We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register for streaming realtime charts, analysis tools, and prices.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Burberry Group Plc | LSE:BRBY | London | Ordinary Share | GB0031743007 | ORD 0.05P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 7.50 | 0.66% | 1,152.00 | 1,157.50 | 1,158.00 | 1,174.00 | 1,143.00 | 1,156.50 | 1,240,060 | 16:35:25 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Misc Apparel,accesory Stores | 3.09B | 490M | 1.3394 | 8.64 | 4.23B |
From Apr 2019 to Apr 2024
TIDMBRBY
RNS Number : 4825Q
Burberry Group PLC
06 June 2018
6 June 2018
Annual Financial Report
Pursuant to Listing Rule 9.6.1, Burberry Group plc (the "Group") has submitted the following documents to the National Storage Mechanism and they will shortly be available for inspection at www.morningstar.co.uk/uk/NSM:
1. Annual Report and Accounts for the year ended 31 March 2018;
2. Notice of 2018 Annual General Meeting; and
3. Form of Proxy for the 2018 Annual General meeting.
The Annual Report and Notice of 2018 Annual General Meeting are also available on the Burberry Group plc website at www.burberryplc.com. The Annual Report will be delivered to the Registrar of Companies in due course.
The Annual General Meeting ("AGM") will take place on Thursday, 12 July 2018 at Conrad London St. James, 22-28 Broadway, London, SW1H 0BH. The total of the votes cast by shareholders for or against or withheld on each resolution to be put to the meeting will be published on www.burberryplc.com as soon as possible after the meeting.
In compliance with The Disclosure Guidance and Transparency Rules (DTR) 6.3.5, the information in the Appendix below is extracted from Burberry Group plc's Annual Report and Accounts for the financial year ended 31 March 2018 (the "2017/18 Annual Report and Accounts") and should be read in conjunction with Burberry Group plc's Preliminary Announcement issued on 16 May 2018, both of which can be viewed at www.burberryplc.com. Together these constitute the material required by DTR 6.3.5 to be communicated to the media in unedited full text through a Regulatory Information Service. This material is not a substitute for reading the 2017/18 Annual Report and Accounts in full and page numbers and cross-references in the extracted information below refer to page numbers and cross-references in the 2017/18 Annual Report and Accounts.
Enquiries
Hot Features
Premium
Investors and analysts 020 3367 3234
Charlotte VP, Investor charlotte.cowley@burberry.com
Cowley Relations
Media 020 3367 3764
Andrew Roberts VP, Corporate andrew.roberts@burberry.com
Relations
APPIX: ADDITIONAL INFORMATION REQUIRED BY DTR 6.3.5
AUDIT REPORTS
The Preliminary Announcement includes a condensed set of financial statements. Audited financial statements for the financial year ended 31 March 2018 are contained in the 2017/18 Annual Report and Accounts. The Independent Auditors' Report on the Group financial statements and the parent company financial statements is set out in full on pages 129 to 136 of the 2017/18 Annual Report and Accounts. The audit report is unqualified and does not contain any statements under section 498(2) or section 498(3) of the Companies Act 2006.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The following information is extracted from page 128 of the 2017/18 Annual Report and Accounts.
The directors consider that the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group and the Company's position and performance, business model and strategy.
Each of the directors, whose names and functions are listed on pages 72 to 73 confirm that, to the best of their knowledge:
- the Company financial statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 101 'Reduced Disclosure Framework', and applicable law), give a true and fair view of the assets, liabilities, financial position and profit of the Company;
- the Group financial statements, which have been prepared in accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the Group; and
- the Strategic Report includes a fair review of the development and performance of the business and the position of the Group and the Company, together with a description of the principal risks and uncertainties that it faces.
PRINCIPAL RISKS
The following information is extracted from pages 54 to 65 of the 2017/18 Annual Report and Accounts.
OUR APPROACH TO RISK
Our strategy takes into account risks, as well as opportunities, which need to be actively managed. Effective risk management is essential to executing our strategies, achieving sustainable shareholder value, protecting the brand and ensuring good governance.
The Board is ultimately responsible for determining the nature and extent of the principal risks it is willing to take in achieving our strategic objectives (the Board's risk appetite), and challenging management's implementation of effective systems of risk identification, assessment and mitigation.
