Bringing joy to
everyday cooking
Annual Report and Accounts 2023
Group plc Annual Report and Accounts 2023
Developing
our customer
proposition
page 14
Building on
our strong
foundations
page 17
At a glance
Equipping everyone with the tools
to bring joy to everyday cooking
ProCook is the UK’s leading direct-to-consumer
specialist kitchenware brand, designing,
developing, and retailing a high-quality range
of kitchenware which provides customers with
significant value for money.
Our mission
To be the customers’ first
choice for kitchenware
In the 27 years since we first founded ProCook our focus on
product quality, value and service have served as the key pillars
of our customer offer, and I’m pleased that this year we have again
increased our active customer base, added three more retail
stores and upsized two more, and retained our excellent-rated
Trustpilot score. Our value for money offer has enabled us to retain
a resilient trading performance despite the many headwinds.
This year the economic backdrop has been one of the toughest
I’ve experienced in my career. Our customers and colleagues
have felt the squeeze on disposable incomes as inflation
has soared upwards. We have faced challenging trading
conditions before, and emerged stronger, more nimble, and
more determined to press ahead on our mission to become the
customers’ first choice for kitchenware.
Our team have worked incredibly hard this year as we have faced
into these challenges. We have continued to invest in the areas
that will support our long-term growth and performance, most
notably in our new Distribution Centre and HQ in Gloucester,
while taking difficult decisions to manage costs, preserve cash
and improve our focus on our core business in the UK.
We have spent time working on developing our culture, and our
brand purpose, which together will act as a North Star for all of our
future activities, and enable us to more effectively communicate
our specialist proposition to customers, equipping everyone
with the tools to bring joy to everyday cooking.
This year our focus on always doing the right thing has been
exemplified in our certification as a B Corp. We have much more
that we must do as a sustainable and responsible business, to
protect our planet and give more back to our communities, but I
am pleased that we are leading the way on these important issues.”
Daniel O’Neill
CEO & Founder
“
Attracting
more
customers
to our brand
page 10
Sustainability
page 30
Designer outlet
centres
Garden centres
Destination retail
ead office
Group overview
1
Yo2Y LFL for FY22, pre-pandemic comparative
2
This report contains Alternative Performance
Measures which may not be defined in
accordance with Statutory measures.
See page 164 for further information.
Revenue
£ F
£69.2m FY22
Free cash flow
APM
£ F
£ FY22
Number of retail stores
F
55 FY22
Yo3Y LFL Revenue %
1
APM
F
123.5% FY22
Number of new
stoers
F
723 FY22
Colleagues employed at reporting date
F
684 FY22
Gross profit margin %
APM
F
65.1% FY22
Number of active customers
teastots
F
974 FY22
Underlying PBT
APM
£F
£9.5m FY22
Trustpilot score
F
4.8 FY22
Strategic Report
02 Chairman’s introduction
04 Business model
06 CEO’s review
10 Attracting more customers
to our brand
14 Developing our customer
proposition
17 Building on our strong
foundations
18 Creating an even better place
to work
20 Reducing our environmental
footprint
22 Engaging with stakeholders
30 Sustainability
51 Non-financial information and
sustainability statement
52 Key performance indicators
54 CFO’s review
58 Risk management
60 Principal risks and uncertainties
72 Viability assessment
Governance Report
74 Chairman’s governance letter
76 Governance framework
78 Board of Directors
80 Division of Directors’
responsibilities
82 Board activities
86 Nomination Committee Report
89 Audit and Risk Committee
Report
92 Remuneration Committee
Report
94 Directors’ Remuneration policy
102 Annual Report on Remuneration
108 Directors’ Report
113 Statement of Directors’
Responsibilities
Financial Statements
114 Independent auditor’s report
122 Consolidated financial
statements
126 Consolidated financial
statements accounting
policies
137 Notes to the consolidated
financial statements
156 Parent company financial
statements
158 Parent company financial
statements accounting
policies
161 Notes to the parent company
financial statements
164 Alternative Performance
Measures (APMs)
167 Contacts and Advisors
Visit our website at: www.procookgroup.co.uk
Operational overview
We operate from our distribution
centre and headquarters located
in Gloucester which is home to our
logistics, customer services and all
central supportfunctions.
We currently have 58 inspirational
retail stores spread geographically
throughout the UK located in
leisure-based centres.
These stores offer customers
convenience, the opportunity to
test products, and helpful service
from knowledgeable colleagues.
Customers can also shop online for
home delivery atwww.procook.co.uk
Our ProCook Cookery School
is located above our store
on Tottenham Court Road in
centralondon.
APM
01Group plc Annual Report and Accounts 2023
Chairman’s introduction
In a year which has been challenging
for many reasons, not least the impact
of inflation on the cost of living for our
customers and our colleagues, I am
pleased that ProCook has delivered
a resilient trading performance. We
broadly maintained market share in the
UK, while making significant progress
on strategic priorities which will support
the development of the brand in the
years ahead.
The year has been a pivotal one for a
number of reasons. We completed
the transition away from unprofitable
Amazon channels, reducing revenue
by 4.9% year on year, in order to focus
fully on attracting customers to shop
directly with the brand. Additionally,
the opening of our new Distribution
Centre and HQ has been a key strategic
achievement, which paves the way for
improved operational efficiency in the
years ahead and provides capacity for
continued growth.
We have relaunched our brand purpose
and Company values, based on the
ethos and principles of the business
which was first established in the late
1990’s by the O’Neill family. Equipping
everyone with the tools to bring joy to
everyday cooking clearly articulates
why we do what we do. This will guide
all of our activities and help us focus
our efforts as we move forward to
become the customers’ first choice
forkitchenware.
The significant inflationary and cost
of living pressures have presented
challenges for our business, as well
as for our customers, colleagues,
and suppliers, and is evident in our
gross margins following the impact
of heightened shipping costs post
Covid-19. However, we are confident
in our strategy, our business model,
and our proposition. We have the
right plans and foundations to deliver
sustainable, profitable growth over
the medium to longer term and we are
focused on developing our business to
be stronger and even more appealing
to customers.
I would like to thank all of the ProCook
team, suppliers, and partners on behalf
of the Board for their resilience in the
face of difficult conditions and in their
efforts to continually improve our
proposition and serve our customers
with such commitment.
Governance and CEO
succession planning
We are committed to the highest
standards of corporate governance,
and I am pleased to report that the
Board considers that it has complied in
full with the UK Corporate Governance
Code’s principles and provisions during
the year.
The Non-Executive Directors continue
to work very well with the Executive
Directors and wider Leadership Team,
providing highly relevant sector
experience and skills with pragmatic
knowledge-sharing and support,
and healthy challenge on strategic,
operational and governance matters.
During the year, we have reduced the
size of the Board to five members,
following the retirement in Spring
2023 of Steve Sanders, who has been
instrumental to ProCook’s growth and
success over the last seven years, and
as Gillian Davies stepped down from
the Board at the same time as Steve
in December 2022. I would like to
reiterate my thanks, on behalf of the
Board, to both Steve and Gillian for
their contributions to the Board during
their tenure.
Daniel O’Neill has indicated his
intention to step back from the CEO
role at an appropriate point. Daniel has
discussed the timing of this with the
Nominations Committee and it was
agreed that the business had reached
a stage where he could begin thinking
about making this transition. Having
founded ProCook over twenty years
ago, Daniel has deep knowledge of
the business, and it is his intention to
continue to add value by supporting
the product development team on a
part-time basis.
