631	358	49	1,129
Accumulated depreciation and impairment
As at 2 April 2022	56	388	294	1	739
Effect of foreign exchange rate changes	4	6	8	-	18
Charge for the year	3	64	28	-	95
Disposals	(1)	(53)	(27)	(1)	(82)
Impairment charge on assets	-	2	-	-	2
As at 1 April 2023	62	407	303	-	772
Effect of foreign exchange rate changes	-	(17)	(8)	-	(25)
Charge for the year	2	69	32	-	103
Disposals	-	(69)	(47)	-	(116)
Impairment charge on assets	-	4	1	-	5
Reclassifications to assets held for sale	(16)	-	-	-	(16)
As at 30 March 2024	48	394	281	-	723
Net book value
As at 30 March 2024	43	237	77	49	406
As at 1 April 2023	59	178	63	76	376

 

During the 52 weeks to 30 March 2024, management carried out a review of retail cash generating units comprising right-of-use asset and property, plant and equipment, for any indication of impairment or reversal of impairments previously recorded. Where indications of impairment charges or reversals were identified, the impairment review compared the value-in-use of the cash generating units to their net book values at 30 March 2024. The pre-tax cash flow projections used for this review were based on financial plans of expected revenues and costs of each retail cash generating unit, approved by management, reflecting their latest plans over the next three years to 27 March 2027. For the remainder of the asset life, the cashflows assume industry growth rates of 5% and cost inflation rates appropriate to each store's location, followed by longer-term growth rates of mid-single digits and inflation rates appropriate to each store's location. The pre-tax discount rates used in these calculations were between 10.2% and 12.1% (last year: between 11.1% and 13.7%) based on the Group's weighted average cost of capital adjusted for country-specific borrowing costs, tax rates and risks for those countries in which a charge or reversal was incurred. Where indicators of impairment have been identified and the value-in-use was less than the carrying value of the cash generating unit, an impairment of property, plant and equipment and right-of-use asset was recorded. Where the value-in-use was greater than the net book value, and the cash generating unit had been previously impaired, the impairment was reversed, to the extent that could be supported by the value-in use and allowing for any depreciation that would have been incurred during the period since the impairment was recorded.

During the 52 weeks to 30 March 2024, a charge of £14 million (last year: net charge of £7 million) was recorded within net operating expenses as a result of the annual review of impairment for retail store assets. A charge of £5 million (last year: charge of £2 million) was recorded against property, plant and equipment and a charge of £9 million (last year: net charge of £5 million) was recorded against right-of-use assets. Impairments previously charged as an adjusting item related to the impact of COVID-19 were reassessed, resulting in no impairment charge or reversal being presented as an adjusting item in the current year (last year: net reversal of £6 million recorded against right-of-use assets). Refer to note 13 for further details of right-of-use assets. Refer to note 6 for details of adjusting items.

The impairment charge recorded in property, plant and equipment related to six retail cash generating units (last year: two retail cash generating units) for which the total recoverable amount at the balance sheet date is £15 million (last year: £1 million).

Management has considered the potential impact of changes in assumptions on the impairment recorded against the Group's retail assets. Given the macroeconomic and political uncertainty risk on the Group's retail operations and on the global economy, management has considered sensitivities to the impairment charge as a result of changes to the estimate of future revenues achieved by the retail stores. The sensitivities applied are an increase or decrease in revenue of 10% from the estimate used to determine the impairment charge or reversal. We have also considered retail cash generating units with no indicators of impairment but with a significant asset balance. It is estimated that a 10% decrease/increase in revenue assumptions for the 52 weeks to 29 March 2025, with no change to subsequent forecast revenue growth rate assumptions, would result in a less than £19 million increase/less than £9 million decrease in the impairment charge of retail store assets in the 52 weeks to 30 March 2024.

As at 30 March 2024, the Group had one freehold property that met the criteria to be classified as held for sale. This asset is required to be recorded at the lower of carrying value or fair value less any costs to sell. As the fair value less any costs to sell exceeded the carrying value, the related asset was recorded at its carrying value of £12 million. The sale of this property is expected to complete within the next 12 months.

No assets were classified as held for sale at 1 April 2023. During the 52 weeks to 1 April 2023, the sale of three freehold properties with a carrying value of £13 million, which were previously classified as assets held for sale, was completed resulting in a net gain on disposal of £19 million.