The Audit Committee has been delegated the responsibility for reviewing the effectiveness of the Group's internal controls and risk management arrangements. Ongoing review of these controls is provided through internal governance processes and the work of the Group functions is overseen by executive management, particularly the work of our Group Risk and Assurance Team and the Management Risk Committee.
Our risk management process is an integral part of our business, which is coordinated by our Group Risk and Assurance Team, reporting to our Chief Operating and Financial Officer. Risk management activities include identifying risks, undertaking risk assessments and determining mitigating actions. These activities are reviewed by Internal Audit and other control functions, which provide assurance to our Management Risk Committee, and ultimately to our Board of Directors and Board Committees, as shown in the diagram below.
Board of Directors and Board Committees
-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Responsible for Monitors risks Audit Committee
regular oversight through Board reviews effectiveness
of risk management, processes (Strategy of risk management
for annual strategic Review, Audit process with support
risk review and Committee), management from Internal
setting the Group's reports and deep Audit
risk appetite dives of selected
risk areas
------------------------------------------------------------ ------------------------------------------------------- ------------------------------------------------------------
Management Risk Committee (Chaired by Chief
Operating & Financial Officer)
-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Reviews external Meets at least Identifies changes
and internal three times per to significant
environment for year and reports risks and the
emerging risks key findings effectiveness
Performs deep to the Audit and adequacy of
dive reviews Committee mitigating actions
of principal Cross-functional to achieve agreed
risks attendees, encompassing risk tolerance
Reviews risk senior management levels
register updates from IT, Finance,
from risk owners Legal, HR, Supply
Chain and Retail
------------------------------------------------------------ ------------------------------------------------------- ------------------------------------------------------------
Group Risk & Functions and Internal Audit
Assurance Team Business Risk and Compliance
owners Functions
------------------------------------------------------------ ------------------------------------------------------- ------------------------------------------------------------
* Establishes risk management framework * Carry out day-to-day risk management activities * Review risk management process periodically
* Facilitates updates to risk registers * Identify and assess risk and implement action to * Functions provide independent assurance to management
mitigate risk within their area and Board on risk status (Health & Safety, Legal,
Brand Protection, Quality, Asset and Profit
* Provides resources and training to support process Protection, Responsibility)
* Assign owners to risks to update risk registers
* Prepares Board and Management Risk Committee updates
------------------------------------------------------------ ------------------------------------------------------- ------------------------------------------------------------
Risk Appetite
This year, we have strengthened our definition of risk appetite and integrated this into our wider risk management framework to support better decision making. This exercise was reviewed and validated by the Board and, going forward, will be performed on an annual basis.
We will pursue growth and are prepared to accept a certain level of risk to firmly establish our position in luxury fashion and inspire our customers with our unique British attitude. We operate in a competitive, dynamic sector with long--term growth potential. Within categories of risk our tolerance for risk may vary.
Complying with applicable laws and doing the right thing is part of our culture and underpins our strategic ambition. In exploring risks and opportunities, we prioritise the interests and safety of our customers and employees and we seek to protect the long-term value and reputation of the brand, maximising commercial benefits to support responsible and sustained growth, and in doing so minimise risk.
OUR PRINCIPAL RISKS
Our risk management process has identified a broad range of risks and uncertainties, which we believe could adversely impact the profitability or prospects of the Group. Our principal risks are defined as those that we regard as the most relevant to our business. These are the risks that we see as most material to our performance and could threaten our business model or the future long-term performance, solvency or liquidity of Burberry.
Our risk management framework is structured along the following categories of risk: Strategic and Financial, Operational, Compliance and External. Each principal risk is linked to one of these categories and may impact one or more of our strategic pillars.
We have updated the descriptions and mitigating actions of several of our principal risks to reflect the new strategic priorities that have been announced. We have also reviewed whether the level of risk associated with each of the principal risks is increasing or decreasing compared to last year and noted new risks which do not have a comparison.
STRATEGIC AND FINANCIAL RISKS
EXECUTION OF STRATEGIC PLAN
Focused execution of the strategy through our six
Strategic Pillars: Product, Communication, Distribution,
Digital, Operational Excellence and Inspired People
is key to sustainable shareholder value.
Success depends on the value and relevance of our
brand to global luxury consumers around the world
and our ability to innovate. Failure to execute
these strategies successfully could result in under--delivery
of the expected growth, productivity and efficiency
targets. This could have a significant impact on
the value of the business and market confidence
that we can deliver the strategy.