We have a renewed focus in our purpose
to equip everyone with the tools to bring
joy to everyday cooking, this guides all
of our activities and helps us focus our
efforts as we move forward to become the
customers’ first choice for kitchenware”
Greg Hodder
Chairman
Group plc Annual Report and Accounts 202302
Strategic Report
The Board has therefore commenced
a search process to ensure effective
succession planning and in the
meantime, Daniel will remain in the role,
until a suitable successor is appointed,
and an orderly handover iscomplete.
Sustainability
The Group’s new values highlight
ProCook’s commitment to always
doing the right thing, and that
is exemplified by the successful
achievement of the B Corp certification
during the year, with ProCook
becoming the first UK listed retailer
to achieve this award. This reflects
the Group’s long-held commitment
to building a responsible brand with
a strong purpose; having already
celebrated many milestones including
eliminating and mitigating Scope 1 and
2 emissions, committing to the real
Living Wage, and being recognised as
one of the UK’s Best Workplaces
TM
.
The Group reported carbon neutral
status for Scope 1 and 2 emissions last
year, and since then the Leadership
Team have completed the work to
understand and measure Scope 3
emissions and have begun to develop
strategies to eliminate and mitigate
them over the years ahead. This is a
critical task, necessary to help protect
our planet for future generations, but
we recognise it is challenging given
the nature of global supply chains and
is not something that can be solved
in the immediate term. It will instead
be achieved through continually
caring for our community and planet,
and I am pleased to see plentiful
evidence of this in both the day-to-
day operational decision-making, and
broader strategic decisions that the
Grouptakes.
Daniel O’Neill, in his report on pages
6 to 9 sets out more detail about this
important topic, and the next steps we
will take are set out in further detail on
pages 20 to 21 and in our sustainability
report on pages 30 to 50.
Dividend
With the wider macro-economic
uncertainty in mind, and therefore
taking a cautious and responsible
decision to preserve cash within the
business during these times, the board
is not recommending a dividend
payment for this financial year. The
Board will continue to review dividend
payments in future periods in line with
the Group’s capital allocation policy.
Outlook
The outlook remains challenging and
much is uncertain. While there are
indications that inflationary pressures
will ease over the months ahead, UK
consumers have suffered a significant
adverse impact on disposable incomes
and discretionary spending power.
Despite this, we see clear opportunities
ahead of us to attract more customers
to the ProCook brand and grow our
market share, by building a better
business through developing our
products, service and operating
model, thereby emerging stronger
from this challenging period.
Greg Hodder
Chairman
27 June 2023
Malmo
tableware range
Group plc Annual Report and Accounts 2023 03
Strategic Report
Our business model
Cookery
School
Technology
Data
Websites
Customer Services
Retail Stores
Logistics
Supply Chain
Products
Always do the
right thing
Obsessed
with quality
Focused
on value
Create a great
place to work
Care for our
communities
and planet
Build a better
business
Bringing joy
to everyday
cooking
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By cutting out the middlemen we
create greater value for our customers,
and generate sector-leading margins
for ProCook, allowing us to reinvest for
future growth.
We design and direct source our
products ourselves, and by operating
our own routes to market, we deliver
better quality products and better
service for customers at lower prices.
Through this direct-to-consumer
approach, we target savings for our
customers of at least 30% against
comparable products from competitor
brands. Our customers benefit from
great advice in our retail stores,
along with the ability to trial and test
products, and our easy-to-use website
offers a range of convenient delivery
options to customers.
Our customers
We completed over 1.8 million
customer transactions in the last year,
the vast majority being to customers
across the UK. Our customer base
is 81% female, with a higher than
average level of affluence. We have
almost 4 million customers on our
database, and, with a market share
of just under 2%, we have significant
opportunity to raise awareness of our
brand in the years ahead, equipping
everyone with the tools to bring joy to
everydaycooking.
Number of active customers
in last twelve months
04 Group plc Annual Report and Accounts 2023
Business model
Elite Tri Ply
cookware range
Our products
We are obsessed with quality and
value. Our products are designed,
sourced, and refined by our in-
house design and purchasing teams,
who focus on exceptional quality,
functionality, durability, sustainability,
and style to ensure our customers can
enjoy using them in everyday cooking
for many years. We launch new
products throughout the year, typically
refreshing our range by approximately
25% each year.
Many of our supplier relationships are
long established, and we’re committed
to working in a transparent and fair
way. With our focus on manufacturing
standards and responsible sourcing,
we are supporting our supplier
partners to achieve higher standards
for their own people, communities, and
the planet we all live in.
Our colleagues
As a certified Great Place to Work
TM
company, we are committed to
treating our people well. We employ
over 600 colleagues across our
stores, headquarters, logistics and
customer service operations. Our
culture reflects our family heritage, and
our teams are agile, collaborative, and
passionate in delivering extraordinary
customerservice.
Our channels
Retail
Our 58 retail stores are
geographically spread throughout
the UK and provide customers
a convenient and inspirational
shopping experience, with the
opportunity to seek advice from our
knowledgeable colleagues and to
trial products in store.
Ecommerce
Our proprietary websites are
designed to be easy to use and
inspirational, with convenient home
delivery and payment options
for customers. We merchandise
products using high-quality imagery
and video content produced in our
photography studio and our Cookery
School to inspire our customers.
Cookery School
Our Cookery School in Central
London offers customers the
opportunity to enjoy developing their
own cooking skills in a relaxed setting
with a broad range of specialist
courses and events. Our chef-tutors
are experts in their respective fields
and create fun and memorable
experience for our guests.
Our data and technology
Our proprietary technology and
comprehensive customer database
supports our day-to-day operations
and strategic decision-making
and provides a strong platform for
continued growth. Our operating
systems and website channels are
continually developed by our own
Technology team, allowing us to
deliver customer and operating
enhancements rapidly. We use
best-in-class third-party tools
to augment our own platforms
whereappropriate.
Our logistics and
etraoeratos
Our headquarters in Gloucester is
home to our logistics and central
operations functions including
our customer service team which
collectively support our customers
before, during and after their
shopping experience, and lead
the continual development of
ourproposition.
Group plc Annual Report and Accounts 2023 05
Strategic Report
CEO’s review
Bringing joy to
everyday cooking
This year the economic backdrop
has been one of the toughest I’ve
experienced in the 27 years since we
founded the business. Our customers
and colleagues have felt the squeeze
on disposable incomes as inflation has
soared upwards.
As a specialist kitchenware brand, our
value for money offer has enabled us to
retain a resilient trading performance
despite the many headwinds. We have
faced challenging trading conditions
before, and emerged stronger, more
nimble, and more determined to press
ahead with our mission to become
the customers’ first choice for
kitchenware.
Our team have worked incredibly hard
this year as we have faced into these
challenges. We have continued to
invest in the areas that will support our
long-term growth and performance,
most notably in our new Distribution
Centre and HQ in Gloucester, while
taking difficult decisions to manage
costs, preserve cash, and improve
our focus on our core business in
the UK, resulting in the exit of our
EUoperations.
We have spent time this year
developing our people and culture,
and our new brand purpose; equipping
everyone with the tools to bring joy
to everyday cooking. This purpose
accompanied by our new Company
values which reflect the principles
upon which we have always worked,
together provide a North Star for our
futureactivities.