 

13. Right-of-use assets

Net book value	Property right- of-use assets £m
As at 2 April 2022	880
Effect of foreign exchange rate changes	14
Additions	157
Remeasurements	113
Depreciation for the year	(212)
Impairment charge on right-of-use assets	(10)
Impairment reversal on right-of-use assets	8
As at 1 April 2023	950
Effect of foreign exchange rate changes	(27)
Additions	162
Business combination	2
Remeasurements	169
Depreciation for the year	(234)
Impairment charge on right-of-use assets	(9)
As at 30 March 2024	1,013

As a result of the assessment of retail cash generating units for impairment, an impairment charge of £9 million (last year: net impairment reversal of £1 million) was recorded for impairment of right-of-use assets related to trading impacts. Refer to note 12 for further details of impairment assessment of retail cash generating units. The net impairment reversal in the prior year comprised a reversal of £6 million arising from the change in assumption due to the impact of COVID-19 on the value-in-use of retail cash generating units and a charge of £5 million relating to other trading impacts. The reversal relating to COVID-19 was presented as an adjusting item (refer to note 6).

The impairment charge recorded in right-of-use assets relates to seven retail cash generating units (last year: three retail cash generating units) for which the total recoverable amount at the balance sheet date is £44 million (last year: £17 million).

At 1 April 2023, a net impairment charge of £3 million was recognised in relation to non-retail right-of-use assets arising as a result of the Group's restructuring programmes and was presented as an adjusting item (refer to note 6).

As a result, the impairment charge for right-of-use assets was £9 million (last year: net impairment charge of £2 million).

14. Trade and other receivables

	As at 30 March 2024 £m	As at 1 April 2023 £m
Non-current
Other financial receivables1	47	45
Other non-financial receivables2	-	2
Prepayments	5	5
Total non-current trade and other receivables	52	52
Current
Trade receivables	189	184
Provision for expected credit losses	(10)	(7)
Net trade receivables	179	177
Other financial receivables1	27	25
Other non-financial receivables2	86	59
Prepayments	33	32
Accrued income	15	14
Total current trade and other receivables	340	307
Total trade and other receivables	392	359

1. Other financial receivables include rental deposits and other sundry debtors.

2. Other non-financial receivables relates primarily to indirect taxes and other taxes and duties.

Included in total trade and other receivables are non-financial assets of £124 million (last year: £98 million).

 

15. Inventories

	As at 30 March 2024 £m	As at 1 April 2023 £m
Raw materials	29	15
Work in progress	3	1
Finished goods	475	431
Total inventories	507	447

 

	As at 30 March 2024 £m	As at 1 April 2023 £m
Total inventories, gross	580	504
Provisions	(73)	(57)
Total inventories, net	507	447

Inventory provisions of £73 million (last year: £57 million) are recorded, representing 12.6% (last year: 11.4%) of the gross value of inventory. The provisions reflect management's best estimate of the net realisable value of inventory, where this is considered to be lower than the cost of the inventory.

The cost of inventories recognised as an expense and included in cost of sales amounted to £922 million (last year: £874 million).

Taking into account factors impacting the inventory provisioning including the proportion of inventory sold through loss making channels being higher or lower than expected, management considers that a reasonable potential range of outcomes could result in an increase in inventory provisions of £15 million or a decrease in inventory provisions of £22 million in the next 12 months. This would result in a potential range of inventory provisions of 8.8% to 15.3% as a percentage of the gross value of inventory as at 30 March 2024.

The net movement in inventory provisions included in cost of sales for the 52 weeks to 30 March 2024 was a charge of £39 million (last year: release of £1 million). The total reversal of inventory provisions during the current year, which is included in the net movement, was £15 million (last year: reversal of £22 million). In the prior year, a reversal of £1 million was included within both of these amounts upon reassessment of the provision related to the impact of COVID-19 and was presented as an adjusting item. Refer to note 6 for details of adjusting items.

16. Cash and cash equivalents

	As at 30 March 2024 £m	As at 1 April 2023 £m
Cash and cash equivalents held at amortised cost Cash at bank and in hand	180	152
Short-term deposits	83	77
	263	229
Cash and cash equivalents held at fair value through profit and loss
Short-term deposits	178	797
Total	441	1,026

Cash and cash equivalents classified as fair value through profit and loss relate to deposits held in low volatility net asset value money market funds. The cash is available immediately and, since the funds are managed to achieve low volatility, no significant change in value is anticipated. The funds are monitored to ensure there are no significant changes in value.