We operate in the global luxury market, where competition
is intensifying. Today's luxury customers demand
creativity, curation, excitement, innovation and
personalisation at every turn. Our ability to make
the right strategic investment decisions in response
to these changes is vital to our success.
Change from FY 2016/17: During the year we have
focused on building the team to develop and deliver
our strategy and detailed plans.
--------------------------------------------------------------------------------------------------
Link to strategy Actions taken by management
---------------------------------- --------------------------------------------------------------
All strategic pillars.
---------------------------------- --------------------------------------------------------------
Risk tolerance
----------------------------------
We will pursue growth and
accept a certain level of
risk to ignite brand heat
and firmly establish our
position in luxury fashion.
We approve capital investment
in strategic projects and
accept moderate to high earnings
volatility in pursuit of
innovation and profitable
growth, balancing a reasonable
return on capital with a
reasonable level of commercial
risk within the approved
capital allocation framework.
----------------------------------
Examples of risks
----------------------------------
Firmly positioning the brand * Throughout the year we have focused on building the
in luxury is dependent on capabilities to develop and deliver our strategy. The
creating new and innovative Executive Team is accountable for the conduct of
luxury products that excite these programmes and delivery of outcomes in
our global customers. If accordance with our Board-approved plan.
we are unable to innovate
effectively and introduce
these new products to the * A Transformation Management Office coordinates
market with speed, our sales delivery of the programme, monitoring risks of each
or margins could be adversely of the major programmes and tracking progress and
affected. benefits.
Our development and deployment
of content through communication
channels does not create * During FY 2017/18 we introduced a new assortment of
sufficient brand heat globally. products and full looks to inspire the new fashion
We do not achieve the required consumer, launched our new line of leather goods and
organisational alignment appointed a new Chief Creative Officer.
and enhance our capabilities
and culture to compete and
grow effectively at the pace * We have increased our focus on digital and social
required to deliver the targets. channels. We started our content revolution in 2017
Failure to sufficiently transform and re-launched our website, burberry.com, in early
operational processes undermines 2018.
our ability to deliver the
required cost savings and
margin improvements. * Our Inspired People initiative includes targeted
Failure to deliver the technology programmes to inform and engage employees about the
innovation required to empower strategy, develop leadership capabilities and drive
changes in the Group's business the right behaviours.
model and to deliver the
anticipated benefits from
key investment strategies * Our Operational Excellence programme is in progress
in Digital, Retail and Group as demonstrated by the successful opening of Burberry
operations. Business Services in Leeds.
* There is a clear IT strategy prepared by the Chief
Information Officer and IT Leadership Team comprised
of a portfolio of IT projects linked to the Company's
strategic objectives.
---------------------------------- --------------------------------------------------------------
FOREIGN EXCHANGE
Volatility in foreign exchange rates could have a significant impact on the Group's reported results. Burberry is exposed to uncertainty through foreign exchange movements. Change from FY 2016/17: No change ----------------------------------------------------------------------------------------------- Link to strategy Actions taken by management ----------------------------- -------------------------------------------------------------- Volatility in foreign exchange rates may impact our overall financial performance. ----------------------------- -------------------------------------------------------------- Risk TOLERANCE ----------------------------- The Group does not currently seek to manage structural foreign exchange risk relating to intercompany transactions with its overseas retail operations. ----------------------------- Examples of risks ----------------------------- The Group operates on a global basis and earns revenues, incurs costs and makes investments in a number of currencies. The * The Group seeks to hedge anticipated foreign currency Group's financial transactional cash flows using financial instruments. results are reported These are mainly in the Group's centralised supply in Sterling. Most chain and wholesale business. The Group does not reported revenues hedge intra-group foreign currency transactions at are earned in non-Sterling present. currencies, with a significant proportion of costs in Sterling. * The Group monitors the desirability of hedging the
Therefore, changes net assets of non-Sterling subsidiaries when in exchange rates translated into Sterling for reporting purposes; we which are driven by have only entered into modest transactions for this several factors, such purpose in the current and previous year. as global economic trends, Brexit or other developments, * The Group monitors the overall impact of unhedged can impact the Group's exchange movements and provides guidance to revenues, margins, shareholders of the effect of exchange rate movements profits and cash flows. on a quarterly basis. ----------------------------- --------------------------------------------------------------
OPERATIONAL RISKS
LOSS OF DATA OR CYBER ATTACK
A cyber attack results in a system outage, impacting
core operations and/or results in a major data loss
leading to reputational damage and financial loss.