Challenging trading
conditions
The significant pressures on
consumers’ disposable income, due to
the high inflation macro-environment,
have led to very difficult trading
conditions in FY23. Our total revenue
of £62.3m was 9.9% lower year on year,
in part due to the decisions we took to
exit unprofitable Amazon Marketplace
channels including in the EU, which
reduced revenue by 4.9%. Sales in our
core UK business were down 5.0% year
on year, yet still up 112.2% on a like-for-
like basis (“LFL”) compared to pre-
pandemic (FY20), and we broadly held
our share of the UK kitchenware market
year on year despite a significant shift
away from online sales (a channel
which we over-index in) as consumers
returned to physical retail shopping.
Cost inflation impacted our gross
margins, particularly the post-
pandemic heightened shipping
costs and the adverse movement in
foreign exchange rates, and these
impacts were only partly offset by
price increases. As a result, our gross
profit margins declined by 3.6% points
year on year to 61.5%. While we are
seeing some easing of these gross
margin impacts, other inflationary cost
pressures, including wages, energy and
fuel costs remain high in the current
financial year.
We have made difficult choices to
manage and right-size our cost base
during the year. We have implemented
a plan to deliver £3.0m of annualised
cost savings, which we expect to
realise the benefits of in the current
financial year andbeyond.
Underlying profit before tax reduced to
a loss of £0.2m in the year (FY22: £9.5m
profit), and after non-underlying items
including impairment charges, we
reported aloss before ta of 6.m.
We maintained a strong focus on cash
management with tight discipline of
working capital, while investing in the
areas that will continue to drive our
business forward including three new
stores openings, two upsized store
relocations, and our new Distribution
Centre and HQ. Free cash flow improved
by £2.5m year on year to an outflow of
0.m F22: outflow of3.0m.
In this difficult market, we have made
strong progress with our strategic priorities
which will provide the foundations for
future profitable growth over the years
ahead.”
Daniel O’Neill
CEO and Founder
Group plc Annual Report and Accounts 202306
1
ttratore
customers to our brand
In a recent survey that we
commissioned with YouGov,
spontaneous awareness of ProCook
was just 7% of the UK population,
with prompted awareness at 33%.
Combined with our relatively low
kitchenware market share, which we
estimate is approximately 2%, this
provides a significant opportunity
to grow our customer base over the
medium term.
During the last year we attracted a
further 692,000 new customers to
shop with us (FY22: 723,000) and
increased our active customer base
to 991,000 (FY22: 974,000). Our
12 month repeat rate decreased
by 1.9% points year on year to
23.6%, largely reflecting the market-
driven channel shift back towards
Retail which has historically had
a lower repeat frequency. Retail
repeat rates increased year on year,
while Ecommerce repeat rates
slowedslightly.
We have invested in and implemented
a new CRM platform. This will provide
us greater opportunity to increase
loyalty and advocacy through
improved segmentation, greater
personalisation, and a broadening
of our communications across
more customer channels including
socialmedia.
We cautiously reduced our brand
marketing spend in the year while
we revisited our brand purpose,
which, now refreshed, will provide
improved clarity to our future
marketingmessaging.
2
eeoor
customer proposition
During the year we made the
considered decision to discontinue our
operations on Amazon marketplace
channels, including in the EU, in order to
focus more fully on our UK market and
our own direct consumer proposition.
These channels historically provided
a lower contribution than our core
business, and added complexity to our
business model, which we are pleased
to have eliminated.
While performance in our own
Ecommerce website has been
difficult, with LFL sales declining by
11.0% largely driven by changing
customer shopping preferences
between channels, exacerbated by the
Royal Mail strikes during December,
we have made positive progress
in developing our capabilities. We
completed a technical re-platform of
our website in the first half of the year,
improving the code base which has
made subsequent developments far
quicker and has improved site speed.
We have enhanced our delivery offer
for customers to include a named
day and a cheaper 2-3 day service,
improved product range navigation,
and experimented with a wide range of
smaller changes. During the latter part
of the year, we initiated a programme
of work to overhaul the design and
user experience on our website which
is progressing well, and we plan to test
and launch this to customers during
thesummer.
We have increased our Retail estate
to 58 stores, adding three new stores
in destination retail locations, and
completing upsize relocations for
two existing stores during the year.
Early performance in these new stores
has been strong and we expect a
combined payback on investment
of less than one year. Wehave also
worked hard to improve retail service
in existing stores, and through
continued investment in training and
development, we have improved
conversion rates and average
transaction values which had been
impacted by the macro-environment.
In the latter part of the year, supported
by external expertise, we developed
our understanding of the potential
for retail estate expansion in the UK,
increasing our expectation of how
many stores we can open in the UK
and providing a list of target location
opportunities to consider further.
While we will pursue these newly
identified locations with appropriate
caution in this rapidly changing retail
environment, we are excited by the
opportunities ahead of us to extend
our customer reach and firmly believe
that bricks and mortar retailing is a key
component of our proposition.
Damascus 67
knives range
Group plc Annual Report and Accounts 2023 07
Strategic Report
CEO’s review
Continued
We were pleased to have been
recognised by Which? as a
Recommended Provider, ranking 4th
amongst a large peer group based
on customer feedback, noting in
particular our product quality and
range. Our continued focus on product
development has resulted in the launch
of 154 new products in the year with
a range refresh rate of 20%. We have
been cautious in our pricing, carefully
monitoring the impact of increases we
have had to make in response to cost
pressures and retaining our relative
value advantage.
We have identified a new
manufacturing partner and worked
together to design the first phase of
our range of small kitchen electricals
during the year, ready for launch
in H1 FY24. We are excited by the
potential opportunity that this new
complementary category brings in
creating another reason to shop with
ProCook, extending our total market
size by a quarter, and enabling us
to attract a new group of in-market
customers to our brand.
3
door
strong foundations
A key strategic priority for us this
last year has been the development
of our new distribution centre and
headquarters in Gloucester which we
began to transition into during February
2023. This new facility provides
significant capacity for growth and
will allow us to achieve efficiencies
in our logistics operations, as well as
providing a more collaborative and
inspirational workplace for our office-
based colleagues. We are focused
on completing the transition and
realising the efficiencies that this new
siteprovides.
We have continued to develop our
technology capabilities, and our
team have successfully delivered a
comprehensive roadmap of initiatives
this year, building on our core bespoke
platforms. Their focus has been to
support customer experience and
revenue growth initiatives, operational
efficiencies, and reduce risk through
a range of infrastructure and cyber
security improvements.
4
reataeeetter
place to work
We are committed to continually
making ProCook an even better
place to work. We recognise that
the last year has been challenging
for our colleagues, and while it is
disappointing to see our engagement
score drop year over year, we welcome
the opportunity to receive feedback
and to identify more ways to support
our team. During the year we launched
our Colleague Advisory Panel and
regular monthly Town Hall meetings,
improved our benefits and total reward
package (including our response to the
cost of living crisis), and reiterated our
commitment to the Real Living Wage
Foundation.
We were pleased to be recognised
again as a Great Place to Work
TM
for
the second year running and for two
categories, Women and Wellbeing, to
have finished inside the top tier as well
as being ranked amongst the UK’s Best
Places to Work.
5
edor
environmental footprint
In October 2022, we were certified as a
B Corp following a rigorous assessment
and enormous team effort across our
business. There are very few publicly
listed brands certified as B Corps
and so we are incredibly proud to be
trailblazing in our sector. Alongside our
sustainability goals, B Corp provides a
stringent framework against which we
can measure ourselves.
