Mike Ashley's Frasers Group has revised its financial outlook downwards, attributing the change to tougher trading conditions following October's Budget. The retailer now anticipates an adjusted pretax profit ranging between £550m and £600m for the 2025 financial year, a decrease from the previously forecasted £575m to £625m.
"Both ahead of and after the recent Budget, consumer confidence has weakened and recent trading conditions have been tougher," the company stated in its half-year results, as reported by .
Looking ahead to 2026, Frasers foresees incurring additional costs of at least £50m due to the Chancellor's decision to raise employers' national insurance and increase the minimum wage as announced in the Budget. The firm is actively seeking ways to "working hard to mitigate" these impending costs.
In early trading, shares in Frasers Group dropped by over 13%.
This guidance was issued alongside the company's report of a one-third decline in pretax profit for the six months ending in October, which fell to £207m.
Frasers attributed its trading performance to a reduction in foreign exchange gains and fluctuations in equity derivatives. On an adjusted basis, pretax profit slightly decreased by 1.5% to £299m, down from £304m in the previous year.
Despite continued sales growth in Sports Direct, this was overshadowed by "planned declines" in other areas such as Game º£½ÇÊÓƵ, Studio Retail, and Sportmaster in Denmark. Frasers is currently engaged in "right-sizing" these previously unprofitable businesses to ensure their long-term sustainability.
Additionally, the group cited a "challenging luxury market" as a factor negatively impacting sales.
"The first half of this year has been another period of progress for the Group, delivering on our objectives as the Elevation Strategy continues to take the business to the next level," said Michael Murray, chief executive of Frasers. "We continue to operate with discipline to ensure our business is as resilient as possible – proactively right-sizing recent acquisitions to set them up for profitable long-term growth and driving further automation benefits to exceed our stock reduction targets for the period."