The Group's technology environment is critical to
success. A robust control environment helps decrease
the risks to core business operations and/or major
data loss.
Change from FY 2016/17: No change
-------------------------------------------------------------------------------------------------------------------
Link to strategy Actions taken by management
----------------------------------------------- ----------------------------------------------------------------
Having a resilient
technology landscape
is integral to delivering
our Operational Excellence
and Digital strategic
pillars.
----------------------------------------------- --------------------------------------------------------------
Risk TOLERANCE
-----------------------------------------------
Protecting the brand
and its reputation
globally is at the
heart of everything
we do. We have a low
tolerance and take
a risk averse approach,
adopting a strategy
to avoid or mitigate
any reputational/brand
risk.
-----------------------------------------------
Examples of risks
-----------------------------------------------
Denial of service * Established a cross--functional Cyber Security
resulting in disruption Steering Group with Executive membership and
of business activities. sponsorship.
An external hacker
exploits a security
vulnerability resulting * Continued investment in the cyber security programme
in a loss of system and completion of independent risk assessments to
control and/or major validate the strategy and identify capabilities
data loss. required to achieve the appropriate levels of
A malicious insider security.
abuses privileged
access to gain entry
to sensitive information * Cyber security status reporting through monthly
and/or conduct unauthorised scorecards reported to Executive and IT Management.
activities.
Malware results in
a loss of system control * Security Monitoring, which provides monitoring of the
causing business disruption network and computers 24/7, 365 days a year,
and/or major data supported by robust security incident response
loss. processes.
Fines due to failure
to prepare for the
General Data Protection * Creation of an Information Security Advisory function
Regulations (GDPR). to embed security in new projects and initiatives.
* Development of a Security Training and Awareness
campaign rolled out to employees.
* GDPR and Social Media Privacy Steering Group, a
cross--functional group that meets monthly to review
data controls around existing systems as well as
assess the potential data risks (from both a legal
and reputational perspective) associated with new IT,
Marketing, Retail and Digital initiatives across the
Group.
* Creation of the Data Protection office to monitor
internal processes and ensure policies are adhered to
in respect of the collection, security, storage,
retention and privacy of data.
----------------------------------------------- ----------------------------------------------------------------
Inability to attract, motivate, develop and retain
our people to perform to the best of their ability
in order to meet our strategic objectives.
Change from FY 2016/17: No change
-----------------------------------------------------------------------------------------------------------------
Link to strategy Actions taken by management
----------------------------------------------- --------------------------------------------------------------
Delivery of our strategy
relies on our ability
to ensure our people
continue to be driven
and inspired to deliver
outstanding results
for the Group. This
is done through fostering
a dynamic and inclusive
culture where all employees
feel engaged; empowering
and equipping our leaders;
strengthening capabilities
and expanding our talent
plans; simplifying
how we work; and driving
positive change and
a more sustainable
future across every
part of our Group's
footprint.
----------------------------------------------- --------------------------------------------------------------
Risk tolerance
-----------------------------------------------
We recognise the value
and importance of successfully
delivering our Inspired
People strategy and
therefore have a low
tolerance for risk
in this area.
-----------------------------------------------
Examples of risks
-----------------------------------------------
Failure to engage * Our Board and Audit Committee regularly review key
or equip our teams talent and resource risks.
to deliver our strategy,
or address key capability
gaps. * Global campaign, run by our leaders, to inform and
Failure to build the engage our people around the strategy and behaviours.
right capabilities
and behaviours in
our leadership population. * Codification and roll-out of aligned Burberry
Loss of critical talent/knowledge/unmanageable Behaviours, embedded in performance management and
levels of attrition incorporated into strategy campaign.
due to ongoing transition
period/change fatigue.
The long-term impact * A global employee engagement survey was carried out
of Brexit on the Group's this year with specific action plans now in progress
EU workforce is still to address the results. Focus on visible engagement
unknown. moments including Burberry Disrupted pilot and global
CEO Town Hall for strategy launch.
* Creation of, and execution against, capability maps
including new hires to address immediate priority
gaps.