Now that we have completed our full
carbon footprint analysis including
our Scope 1, 2 and 3 emissions, we
have gained a fuller understanding of
the extent of the emissions implicit in
our indirect sourcing activities. These
are significant in comparison to the
relatively modest emissions from
our own operations which we have
worked hard to reduce or eliminate
over recent years. As a result of the
emissions in our supply chain not being
directly in our control and being in
sectors and countries where no clear
de-carbonisation plans exist yet, we
are undertaking a detailed exercise to
reassess the timescales on which we
can commit to net zero with confidence
across our value chain as a whole and
Further information about our strategic priorities is set out in the following sections:
Read more:
Attracting more
customers to our brand
- page 10
Read more:
Reducing our
environmental footprint
- page 20
Read more:
Developing our
customer proposition
- page 14
Read more:
Building on our strong
foundations
- page 17
Read more:
Creating an even better
place to work
- page 18
Group plc Annual Report and Accounts 202308
in the meantime, we have set out eight
initial priorities to progress in the next
twelve months. We believe in honouring
our responsibilities to people and the
planet alongside our commercial goals,
and we are committed to making as
much progress as we possibly can with
our suppliers and partners to reduce
our environmental impact.
Emerging stronger than ever
I am pleased with the strong
strategic progress we have made
this year, despite the challenging
economic backdrop. We have faced
challenging conditions before in our
27-year history, and by focusing on our
customers and improving our business
model for the long term, we have
always emerged stronger.
In opening our new distribution centre,
simplifying our operations to focus
on the UK, improving our customers’
in-store and online experience,
and becoming a B Corp, while also
extending and improving our product
ranges, we have made significant steps
forward. We know that our proposition
continues to resonate very well with
customers, and with our progress
this year, we have built a better
business, paving the way for improved
performance and profitable growth in
the years ahead.
Daniel O’Neill
CEO and Founder
27 June 2023
Stockholm
stoneware range
Group plc Annual Report and Accounts 2023 09
Strategic Report
Customer awareness of ProCook
remains relatively low, providing
a significant opportunity for the
continued growth and development of
our brand.
In our most recent research survey of
UK customers, spontaneous awareness
of ProCook was just 7%, while
prompted awareness was also low at
33%, both well below our competitor
peer group. Of the population that is
aware of our offer, consideration to
purchase is healthy at 44% and the
conversion to purchase rate is strong at
29% compared to our peer group.
1
Our brand and proposition are
therefore a “best kept secret”;
customers who know of us, buy from
us, and with our strong service and
quality offer at great value we have
received over 85,000 5-star ratings on
Trustpilot giving us an excellent rating.
These customers go on to repeat
purchase with us, with approximately
a third coming back to shop with us
again in the following 24 months after
initialpurchase.
Growing awareness of our brand and
our offer is a key lever to drive continued
growth and performance. In our newly
refined purpose, we have identified our
North Star which will provide a consistent
guide to all of our activities across
ProCook as we equip everyone with the
tools to bring joy to everyday cooking.”
Angela Porter
Chief Marketing Officer
1
YouGov Survey, 4000 participants, January
2023. Peer group reflects the combined
average results of Tefal and Le Creuset
Our first strategic objective is therefore to attract more customers to our brand,
and we plan to do this by:
#1
Raising brand awareness with an effective media plan
#2
Turning new customers into brand loyalists and advocates
Awareness to purchase funnel
1
Purchased
Consideration
Promoted
awareness
Spontaneous
awareness
19%
48%
29%
75%33%
44%
29%
7%
ProCook Peers
Group plc Annual Report and Accounts 202310
Attracting more customers to our brand
Developing our brand purpose
During the last year we have revisited
our brand purpose and proposition,
developing a North Star and a
coherent framework that defines
why we exist, bringing meaning to
our operational activities and clear
guiderails to support our decision-
making, ensuring that our customer
and our purpose are at the heart of
all we do.
We are obsessed about our product
quality and the better value we
offer customers by cutting out
the middleman. Our attention
and commitment to delivering
exceptional service to our customers
and creating memorable, stand-
out experiences is the best way to
ensure that customers will return to
shop with us, and recommend our
brand to their friends and family.
Our purpose goes beyond just
the products we sell and the way
we sell them. Our business was
founded on a passion for cooking,
and collectively we are passionate
about helping our customers enjoy
cooking. With the right equipment
in their kitchens and at their dining
tables cooking and dining can be
a real pleasure, whether it’s for
a special occasion, or simply an
everydaymeal.
We will ensure we deliver this
purpose in all we do. By continuing
to be obsessed about product
quality and value, passionate about
the service we offer and creating
an experience makes it easy for
everyone to enjoy cooking more, we
will equip everyone with the tools to
bring joy to everyday cooking.
Equipping everyone with the tools to bring joy to everyday cooking
We welcome everyone and
want you to find just what you
need for your kitchen
Having the right kitchenware will transform
any simple chore, or complicated task
into a more enjoyable experience
Whether you are boiling an
egg or cooking a feast, we
are here for it all
We don't just sell products. We design and source
our range to suit ever need, and we help customers
discover how to get the best from our products
Product
Obsessed about
quality and value
Service
Welcoming to everyone and
passionate about service
Experience
Making it easy for everyone
to enjoy cooking more
Group plc Annual Report and Accounts 2023 11
Strategic Report
Affluent achievers
Rising prosperity
Comfortable
communities
Financially
stretched
Urban adversity
Other
Customer mix %
2
40.9%
22.5%
11.6%
11.7%
5.3%
16.4%
23.2%
27.2%
9.5%
1.2%
1.1%
29.4%
Our priorities
We will attract new customers to
the brand and turn them into loyal
advocates through a multi-channel
anddata-driven media strategy.
Raising brand awareness and growing
our new customer base will be crucial
in the years ahead. Our newly defined
purpose will ensure that all messages
are aligned and demonstrates how
we can help everyone regardless
of their cooking mission. We will do
this through a data-driven media
strategy, using inspiring new creative
executions to speak to our target
audience based on affluence and
interest type. We will drive greater
awareness and consideration at the
top of the media and marketing funnel
which will positively impact our current
performance media channels, allowing
us to further improve our return on
investment and drive efficiencies in
overall customer acquisition costs.
Our PR and Social activity will support
this, increasing the reach of our ProCook
purpose further, with other trusted
sources and influencers telling our brand
and product stories and showcasing our
products in editorial content.
All our activity will be measurable to
understand the brand, customer,
and commercial impacts
individually and collectively,
allowing us to strengthen
our actions throughout
the year.
How we then retain these
customers will also draw
on our rich customer
data. Using our new CRM
system to segment our
customers in a number
of ways will ensure that
we are improving repeat
purchases by inspiring
them with the offers and
value they are likely to be
interested in at just the right
time. We want all of our customers
to get what they need from ProCook,
and therefore a multi-channel
personalisation programme will turn
new customers into loyal customers
who are also brandadvocates.
Introducing our customers
Our current customer mix is more
heavily weighted to higher affluency
groups in the UK compared to the
national average, with 20.5% higher
mix of the highest two affluency
categories compared to a 22.7%
lower mix of the lowest two affluency
categories. Our customers live
comfortable lives and have fewer
financial concerns than most, giving
them a high proportion of disposable
income to spend on hobbies,
interests, and their home. They are
most likely to be professional couples
or retired, who own their ownhomes.
Our customers are not overly price-
sensitive, but they are savvy and do
seek quality and value. They typically
buy in to brands that demonstrate this
and often undertake research before
making any major purchases.
55% of adults shop kitchenware once
every 6 months, with 8% shopping
frequently at least once every
3months. aintaining front of mind
awareness within the higher frequency
groups is key, even when they are not
actively in market.