As at 30 March 2024 and 1 April 2023, no impairment losses were identified on cash and cash equivalents held at amortised cost.

 

17. Trade and other payables

	As at 30 March 2024 £m	As at 1 April 2023 £m
Non-current
Other payables1	3	-
Deferred income and non-financial accruals	9	20
Contract liabilities	51	57
Total non-current trade and other payables	63	77
Current
Trade payables	180	186
Other taxes and social security costs	45	50
Other payables1	21	10
Accruals	165	199
Deferred income and non-financial accruals	11	14
Contract liabilities	12	13
Deferred consideration2	5	5
Total current trade and other payables	439	477
Total trade and other payables	502	554

1.   Other payables comprise interest and employee-related liabilities.

2.   Deferred consideration relates to the acquisition of the economic right to the non-controlling interest in Burberry Middle East LLC on 22 April 2016. In the 52 weeks to 30 March 2024 no payments were made in relation to Burberry Middle East LLC (last year: £6 million). Contingent payments of £5 million remain outstanding at 30 March 2024, which will be paid once all required documentation is complete.

18. Lease liabilities

	Property lease liabilities £m
Balance as at 2 April 2022	1,058
Effect of foreign exchange rate changes	20
Created during the year	157
Amounts paid1	(243)
Discount unwind	33
Remeasurements2	98
Balance as at 1 April 2023	1,123
Effect of foreign exchange rate changes	(30)
Created during the year	159
Business combination	1
Amounts paid1	(274)
Discount unwind	43
Remeasurements2	166
Balance as at 30 March 2024	1,188

 

	As at 30 March 2024 £m	As at 1 April 2023 £m
Analysis of total lease liabilities:
Non-current	959	902
Current	229	221
Total	1,188	1,123

1.   The amount paid of £274 million (last year: £243 million) includes £231 million (last year: £210 million) arising as a result of a financing cash outflow and £43 million (last year: £33 million) arising as a result of an operating cash outflow.

2.   Remeasurements relate largely to changes in the lease liabilities that arise as a result of extending the lease term on an existing lease, management's reassessment of the lease term based on existing break or extension options in the contract, as well as those linked to an inflation index or rate review. In the prior year, remeasurements included COVID-19-related rent forgiveness of £13 million which was recognised as a credit in the Income Statement and was included as an adjusting item. Refer to note 6.

The Group enters into property leases for retail properties, including stores, concessions, warehouse and storage locations and office property. The remaining lease terms for these properties range from a few months to 16 years (last year: few months to 15 years). Many of the leases include break options and/or extension options to provide operational flexibility. Some of the leases for concessions have rolling lease terms or rolling break options. Management assess the lease term at inception based on the facts and circumstances applicable to each property including the period over which the investment appraisal was initially considered.

Potential future undiscounted lease payments related to periods following the exercise date of an extension option not included in the lease term, and therefore not included in lease liabilities are approximately £434 million (last year: £399 million) in relation to the next available extension option and are assessed as not reasonably certain to be exercised. Potential future undiscounted lease payments related to periods following the exercise date of a break option not included in the lease term, and therefore not included in lease liabilities, are approximately £113 million (last year: £130 million) in relation to break options which are expected to be exercised. During the 52 weeks to 30 March 2024, significant judgements regarding breaks and options in relation to individually material leases resulted in approximately £100 million (last year: £38 million) in undiscounted future cash flows not being included in the initial right-of-use assets and lease liabilities.

Management reviews the retail lease portfolio on an ongoing basis, taking into account retail performance and future trading expectations. Management may exercise extension options and negotiate lease extensions or modifications. In other instances, management may exercise break options, negotiate lease reductions or decide not to negotiate a lease extension at the end of the lease term. The most significant factor impacting future lease payments is changes management choose to make to the store portfolio.

Future increases and decreases in rent linked to an inflation index or rate review are not included in the lease liability until the change in cash flows is legally agreed. Approximately 19% (last year: 18%) of the Group's lease liabilities are subject to inflation linked reviews and 32% (last year: 30%) are subject to rent reviews. Rental changes linked to inflation or rent reviews typically occur on an annual basis.