* Introduction of simplified, more effective new
performance management process across the business.
* Roll out of Powerful Conversations training to
upskill line manager coaching capability and drive
performance.
* A new leadership development programme has been built
around Burberry Behaviours, to engage and equip
leaders - first intervention Summer 2018.
* Our Executive Team ensures there is a competitive
total reward offering, both financial and
non-financial, to retain our people and to attract
new hires.
----------------------------------------------- --------------------------------------------------------------
IT OPERATIONS
IT Operations fail to support critical processes
across the Company including Retail, Digital and
Group functions such as Supply Chain and Finance.
Change from FY 2016/17: No change
----------------------------------------------------------------------------------------------
Link to strategy Actions taken by management
---------------------------- --------------------------------------------------------------
All strategic pillars.
---------------------------- --------------------------------------------------------------
Risk TOLERANCE
----------------------------
In operating our business
and managing the possible
disruption to our IT
operations, we have
a low tolerance for
risk.
----------------------------
Examples of risks
----------------------------
Failure to provide * A strengthened team across the IT function has been
technology platforms put in place with clearer alignment of the IT teams
that meet customer to the strategy, the business functions and
demands and support operations.
innovation can result
in failure to deliver
the strategy and loss * Controls to maintain the continuity of the Group's IT
of revenue. systems are in place, including business continuity
Failure to provide and IT recovery plans which would be implemented in
stable and resilient the event of a major failure.
technology platforms
that meet business
demands can result * A tested Group incident management framework is in
in failure to deliver place to review, report and close high-impact events.
the strategy and negatively
impact operations
due to poor system * Programmes that will improve IT's ability to support
performance and/or operations are in place with a clear portfolio of IT
system outages. projects linked to the Company's strategic
objectives. Delivery of these projects is overseen by
our IT Portfolio Forum which regularly monitors
progress.
---------------------------- --------------------------------------------------------------
SUSTAINABILITY AND CLIMATE CHANGE
The success of our business over the long term will
depend on the social and environmental sustainability
of our operations, the resilience of our supply
chain and our ability to manage any potential climate
change impacts.
To address long-term sustainability challenges and
understand potential impacts of climate change on
our business, in both operational and financial
terms, an exercise is in progress, facilitated by
a third party, to explore future trends and climate
change scenarios and consider how they could affect
our business model. This exercise will inform the
development of cross-functional action plans to
help mitigate long-term risks and future-proof our
business.
Change from FY 2016/17: New
--------------------------------------------------------------------------------------------------
Link to strategy Actions taken by management
---------------------------- ------------------------------------------------------------------
Our commitment to being
an industry leader
in responsible, sustainable
luxury is embedded
in our Product and
Inspired People strategic
pillars. This underpins
and supports our strategic
focus to establish
ourselves firmly in
luxury fashion and
deliver sustainable,
long-term value.
---------------------------- ------------------------------------------------------------------
Risk TOLERANCE
----------------------------
We have a low tolerance
for risk when protecting
the human and environmental
resources we depend
on. However, given
the long-term nature
of some sustainability
risks and the significant
level of uncertainty
associated with their
occurrence and potential
impact, we accept that
some risks are inevitable.
We are therefore focused
on helping to minimise
global risks while
building resilience
in our operations and
supply chain.
----------------------------
Examples of risks
----------------------------
Resource scarcity, * Our Chief People, Strategy and Corporate Affairs
coupled with increasing Officer is responsible for ethical trading, community
demand, could affect investment and environmental sustainability matters
production, availability, and regularly reports on these topics to the
quality and cost of Management Risk Committee and the Board.
raw materials.
Increased frequency
of extreme weather * A new responsibility strategy was launched in June
events, from floods 2017, setting ambitious five-year goals: to drive
to droughts, could positive change through all products, to become
cause disruption in carbon neutral, to revalue waste, and to positively
our supply chain and impact one million people by 2022.
impact the sourcing
of raw materials,
as well as the production * Long-standing responsibility programmes are
and distribution of continuously reviewed and improved. Our Ethical
finished goods. Trading Programme focuses on ensuring labour and
Increased regulation human rights standards are met, while our new
and more stringent strategy takes us beyond compliance to enhance worker
environmental standards wellbeing and livelihoods in our supply chain. Our
could impact our business Energy & Water Reduction Programme continues to drive
by affecting production resource efficiency in our direct and indirect
costs and flexibility operations, while our new strategy includes a
of operations. commitment to switch to 100% renewable energy by
Our industry is sustained 2022.