1
Female
2
12 month repeat rate
£
Average household income
3
£
average spend online
L12M active customers
£
average spend in store
1
YouGov Survey, 4000 participants, January
2023. Peer group reflects the combined
average results of Tefal and Le Creuset
2
Greenstone data report (August 2022)
3
Acorn affluency profiling (August 2022)
Group plc Annual Report and Accounts 202312
Attracting more customers to our brand
Continued
1
Consumer trends
Increased interest in cookery shows,
health and well being
Cooking is considered as a hobby
by 38% of UK adults
4
. The average
adult will spend three years of their
lives cooking. An evening meal takes
on average 49 minutes to cook, but
only 23 minutes to eat
5
. Increased
interest in nutrition and wellbeing
has resulted in a deeper interest in
cooking. The UK population enjoy
watching other people cooking as
much they do spending time in their
kitchens. Between The Great British
Bake Off, MasterChef and Great British
Menu, as well as online recipes and
new celebrity cookbooks, people
in the UK are, on average, spending
over five hours a week looking at and
watching “food media”. This provides
a great opportunity to target our
audience when actively engaged in
cookingcontent.
Sustainability in purchasing decisions
Consumers are increasingly concerned
about the environmental impact of
their buying decisions, and increasing
engagement with climate change
continues to drive a shift in consumer
preferences. Customers are more likely
to seek our more natural and organic
feeling materials in products they
buy, looking for more sustainable and
environmentally friendly alternative
to synthetic materials. Materials such
as wood, bamboo, glass, stone, and
ceramic are becoming increasingly
popular, with consumers also seeking
out products that are handmade or
have a unique textures or patterns.
Seeking out greater quality and value
The top concern for 63% of Britons
is the state of the economy and their
personal finances.
6
It is therefore
unsurprising to note that 50% of all
customers who are shopping with new
brands are doing so based on value for
money or better pricing.
7
. However,
consumers are seeking more than just
price, with quality also being taken into
consideration. A secondary trend in
value definition is that consumers are
seeking more 2-1 benefits with a 16%
YOY increase in search queries related
to “cheap and best” and emerging
trends in “best and sustainable”
8
and
such like showing consumers to be
demanding more than simply price
from products and the brands they
shop with.
4
YouGov Survey, 4000 participants,
January 2023
5
Tilda Study, March 2022
6
Ipsos Essentials, January 2023
7
McKinsey & Company Europe Consumer
Pulse Survey, February 2022.
8
Google trends data, UK, 2022 vs 2021
Strategic Report
13Group plc Annual Report and Accounts 2023
Our priorities
#1
Retail service
excellence
#2
Retail expansion
#3
Develop a world-
class website
#4
Extending and
improving product
ranges
#1
Retail service excellence
Service excellence has never been
more important as customers
are seeking extra guidance and
reassurance about their purchases,
in an environment where disposable
incomes are under real pressure.
We are committed to the highest
standards of service, helping to create
the best possible experiences for
ourcustomers.
With low current unemployment,
recruitment has become more
challenging and so our continued
focus on colleague engagement is
key. We are working hard to improve
communication, total reward, and
wellbeing throughout our business and
especially for our retail colleagues,
while also ensuring that we have the
right people in store at the right time
to optimise service for our customers.
We are strengthening our management
structures to create a stronger
performance-based culture where we
recognise and celebrate success and
provide support to teams that need
further development.
In the year ahead we will update
and relaunch our colleague training
programmes across all retail skills
areas, including product, service
and selling skills. We will be providing
additional training to management on
how to consistently achieve the high
retail standards we aspire to, while also
launching a leadership development
and progression programme to
support the development of our
retail store managers into first class
leaders, helping to develop careers
andretaintalent.
We remain focused on process
simplification, using technology where
possible, to remove or speed up
manual tasks and improve efficiency,
allowing more store hours to be
focused on customer service.
We are obsessed with product quality and
offering our customers the best possible
value by cutting out the middleman
through direct sourcing. Operating our
own stores and website allows us to
provide the best possible service to our
customers.”
Daniel O’Neill
CEO & Founder
Group plc Annual Report and Accounts 202314
Developing our customer proposition
2
Potential location
Eisting location
#2
Retail expansion
Our retail stores are a critical
component of our proposition, offering
customers the opportunity to test, feel
and seek advice on our product range.
Our 58 stores are located in leisure
destination centres throughout the UK
and with retail store sales representing
over 70% of the kitchenware market
and acting as a brand beacon for
awareness and online sales, we have a
strong confidence in their role to play
for many years ahead.
We have expanded our estate over
recent years, adding three new stores
in FY23, and increasing selling space
through upsize relocations for two
more existing stores. Our current
average store footprint is 2,100
sq. ft, and our more recent stores
openings have been nearer 2,600 sq.
ft on average providing more space
to showcase ranges including our
expanding tableware ranges.
Where we have relocated stores to
larger units we have seen a strong
return on investment, giving us
confidence to continue this strategy
for strong performing stores with
compromised space.
Potential future retail locations
In the latter part of the year, supported
by external expertise, we assessed the
potential for retail estate expansion
in the UK. This has increased our
expectation of how many stores we
can open in the UK and provided a
list of target location opportunities
to consider. We will pursue these
newly identified locations with
appropriate caution over the years
ahead, in this rapidly changing retail
environment, setting and monitoring
payback periods and minimum
contributiontargets.
#3
Developing a world class
website
77% of adults are likely to research
kitchenware online before making a
purchase, either in store or online, and
so our website must be our biggest
and best shop to attract, inspire and
engage customers.
Our current website has had a similar
customer experience for many years,
and while it operates effectively
as an ecommerce site, it is in need
of modernisation and redesign to
improve performance, deliver our
brand purpose, and provide our
customers with an experience akin to
our retailstores.
We have already completed a technical
re-platform of our website in the first
half of the last year, improving the code
base which has made subsequent
developments far quicker and has
improved site speed. Our next step is
to redesign and relaunch the site in its
entirety, with a new user experience
and functionality improvements. This
mobile-first design will aid customers
through their shopping journey with
calm, clear signposting and engaging
content, and enhanced navigation,
search, and payment functionality.
Supported by external design
consultants, we are making good
progress with this programme and
anticipate that we will begin thorough
A/B testing and migration during
summer 2023, ready for full launch
before our peak trading period.
Post transition, we have developed
a roadmap of experiments and
functionality improvements through
agile development which will
allow us to continually improve the
usereperience.
Group plc Annual Report and Accounts 2023 15
Strategic Report
#4
Extending and improving product ranges
During the last year we have continued
to improve our product ranges
launching 154 new products, and
replacing a further 139, with an overall
range refresh rate of 20%. Key changes
include the introduction of our new
Gourmet cookware ranges, refreshing
our extensive range of kitchen knives,
and extending our tableware, baking
and accessories offers.
In the year ahead we will be focused
heavily on our cookware ranges,
launching on-trend coloured
products and stackable (space-
saving) cookware, seasoned carbon
steel cookware pans and woks and
extending our promotional offer.
We will continue to develop our
tableware ranges, extending our mugs
range, and launching new reactive
glazed dining sets to offer more choice
to customers in this category.
Our new small kitchen electricals offer
is moving forward, creating another
reason to shop with ProCook, and
having found a new manufacturing
partner, we have designed and ordered
our first phase of electricals which
we will launch in the first half of FY24.
