Frasers Group plc has reported an increase in half-year revenues but falling profits.
Mike Ashley’s listed retail group reiterated its full-year profit guidance of £550 million to £600m despite a “challenging consumer environment”.
Describing performance in the 26 weeks ended 26th October 2025 as “a solid first half”, it added: “Although trading has improved compared to last year’s Budget-affected period, it is still weaker than FY24, with excess inventory in the sector continuing to weigh on the wider market.”
It blamed the Labour government for imposing increased costs on the retail sector.
Frasers said a 5% increase in revenue for the half-year period to £2.58 billion was driven by international revenue growth of 42.8% as well as the performance of Sports Direct and strengthening margins in its premium & luxury division, particularly at Flannels.
Trading profits for H126 were up 11.6% to £447.9m. However operating profit was down 18.2% to £219.8m – partly due to share-based payments of £11.2m – while overall adjusted profit before tax was down 2.8% to £290.9m.
In the period Frasersc disposed of Coventry Arena for £50m, generating a £33.8m gain. Net assets increased to £2.4bn from just under £2bn at FY25.
Its Frasers Plus offer now has 1.1m active members – up from 400,000 at the end of FY25 – and accounted for 20% of online sales. £154m of retail sales were made on credit in the half-year.
The group exited StudioPay and completed the acquisitions of Holdsport in South Africa and XXL in the Nordics in the period. It also recently opened its first stores with partners in Malta, Australia and the Middle East.
In July 2025 it secured a new £3bn financing facility, replacing the previous £1.65bn arrangements, with the option of increasing the facility by a further £500m. The facility currently stands at £3.1bn.
“We’ve made a solid start to FY26 even though market conditions are tough, consumer confidence is very subdued and excess inventory continues to weigh on the industry, leading to increased promotional activity,” said CEO Michael Murray.
“While we remain cautious into the second half, our focus is unwavering as we confront these challenges head-on, and we are today re-iterating our FY26 APBT guidance of £550m to £600m.
“We are continuing to invest boldly in our Elevation Strategy-deepening brand partnerships, elevating our product mix, opening new Sports Direct stores internationally, and acquiring strategic properties to strengthen our portfolio. These steps reinforce our ambition and give us real confidence in the substantial long-term opportunities ahead for the group.”
In a swipe at the UK Government and unions, the firm added: “As noted in our letter to the Unite Union General Secretary Sharon Graham on 3rd October 2025, given the significant cost increases imposed on retail by the Labour government, it would be reckless and irresponsible for Unite to implement a strike whilst demanding further above inflation wage increases.
“We await the Union’s response to our latest communication following a breakdown in talks and urge them not to repeat their previous politically motivated actions against the group.”