by many agricultural
and manufacturing
communities around * Alternative, high quality and sustainable materials
the world. Failure are being continuously explored and used in our
to support them in product range. A new Burberry Foundation partnership
preserving key skills with the Royal College of Art focuses on driving
and building more innovation and creating more sustainable materials
sustainable livelihoods and processes for our industry.
could cause social,
economic and operational
challenges, ranging * As part of our new responsibility strategy for 2022,
from community tensions we aim to positively impact one million people in the
and disruption to communities sustaining our industry. To achieve this,
production, to a reduced we have supported the Burberry Foundation in setting
talent pool. up long-term community programmes with leading
organisations, focused on enhancing youth
employability, community cohesion and sustainable
farming.
---------------------------- ------------------------------------------------------------------
BUSINESS INTERRUPTION
A major incident at one of the Group's main locations, at its suppliers or affecting key products, which significantly interrupts the business. This could be caused by a wide range of events including natural catastrophe, fire, terrorism, or quality control failures. Change from FY 2016/17: This risk has increased due to the expansion at the Group's largest distribution centre. -------------------------------------------------------------------------------------------------- Link to strategy Actions taken by management ---------------------------- ------------------------------------------------------------------ Our Product and Distribution strategies enable us to operate effectively and efficiently, delivering Operational Excellence through continuity of supply of compliant products and services of the highest quality to our customers. Ensuring our ability to continually operate key sites and factories to develop, manufacture, distribute and sell our products is a key strategic priority. ---------------------------- ------------------------------------------------------------------ Risk TOLERANCE ---------------------------- We have a low tolerance for risk in this area, particularly in respect of product safety and quality. ---------------------------- Examples of risks ---------------------------- Burberry operates * We have policies and procedures designed to ensure two owned factories the health and safety of our employees and products and a global network and to deal with major incidents, including business of storage and distribution continuity and disaster recovery. hubs. These face typical property risks, such as fires, floods and * The Group continues to evolve its supply chain terrorism. organisational design to develop its manufacturing Burberry works with base, reducing dependence on key sites and vendors. several suppliers
of luxury goods who
would be difficult * A Group incident management framework is in place to
to replace quickly. ensure that incidents are reported and managed
Their loss could interrupt effectively. Across the Group, our Incident
core products or a Management Teams managed 34 incidents in the year.
seasonal range. Ten of these related to severe weather warnings,
A serious product including Hurricanes Harvey and Irma in the USA. Nine
quality issue could related to potential terrorist incidents in cities
result in a product where we have stores or employees and we moved
recall. quickly to ensure our customers, employees and assets
remained safe and secure. The remainder covered a
range of more minor issues including loss of
utilities. In addition, our Group Incident Management
Team took part in training and incident management
exercises involving large parts of the Group, our
customers, shareholders and media relations function.
Our plans as tested during the year were found to be
effective.
* Our product suppliers and vendors are subject to a
quality control programme which includes regular site
inspections and independent product testing.
* Robust security arrangements are in place across our
store network to protect people and products in case
of security incidents.
* Full business continuity plans are in place for our
ten main sites including the three major distribution
centres and our two factories. Business continuity
plans have been established and tested at Burberry
Business Services in Leeds. The Group's key IT
systems are protected to prevent and minimise any
potential interruption. This includes resilient
design and the provision of disaster recovery
services to continue operating within pre-agreed
times in case of a major incident. Our plans as
tested during the year were found to be effective.
* Management regularly review and manage business
continuity and disaster recovery risks recognising
that these plans cannot always ensure the
uninterrupted operation of the business, particularly
in the short term.
* A comprehensive insurance programme is in place to
offset the financial consequences of insured events,
including fire, flood, natural catastrophes and
product liabilities.
---------------------------- ------------------------------------------------------------------
COMPLIANCE RISKS
REGULATORY RISK & ETHICAL/ENVIRONMENTAL STANDARDS
The Group's operations are subject to a broad spectrum
of national and regional laws and regulations in
the various jurisdictions in which we operate.
These include product safety, trademarks, competition,
employee and customer health & safety, data, corporate
governance, employment and tax. Changes to laws
and regulations or a major compliance breach could
have a material impact on the business.