We will continue to extend this range
throughout the year with additional
electricals products.
tearearet£
2024 (F) 2025 (F)2023 (F)2022 (A)2021 (A)2020 (A)2019 (A)2018 (A)2017 (A)2016 (A)2015 (A)
3.5 4.04.04.03.93.53.73.63.53.5 4.1
Market overview
The £4bn UK kitchenware market
1
is large and stable, with a track
record of steady growth. In 2022
we estimate that our share of the
market was 1.85% (FY22: 1.90%). The
market comprises three categories:
cookware, knives and accessories,
and tableware. In 2022, growth in
the cookware market (our most
developed category) has been more
subdued, following strong growth
during and post-pandemic. The
tableware category which makes
up over 50% of the market and
where our share remains lowest,
grew the most strongly, with our own
performance ahead of the market.
During the year, the market
experienced a significant channel
shift back to retail from ecommerce
channels, particularly exacerbated
by the Royal Mail strikes during the
peak trading period before Christmas
2022. The impact of inflation was also
evident with price increases partially
offset by reductions in volume.
We estimate the UK small kitchen
electricals market is worth
approximately £1bn per annum,
extending our total market size
by 25%.
New small
electricals range
1
Euromonitor International “Homewares in the United Kingdom” April 2023
Group plc Annual Report and Accounts 202316
Developing our customer proposition
Continued
2
We are working hard to build on our
foundations, strengthening our business
model for the future and providing
additional capacity for growth.”
Dan Walden
Chief Financial Officer
Technology and data
Our bespoke technology stack which
is highly flexible and customised to
our operations is a critical enabler for
our ongoing success, and ensuring
it’s integrity, resilience and security
is paramount. We integrate third
party tools to complement our
internally developed website and
operatingsystems.
Our longer term technology roadmap
sets out the journey we will take
towards more microservice-based
architecture, carving out functionality
to use across our channels and
operations, improving resilience
andfleibility.
In the next twelve months our
development effort will focus on our
customer-facing services, primarily our
new website design and performance,
but also improvements to our payment
functionality, and our marketing
capabilities.
We will also complete a broad range
of initiatives to improve internal
operational efficiency, including
improving the tools available to our
retail colleagues, our warehouse
management system, and our financial
and reporting systems. We will
continue our ongoing efforts to reduce
risk, improve resilience and improve
our security capabilities across all of
ourtechnology.
Logistics and Supply Chain
As we complete the transition into
our new distribution centre and
headquarters, we bring all of our
logistics operations back under one
roof, providing the opportunity to
realise significant operational savings
and reduce emissions as we eliminate
the transfer of product between
sites. Driving forward our operational
efficiency, through the use of a smaller
multi-skilled team in our warehouses
and greater automation, is our
primary focus for the years ahead and
particularly the next twelve months.
We will continue to rationalise our
stock file, releasing working capital,
and reducing clearance and overstock
positions through the year. We are
enhancing our replenishment and
forecasting capability to support
this. We expect to launch drop and
swap container capability in the
months ahead, and utilise ports
with closer physical proximity to us,
reducing our port to DC haulage costs
andemissions.
Group plc Annual Report and Accounts 2023 17
Strategic Report
Building on our strong foundations
3
Our values
#1
Building an engaging and
oetreedoraes
Over the last 12 months, we have delved
into the principles that are important
to our people, and those which our
business have been founded upon. We
have articulated these principles in a
set of six values, which we have recently
launched with our colleagues.
Over the coming months we will
embed our purpose and values
within our culture, through training
and engagement activities which will
elevate awareness across all of our
teams, creating clear expectations
of what we expect of each other, and
aligning our activities and priorities.
Maintaining an open culture with
engaged colleagues is key to our
success. We will continue to listen to
feedback through engagement surveys
and our Colleague Advisory Panel,
ensuring that we prioritise the actions
that are most important to our people in
creating an even better place to work.
#2
Developing our teams and
our leadership capabilities
We are committed to supporting our
colleagues’ personal development
and creating fulfilling careers with
progression opportunities. Having
relaunched our annual colleague
objective setting and appraisal
process for the new financial year,
we are now increasing our focus on
personal development plans.
We will be improving our succession
planning capability ensuring that
we adequately identify and nurture
talent for the future. We will re-launch
our Retail career progression and
development matrix, with prescribed
training for each role level to ensure
all colleagues receive quality and
comprehensive training as standard.
Our programme of bitesize workshops
and e-learning platform will support the
role out of skills and capabilities training.
Our leadership is key to creating
engaged and high performing teams,
and we will be launching a leadership
development programme for an initial
trial cohort which, if successful, can
be rolled out to all management and
leadership colleagues.
#3
Creating a place where
everyone is welcome and
wellbeing is prioritised
We expect all colleagues to treat each
other, and our customers, with integrity
and respect, and we want everyone to
feel welcome whether working with us,
or shopping with us. This year we will
be focusing on increasing awareness
around diversity, equality, and
inclusion, providing our colleagues with
opportunities and resources to learn
more about this.
Over time, we will launch a series of
internal network groups, sponsored
by our Leadership Team. This will
commence with our LGBTQ+ and
Women in Business groups, providing
the opportunity to celebrate diversity
and increase support for colleagues.
We will continue to focus on colleague
health and wellbeing, developing
and launching further policies and
procedures, training, and events,
whichsupport our Wellbeing and
Mental Health policy.
Always do the
right thing
Build a better business
Obsessed with quality
Focused on value
Create a great place
to work
Care for our
community and planet
Our priorities
Creating an even better place to work
4
Group plc Annual Report and Accounts 202318
In September 2022, we took
possession and began the
internal development of our new
headquarters in Gloucester.
We had three key priorities at the
outset of this significant project:
01
Increase capacity and improve
efficiency for our logistics
operations
02
Create a great place to work
where colleagues can collaborate
03
Ensure our new facility is
developed with sustainability
in mind
In February 2023 we began the
transition into the new site, which
consolidates our two existing
distribution centres sites into
one site and provides significant
capacity for future growth in its
167,000 sq.ft. This has allowed us
to consolidate two operations into
one, creating a single stock-file,
a more flexible organisational
structure, and eliminating
wasteful stock pick activity and
transport between locations.
We put in a lot of thought
and planning to ensure that
this new site would improve
colleague wellbeing and
provide an environment where
colleagues could collaborate
more effectively together. We
developed a new showroom and
a larger studio for developing our
own visual and video content. We
installed a wellbeing Room, an
onsite gym and walking track, a
colleague restaurant, and ample
breakout space and meeting
rooms for meetings and informal
interactions.
The new headquarters is
certified as BREEAM ‘Excellent’
passing strong sustainability
criteria in several categories,
including water, energy, health
and wellbeing, waste, pollution,
resources, land use and ecology.
It has a low impact design and
is extremely energy efficient,
utilises solar energy and harvests
rainwater, allowing us to further
reduce our carbon emissions and
reduce our water consumption.
Our new headquarters
– case study
#4
Supporting our
communities
We are committed to supporting the
communities in which we operate and
proud to work with Life’s a Beach and
Young Gloucestershire and others in
giving our time, resources, and skills to
support their causes.
Our Good Causes Day offers
colleagues the opportunity to
participate and support charities which
are important to them, and we will again
raise the profile of this, and encourage
greater participation. We will increase
our charitable fundraising activities
and promote colleague teambuilding
through participation in charitable
activities across our business.
We are increasing our early careers
capacity, providing more work
experience, internship, apprenticeship,
and graduate opportunities to younger
people in our communities to get on the
career ladder. Through our work with
Young Gloucestershire, we are planning
to launch CV and interview preparation
workshops led by our colleagues, for
those in our communities with barriers to
employment, and for students seeking
to develop their employability skills.