Many of the retail property leases also incur payments based on a percentage of revenue achieved at the location. Changes in future variable lease payments will typically reflect changes in the Group's retail revenues, including the impact of regional mix. The Group expects the relative proportions of fixed and variable lease payments to remain broadly consistent in future years.

The Group also enters into non-property leases for equipment, advertising fixtures and machinery. Generally, these leases do not include break or extension options. The most significant impact to future cash flows relating to leased equipment, which are primarily short-term leases, would be the Group's usage of leased equipment to a greater or lesser extent.

Details of income statement charges and income from leases are set out in note 5. The right-of-use asset categories on which depreciation is incurred are presented in note 13. Interest expense incurred on lease liabilities is presented in note 7.

Total cash outflows in relation to leases in the 52 weeks ended 30 March 2024 are £417 million (last year: £396 million). This relates to payments of £231 million on lease principal (last year: £210 million), £43 million on lease interest (last year: £33 million), £113 million on variable lease payments (last year: £122 million), and £30 million on other lease payments principally relating to short-term leases and leases in holdover (last year: £31 million).

19. Bank overdrafts

Included within bank overdrafts is £78 million (last year: £65 million) representing balances on cash pooling arrangements in the Group.

The Group has a number of committed and uncommitted arrangements agreed with third parties. At 30 March 2024, the Group held £1 million (last year: £nil) bank overdrafts excluding balances on cash pooling arrangements.

The fair value of overdrafts approximates the carrying amount because of the short maturity of these instruments.

20. Borrowings

On 21 September 2020, Burberry Group plc issued medium term notes with a face value of £300 million and 1.125% coupon maturing on 21 September 2025 (the sustainability bond). Proceeds from the sustainability bond have been used by the Group to finance projects which support the Group's sustainability agenda. There are no financial penalties for not using the proceeds as anticipated. Interest on the sustainability bond is payable semi-annually. The carrying value of the bond at 30 March 2024 is £299 million (last year: £298 million); all movements on the bond are non-cash. The fair value of the bond at 30 March 2024 is £281 million (last year: £273 million).

On 26 July 2021, the Group entered into a £300 million multi-currency sustainability-linked revolving credit facility (RCF) with a syndicate of banks, maturing on 26 July 2026. There were no drawdowns or repayments of the RCF during the current or previous year, and at 30 March 2024 there were no outstanding drawings.

The Group is in compliance with the financial and other covenants within the facilities above and has been in compliance throughout the financial period.

 

21. Share capital and reserves

Allotted, called up and fully paid share capital	Number	£m
Ordinary shares of 0.05p (last year: 0.05p) each
As at 2 April 2022	405,107,301	0.2
Allotted on exercise of options during the year	236,123	-
Cancellation of shares	(21,075,496)	-
As at 1 April 2023	384,267,928	0.2
Allotted on exercise of options during the year	51,904	-
Cancellation of shares	(20,504,089)	-
As at 30 March 2024	363,815,743	0.2

The Company has a general authority from shareholders, renewed at each Annual General Meeting, to repurchase a maximum of 10% of its issued share capital. During the 52 weeks to 30 March 2024, the Company entered into agreements to purchase, at fair value, a total of £400 million of its own shares, excluding stamp duty and fees, through two share buyback programmes of £200 million each (last year: two share buyback programmes of £200 million each). Both programmes were completed during the year.

The cost of own shares purchased by the Company, as part of a share buyback programme, is offset against retained earnings, as the amounts paid reduce the profits available for distribution by the Company. When shares are cancelled, a transfer is made from retained earnings to the capital reserve, equivalent to the nominal value of the shares purchased and subsequently cancelled. In the 52 weeks to 30 March 2024, 20.5 million shares were cancelled (last year: 21.1 million).

As at 30 March 2024 the Company held 5.2 million treasury shares (last year: 6.1 million), with a market value of £63 million (last year: £157 million) based on the share price at the reporting date. The treasury shares held by the Company are related to the share buyback programme completed during the 53 weeks to 2 April 2022. During the 52 weeks to 30 March 2024, 0.9 million treasury shares were transferred to ESOP trusts (last year: 2.3 million). During the 52 weeks to 30 March 2024, no treasury shares were cancelled (last year: none).

The cost of shares purchased by ESOP trusts are offset against retained earnings, as the amounts paid reduce the profits available for distribution by the Company. As at 30 March 2024, the cost of own shares held by ESOP trusts and offset against retained earnings is £34 million (last year: £42 million). As at 30 March 2024, the ESOP trusts held 1.9 million shares (last year: 2.3 million) in the Company, with a market value of £23 million (last year: £60 million). In the 52 weeks to 30 March 2024 the ESOP trusts and the Company have waived their entitlement to dividends.