Change from FY 2016/17: This risk has increased
due to the increasing regulatory requirements in
the year, e.g. General Data Protection Regulations
(GDPR).
-------------------------------------------------------------------------------------------------
Link to strategy Actions taken by management
--------------------------- ------------------------------------------------------------------
Compliance with applicable
laws and regulations
and doing the right
thing underlie all
our strategic pillars.
--------------------------- ------------------------------------------------------------------
Risk TOLERANCE
---------------------------
In complying with laws
and regulations, including
customer, employee
safety and bribery
and corruption, we
have a low tolerance
for risk.
---------------------------
Examples of risks
---------------------------
Regulatory non-compliance. * The Group monitors and seeks to continuously improve
Failure by the Group processes to gain assurance that its licensees,
or associated third suppliers, franchisees, distributors and agents
parties to act in comply with the Group's contractual terms and
an ethical manner conditions, its ethical and business policies and
consistent with our relevant legislation.
code of conduct and
our responsibility
strategy, for example * Specialist teams at corporate and regional level,
with regard to model supported by third-party specialists where required,
wellbeing. are responsible for ensuring employees are aware of
Non-compliance with regulations relevant to their roles.
labour, human rights
and environmental
standards across our * Assurance processes are in place to monitor
own operations and compliance in a number of key risk areas, with
extended supply chain results being reported to our Ethics Committee,
would go against our Management Risk Committee and Audit Committee.
Responsible Business
Principles and could
result in financial * We have an established framework of policies that aim
penalties, disruption to drive best practice across our direct and indirect
in production and operations, including our Responsible Business
reputational damage Principles and Global Environmental Policy. Policies
to our business. are available at www.burberryplc.com, are owned by
Failure to prepare senior leadership, issued to all supply chain
for the GDPR. partners and implementation monitored on a regular
Tax is a complex area basis.
where laws and their
interpretations are
changing regularly * We have established a GDPR Steering Committee to
leading to the risk oversee compliance with GDPR legislation.
of unexpected tax
and financial loss
exposures. * International tax reform is a key focus of attention.
* Roll out of annual mandatory training to all
employees and to targeted functions to ensure
awareness and compliance with our policies governing
anti-bribery and anti-corruption (ABAC), insider
dealing, annual conflict declarations, including,
anti-bribery and anti-corruption training, insider
dealing, annual conflict declarations, criminal
finances, anti-money laundering and privacy.
* Our culture and policies encourage employees to speak
up and report any issues without fear of retribution.
A global confidential employee helpline is in place
in substantially all countries where we have retail
and corporate locations, and where it is legally
permitted. All calls and emails are logged and
independently reviewed and followed up. During the
year 110 cases were received and the results and
themes are reviewed at the Ethics Committee. No
significant issues were identified from these cases
during the year.
* In accordance with our ABAC policy, annual training
is required to be performed. This year the annual
e-learning module was rolled out to all corporate
staff and manufacturing and retail employees of
manager level and above, a total of 2,978 employees.
The training reached a 99% completion rate. Any
incidents or potential areas of concern are
investigated by highly experienced investigators in
our Asset Profit and Protection team and ABAC risks
are covered as part of the scope of Internal Audit
reviews. During the year there were no material ABAC
related issues.
--------------------------- ------------------------------------------------------------------
INTELLECTUAL PROPERTY
Sustained breaches of Burberry's intellectual property
(IP) rights or allegations of infringement by Burberry.
Counterfeiting, copyright, trademark and design
infringement in the marketplace can reduce the demand
for genuine Burberry merchandise.
Change from FY 2016/17: No change
-------------------------------------------------------------------------------------------------
Link to strategy Actions taken by management
--------------------------- ------------------------------------------------------------------
Protecting the integrity
of the brand, safeguarding
and elevating its luxury
position, complying
with applicable laws
and regulations, and
doing the right thing
underlie all our strategic
pillars.
--------------------------- ------------------------------------------------------------------
Risk tolerance
---------------------------
We have a low tolerance
for risk in protecting
the integrity of the
brand, asserting our
IP rights and minimising
parallel trade while
ensuring due respect
is given to the IP
rights of others.