Our colleagues
68%
Colleagues
who are
female
43%
Leadership team
who are female
15%
Colleagues from
ethnic minorities
67%
Colleague
engagement
score
6%
Gender
pay gap
Strategic Report
19Group plc Annual Report and Accounts 2023
Progressing to Net Zero
We have already made substantial progress in reducing Scope 1 and
Scope 2 emissions to just 1.2% of our total emissions through a range of
initiatives in recent years. Our CO
2
emissions have reduced by 63% since
FY19 whilst our revenue grew by 124% during the same period. We will
continue to focus on reducing these further, whilst also taking steps to
tackle emissions in the Scope 3 areas which are not directly in our control.
We have identified eight priority actions that we will focus on over the
net12months to progress our ourney towards Net ero:
Policies
Strengthen and update
environmental and ESG policies
(e.g. purchasing, energy, waste
management, human rights)
Environmental management
sste
Improve and fully align EMS
documents to ISO4001
More efficient property
Improve store efficiencies.
Understand differences in energy
usage of similar size ProCook
stores to make improvements and
reduce overall energy consumption
Reduce and recycle packaging
Continue to improve our product
packaging recyclability and
remove single use plastics
Data quality
Identify operational data gaps
and improve collection and
management (e.g. business travel)
Engage suppliers
Identify key suppliers for initial
engagement and understand
theirenvironmental targets
Travel
Improve WFH and employee
commuting data and distribute
sustainable travel plans for our
newheaduarters
Engagement and education
Develop a communication plan
informed by a stakeholder analysis
to engage colleagues and achieve
cross company commitment
As a B Corp we are committed to
reducing our impact on the environment
for the benefit of our stakeholders as a
whole. Wecontinuously strive to improve
our own operational practices, promoting
the highest social and environmental
standards we canachieve.
Being certified holds us accountable
to our actions, and we must undergo a
reassessment every three years to remain
certified. Having achieved the entry
threshold in September 2022, we will now
focus on improving our practices even
further ahead of recertification, with the
aim of increasing our score to over 85
points in 2025.
Group plc Annual Report and Accounts 202320
Reducing our environmental footprint
5
We launched our Green Team in
FY23 with the objective of increasing
collaboration to accelerate our
progress in reducing our environmental
footprint. Our cross-functional Green
Team includes colleagues from retail,
logistics, marketing, andproduct
departments.
ProCook’s Green Team - case study
The team meets each month to identify
opportunities, share ideas, and
implement initiatives to promote more
sustainable practices. Each Green
Team member acts as ‘sustainability
champion’ driving forward positive
change, while motivating and
educating their colleagues to be more
environmentally aware.
Our Green Team have already
implemented a number of initiatives
and championed our focus on making
simple day to day choices which
benefit the environment. The team have
introduced ‘Meat Free Mondays’ in our
colleague restaurant; a simple initiative
aiming to encourage people to eat
less meat and try more vegetarian
recipes benefiting both the planet
and our colleagues’ health, and shared
ideas ahead of our Autumn 2022 retail
conference to ensure it was our most
sustainable conference yet, and the
first to be completely free of single-use
plastic. Further activities have included
the production of engaging waste
posters and signage to raise awareness
and enhance the recycling effort for
all waste streams in our HQ, as well
as designing educational material for
World Environment Day to help reduce
use of bubble wrap and encourage use
of 100% recycled paper void material
wherever possible.
21Group plc Annual Report and Accounts 2023
Strategic Report
Read more:
Strategic Report -
pages 2 to 73
Read more:
Board activities -
pages 82 to 85
etotateet
Our decisions and actions
have significant impacts on our
stakeholders, and in delivering
our strategy and fulfilling our
purposewe are guided by our values
tobuild a better business and to
always do the right thing.
We are committed to regular, open
and effective engagement with our
stakeholders and recognise that
this is essential to ensure that the
impacts of important decisions are
appropriatelyconsidered.
Board directors are required under
the Companies Act 2006 to promote
the success of the Company for the
benefit of our members as a whole. In
doing so, they must have regard to the
interests of all stakeholders. Where the
Board does not itself engage directly
with certain stakeholder groups, it
oversees the engagement activities
of management, and receives regular
updates on such activities.
The Directors confirm that they have
acted in a way that they consider,
in good faith, to be most likely to
promote the success of the Company
for the benefit of its members and
stakeholders as a whole, and in doing
so have had regard to the matters
set out in s172(1) (a) to (f) of the
CompaniesAct 2006.
This confirmation, together with
the detail on the following pages
comprises our Section 172(1)
statement, and sets out how the Board
has, in performing its duties over
the last year, has had regard to the
matters set out in sections 172(1) of the
Companies Act 2006 (the ‘Act’) when
performing their duty to promote the
success of the Company.
In this section we describe how we
engage with of each of our stakeholder
groups, developing our understanding
of their needs and interests, and
how in turn, these are considered by
the Board in our decision-making
processes. Whilst Directors engage
directly with stakeholders on certain
topics, stakeholder considerations
on the whole are brought to the
Board’s attention through reports
and presentations from the Executive
Directors and senior management.
Thisis an integral element of regular
Board reporting. Further information
can also be found throughout this
Strategic Report, and in the detail
surrounding key strategic decisions set
out in the Governance Report.
Engaging with our Stakeholders
Sanoma glazed
tableware range
Group plc Annual Report and Accounts 202322
atsortattoorstoers
• Product quality, design, choice,
andvalue for money
• Ease of shopping experience
acrossall touchpoints
• Inspiration and advice
• Sustainability
How the Board engages
• The Board reviews customer KPIs
and insight at each Board meeting,
including repeat frequency, lifetime
values, acquisition performance and
satisfaction.
• In light of the Board’s commitment
to continually improving customer
experience it recommended
the appointment of a new Chief
Marketing Officer role in FY23 to
elevate our focus.
• The Board regularly visits our stores
providing opportunities to interact
with customers for themselves.
Customers
Our mission is to become the customers’ first choice for kitchenware, and we are recognise that delivering an excellent
customer experience is crucial in developing our brand.
How ProCook engages
• We gather data and feedback
from our customers on the quality
of service and their satisfaction
with the products they purchased.
We analyse this information to
help us identify opportunities to
make improvements.
• We conduct mystery shopping
activities to ensure our customer
experience is as strong as it
can be.
• Our direct marketing heritage
has meant that we have collected
customer data for many years.
We now have almost four million
customers on our database, and
we analyse and interpret customer
activity to create more tailored
marketing plans to offer a better
experience.
• We engage with our customers
through a range of activities
including social media, emails,
and digital content, providing
inspiration and guidance. Through
these channels we review and
respond to customers’ comments
and other interactions.
• Our colleagues regularly
visit stores, to understand
the customer experience,
identifying opportunities to make
improvements.
• Our Cookery School provides the
opportunity for us to interact with
customers, helping them develop
their skills while showcasing our
product ranges.
Read more:
Introducing our
customers -
pages 12 to 13
Group plc Annual Report and Accounts 2023 23
Strategic Report
Engaging with our Stakeholders
Continued
Colleagues
Our people are key to the long-term development of our business. Their engagement and motivation is vital to us fulfilling our
purpose, living our values, protecting our culture, and delivering our strategic objectives.
What’s important to our colleagues
• Our culture and values
• Wellbeing
• Community and the environment
• Regular communication on
objectives, performance, and
strategy
• Personal development
• Fair reward
How the Board engages
• The Board reviews reports on People
KPIs, issues and strategic progress at
each board meeting.
• The People Director presents to the
Board twice a year, providing the
opportunity to discuss and approve
our People strategy.