Other reserves in the Statement of Changes in Equity consist of the capital reserve, the foreign currency translation reserve, and the hedging reserves. The hedging reserves consist of the cash flow hedge reserve and the net investment hedge reserve.

	Capital reserve £m	Hedging reserves		Foreign currency translation  reserve £m	Total £m
		Cash flow hedges £m	Net investment hedge £m
Balance as at 2 April 2022	41	(1)	5	218	263
Other comprehensive income:
Cash flow hedges - gains deferred in equity	-	1	-	-	1
Foreign currency translation differences	-	-	-	14	14
Tax on other comprehensive income	-	(1)	-	-	(1)
Total comprehensive income for the year	-	-	-	14	14
Balance as at 1 April 2023	41	(1)	5	232	277
Other comprehensive income:
Cash flow hedges - losses deferred in equity	-	(4)	-	-	(4)
Cash flow hedges - transferred to income	-	1	-	-	1
Foreign currency translation differences	-	-	-	(34)	(34)
Tax on other comprehensive income	-	1	-	-	1
Total comprehensive income for the year	-	(2)	-	(34)	(36)
Balance as at 30 March 2024	41	(3)	5	198	241

As at 30 March 2024 the amount held in the hedging reserve relating to matured net investment hedges is £5 million net of tax (last year: £5 million).

 

22. Commitments

Capital commitments

Contracted capital commitments represent contracts entered into by the year end for future work in respect of major capital expenditure projects relating to property, plant and equipment and intangible assets, which are not recorded on the Group's Balance Sheet and are as follows:

	As at 30 March 2024 £m	As at 1 April 2023 £m
Capital commitments contracted but not provided for:
Property, plant and equipment	67	38
Intangible assets	4	3
Total	71	41

23. Acquisition of subsidiary

On 2 October 2023, Burberry Italy S.R.L., Burberry's wholly-owned subsidiary, acquired a 100% shareholding in Burberry Tecnica, S.R.L., from Italian technical outerwear supplier, Pattern SpA, a company incorporated in Italy, for total cash consideration of £19 million. Consideration for this acquisition did not includes any contingent or deferred consideration.

Based in Turin, the activities of the business acquired revolve around the engineering and production of Burberry products. The acquisition allows the Group to secure capacity, build technical outerwear capabilities and further embed sustainability into its value chain.

The assets and liabilities recognised as a result of the acquisition are as follows:

	Provisional Fair value £m
Net assets acquired
Acquired intangible assets	1
Property, plant and equipment	1
Inventories	2
Right-of-use assets	2
Lease liabilities	(1)
Employee-related liabilities	(1)
Deferred tax liability	(1)
Net assets acquired	3
Goodwill arising on acquisition	16
Total cost of acquisition	19

No receivables or contingent liabilities were acquired as a result of the acquisition.

The values used in accounting for the identifiable assets and liabilities of the acquisition are provisional in nature as they are still being determined. If necessary, adjustments will be made to these carrying values and the related goodwill, within 12 months of the acquisition date.

The goodwill arising on the acquisition of £16 million reflects the expected synergies from the vertical integration of engineering and production of technical outerwear within the Group's supply chain, together with the value of the retained workforce. The goodwill has been allocated to the group of cash generating units which make up the Group's retail/wholesale operating segment. £13 million of the goodwill is expected to be deductible for tax purposes, giving rise to an overall tax benefit with an estimated net present value of approximately £1 million.

The acquired business has made a contribution to Group revenue of £nil and had a negligible impact on Group profit before taxation since acquisition. If the acquisition had occurred at the beginning of the financial year, the impact on the Group's revenue and profit or loss would not have been material.

24. Contingent liabilities

The Group is subject to claims against it and to tax audits in a number of jurisdictions which arise in the ordinary course of business. These typically relate to Value Added Taxes, sales taxes, customs duties, corporate taxes, transfer pricing, payroll taxes, various contractual claims, legal proceedings and other matters. Where appropriate, the estimated cost of known obligations has been provided in these financial statements in accordance with the Group's accounting policies. The Group does not expect the outcome of current similar contingent liabilities to have a material effect on the Group's financial position.