Frasers Group profits rise despite Budget impact and luxury market challenges

Frasers Group delivered another year of record growth for the 52 weeks ending 27 April 2025, despite a decline in revenue.

The owner of Frasers, Flannels and Sports Direct reported a APBT of £560.2 million, up 2.8%, as it continued to build "a broader platform for multi-year, sustainable profitable growth". As part of this, Frasers Group delivered £127.2 million of underlying cost-savings and synergy benefits, largely from recent investments in warehouse automation and acquisitions.

However, revenue declined 7.4% to £4.7 billion, primarily due to planned reductions in segments such as Game UK and Studio Retail. This was partially offset by "strong" sales growth at Sports Direct and the continued success of its Elevation Strategy, alongside strengthened relationships with key brands such as Nike and Hugo Boss.

UK Sports accounted for 54.7% of the company's total revenue and marked a "breakthrough" year for Sports Direct’s international expansion. The British retailer expanded its global footprint through new and extended strategic partnerships and acquisitions, laying the groundwork for long-term global growth.

Its omnichannel shopping experience was also improved during the year with the launch of a new Sports Direct app and the introduction of the Sports Direct Membership programme.

Elsewhere, the luxury market remained challenging, though Frasers Group noted some "early signs of improvement".

Premium Lifestyle contributed 21.3% of total revenue; however, revenue declined 14.8% as the group continued to optimise its store portfolio. This included a strategic reduction in the number of stores across House of Fraser and recently acquired businesses from JD Sports, decreasing from 44 to 29 stores by 27 April 2025.

It also expanded its presence in UK luxury and premium retail, opening 12 new stores across Flannels, Frasers and Sports Direct.

The group made further investments in UK property to "support its growing occupational needs", with key acquisitions including Doncaster’s Frenchgate Shopping Centre, Exeter’s Princesshay, Maidstone’s Fremlin Walk, and several Affinity outlet locations.

Looking ahead for FY26, Frasers said it is "mindful" of ongoing macroeconomic headwinds and continues to anticipate at least £50 million in incremental costs stemming from last year’s Budget.

However, the group remains committed to long-term investment in its Elevation Strategy and international expansion, and currently expects APBT to be in the range of £550 million to £600 million.

Michael Murray, Chief Executive at Frasers Group, said: "I’m pleased with our performance this year, despite the headwinds caused by last year’s Budget. We remain fully committed to our Elevation Strategy, which drove another record year of profitable growth and further delivery of our key priorities.

"We continued our strategy of confidently investing for the future, unlocking multiple opportunities for sustainable medium- to long-term growth.

"For FY26 so far, we are seeing positive momentum across the group, including strong performance at Sports Direct – and we have big ambitions to continue to raise the bar.

"Looking further forward, we remain confident in our strategy and our plans to deliver multi-year, sustainable profitable growth."