---------------------------
Examples of risks
---------------------------
Counterfeiting, parallel * The Group's global Brand Protection team is
trade, copyright, responsible for the Group's brand protection efforts
trademark and design globally, including in the digital environment. Where
infringement in the infringements are identified these are addressed
marketplace can reduce through a mixture of criminal and civil legal action
the demand for genuine and negotiated settlements.
Burberry merchandise
and impact on revenues.
Unauthorised use of * IP rights are driven largely by national laws which
trademarks and other afford varying degrees of protection and enforcement
IP, as well as the priorities depending on the country.
unauthorised sale
of Burberry products
and distribution of * Trademark registrations globally across all
counterfeit products, appropriate categories.
damages the Burberry
brand image and profits.
Allegations from third * The Brand Protection team partners closely with the
parties of IP infringement design and merchandising teams to ensure that our
by Burberry could products do not infringe the rights of third parties.
result in significant
damages claims, financial
loss through withdrawing * Exploring new and emerging threats and ways to combat
infringing products threats.
and negatively impact
Burberry's reputation.
* Inspiring Burberry associates and partners to engage
with us in protecting our brand.
* Partnering with enforcement agencies and our digital
partners to minimise the visibility of counterfeit
and parallel trade products both online and offline.
* Disrupting the flow of counterfeit products by
enforcing to source level.
--------------------------- ------------------------------------------------------------------
EXTERNAL RISKS
MACRO--ECONOMIC AND POLITICAL INSTABILITY
The Group operates in a wide range of markets and is exposed to changing economic, regulatory, social and political developments that may impact consumer demand, disrupt operations and impact profitability. Adverse macro--economic conditions or country-specific changes to the operating or regulatory environment or civil unrest may impact spending habits of key consumer groups such as the Chinese consumer and cause increased operational costs. Change from FY 2016/17: No change ------------------------------------------------------------------------------------------------- Link to strategy Actions taken by management ---------------------------- ----------------------------------------------------------------- Volatility in the external environment may impact our overall financial performance and operations. ---------------------------- ----------------------------------------------------------------- Risk tolerance ---------------------------- We have a low to moderate tolerance for risk in this area but recognise external factors are difficult to mitigate as they are often outside our control. ---------------------------- Examples of risks ---------------------------- The strategy does not address the changes created by macro--economic trends and uncertainty * Our global reach helps to mitigate reliance on in the outlook for particular consumer groups. We continue to focus on the luxury sector engaging with the Chinese luxury consumer, both in globally or within China and while travelling abroad. In addition, our significant consumer brand has wide appeal across multiple consumer groups, e.g. Chinese segments, including a broad set of ages and consumers. preferences. Increased political instability and tension caused by the situation * The risk associated with North Korea is outside our in North Korea may control. Korea is a key region for the overall cause increased operational business and the situation is being monitored by the costs. Group Incident Management Team. ---------------------------- -----------------------------------------------------------------
BREXIT
Various Brexit scenarios could impact the Group's financial position, supply chain and people. Change from FY 2016/17: New ---------------------------------------------------------------------------------------------- Link to strategy Actions taken by management -------------------------- ---------------------------------------------------------------- Volatility caused by Brexit uncertainty may impact our overall financial performance. -------------------------- ---------------------------------------------------------------- Risk tolerance -------------------------- Although we have a low tolerance for risk caused by Brexit there is still uncertainty about the long--term impact. -------------------------- Examples of risks -------------------------- Additional customs duty from the cessation of existing free trade * A transitional arrangement potentially offers some agreements and VAT temporary relief to December 2020 and, assuming cash flow costs at agreement, should provide 18 months' more time for the new UK trade border. mitigation planning and implementation. Impact on some current business roadmaps. Extended supply lead * Our Brexit Steering Committee continually monitors times increasing working the evolving impact of Brexit and oversees our capital. response. Uncertainty over the rights of EU nationals which has increased * AEO accreditation would mitigate supply chain risks the risk of losing and continues to be pursued. talent. Exchange and interest rate volatility impacting Group revenues, * Engagement with UK government departments to ensure margins, profits and they are fully informed of our circumstances and cash flow. concerns, through appropriate representation. -------------------------- ----------------------------------------------------------------
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
ACSUNVWRWAANRRR
(END) Dow Jones Newswires
June 06, 2018 04:53 ET (08:53 GMT)
1 Year Burberry Chart |
1 Month Burberry Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