• Engagement survey results, along
with action plans, are reviewed and
discussed at Board meetings.
• Luke Kingsnorth, the designated
colleague engagement Non-
Executive Director, attends
Colleague Advisory Panels and
reports back to the Board (read more
on page 77).
How ProCook engages
• Every four weeks we hold a
company-wide Town Hall briefing
led by the Executive and Leadership
Team. These sessions allow
us to improve communication
and alignment, incorporating
performance reviews, a Q&A forum,
colleague recognition, and strategy
updates.
• The Leadership Team hold weekly/
monthly all-hands meetings with
their respective functions, ensuring
that colleagues have opportunities
to contribute to voice issues and
develop action plans together. In
Retail we hold a conference twice a
year to bring our leadership together
from across the country, to celebrate
performance and plan for the
period ahead.
• We offer regular learning and
development opportunities for all
colleagues via our online training
platform, and through face-to-face
training sessions including short
bite-size sessions. These cover a
broad range of development needs
from product to leadership, helping
our people develop and grow
throughout their career.
• We are committed to listening
to our colleagues’ feedback
through engagement surveys.
These are anonymous and
contain a mix of quantitative and
qualitative questions, allowing us
to understand what is important.
We develop and implement
action plans, and ensure we
communicate progress against
these with our colleagues.
• Our Colleague Advisory Panel
meets quarterly to discuss
different themes which are
important to our colleagues, with
representatives from across the
business. Recommendations for
improvements are presented to
the Leadership Team who take
responsibility for implementation.
• We are committed to being
a Real Living Wage employer,
and to offering a strong and fair
total reward package which
includes a comprehensive range
of benefits for all colleagues.
We are cognisant of the cost
of living impact and have taken
appropriate actions to support
our colleagues through this
difficult period.
Read more:
Creating an even
better place to
work - pages
18 to 19
Read more:
Sustainability:
Our People –
pages 31 to 35
Group plc Annual Report and Accounts 202324
What’s important to our suppliers
• Long term partnerships
• Fair terms and conditions
• Transparency in interactions
• Growth opportunity
How the Board engages
• The Board reviews information
presented by the Leadership team
on the supplier base, including Sedex
membership and value of trade. The
Board monitors where suppliers are
based including ensuring compliance
with any government sanctions.
• Board Directors, and especially
the Executives, maintain a
number of supplier relationships
directly themselves, ensuring that
relationships are strengthened
and strong working conditions are
created.
• The Board discusses key supplier
partnerships in relation to strategic
decisions with the Executive
Directors. In the last year these have
included decisions made regarding
Amazon and EU distribution partners,
and the new ProCook HQ in the UK.
Suppliers
Our suppliers are critically important, collaborating with us to design and source new products for our customers, and
providing services which allow us to continually develop our customer proposition. We believe in treating everyone fairly,
including our suppliers. This has allowed us to build enduring supplier relationships, some for over 20 years, which help ensure
that we are always working towards a common goal.
How ProCook engages
• We attend product and
other relevant trade fairs and
conferences to meet with our
existing supplier partners and
meet potential new suppliers,
develop relationships, and
remain well informed of industry
advances.
• Our membership of Sedex
allows us to work with suppliers
to promote and improve ethical
and environmental standards.
As a B Corp certified business,
we continue to set rigorous
expectations with our suppliers
and help them to develop
improvement plans where needed
to reduce our environmental
footprint, and ensure we act as a
responsible partner.
• Our design and purchasing teams
interact with suppliers frequently,
working on new design concepts
and range development, through
to intake management and
planning. We are open, honest,
and fair in our approach, and work
together to solve challenges
that arise.
Gourmet
stainless steel
cookware range
Group plc Annual Report and Accounts 2023 25
Strategic Report
Communities
We are committed to our community and planet, with community acceptance of what we stand for, how we operate and
being a force for good, being important in providing us with permission to continue to develop and grow. The positive impact
we create reinforces ProCook as a great place to work, and a great place to shop.
What’s important to our communities
• Employment opportunities
• Giving back to the community
• Reducing our environmental
footprint
How the Board engages
• The Environmental, Social and
Governance (‘ESG’) Director
presents to the Board twice a year,
providing the opportunity to discuss
and approve the strategy, and
progress being made.
• Directors participate in various
charitable activities with our partners
including Life’s a Beach to support
their causes and raise the profile
amongst our colleagues.
How ProCook engages
• We sell Life’s a Beach branded
products in our stores raising
awareness, and generating funds
to support the Life’s a Beach charity
whose aim is to fund schemes to
help eradicate single-use plastics
from our beaches via education,
beach cleans and the promotion of
multiple-use products.
• We offer all colleagues the
opportunity to take a fully paid day
to volunteer for a good cause. We
also encourage our colleagues to
volunteer on beach clean days with
Life’s a Beach to make a positive
difference in our communities.
• Our partnership with the
Woodland Trust provides
opportunities for our colleagues
to participate in generating
woodland spaces for their
communities while also mitigating
unavoidable Scope 1 and 2
emissions.
• We continually seek to reduce
our impact on the environment,
through minimising packaging
and removing non-recyclable
materials, utilising more
sustainable materials, minimising
energy use, and reducing
emissions.
• We engage with our customers
on environmental matters,
offering product ranges that allow
them to make more sustainable
choices to help protect their own
communities.
• As we have grown, the number
of people we employ continues
to increase creating paid
employment opportunities
across the UK. We recruit locally
wherever possible, supporting
local communities, and we are
committed to developing our
people to provide fulfilling careers
with ProCook.
Engaging with our Stakeholders
Continued
Read more:
Creating an even
better place to
work – pages
18 to 19
Read more:
Sustainability:
Our People –
pages 31 to 35
Read more:
Life’s a Beach
case study –
page 39
Supporting Life’s a Beach
with community events
Group plc Annual Report and Accounts 202326
What’s important to our communities
• Strategy development and execution
• Value creation and return on
investment (short or long term)
• Strong governance and sustainability
How the Board engages
• The Annual General Meeting
(“AGM”) provides the Board’s
primary opportunity to interact with
shareholders. At the AGM last year,
representatives from approximately
80% of the shareholder base were
present at the meeting with over 88%
of shareholders votes received for
the various resolutions tabled.
• The Board receives and discusses
shareholder register analysis each
quarter, and reviews feedback from
analysts and investors after each
results presentation, identifying
opportunities for development.
• Communications to investors are
reviewed by the Board or delegated
to the Disclosure Committee to
ensure the messaging and content
is clearly presented and complete to
aid understanding.
How ProCook engages
• Executive Directors present to
investors as part of a scheduled and
ad-hoc meeting cadence. These
presentations cover key areas of
investor focus, including our trading
performance, financial results
and strategy development and
execution.
• Our Company website www.
procookgroup.co.uk provides
information and latest news updates
to our investor community. Included
here are of our interim results, final
results and a video introduction
to ProCook featuring members
of our Leadership Team. We
publish financial information, RNS
announcements as well as detail
about our approach to governance
and our Company policies.
Shareholders
The Board recognises that the trust of our shareholders, through their ongoing engagement ensures their continued support
and investment, in turn supporting ProCook’s continued growth and development.
Baking lessons
in our London
Cookery School
Group plc Annual Report and Accounts 2023 27
Strategic Report
B Corp - case study
B Corp - case study
As part of the global
B Corp community,
we form a growing
movement of businesses
working towards a
healthier planet, reducing
inequality, and building
stronger communities,
both locally and globally.
We are committed to doing the right
thing, and our B Corp certification
means our stakeholders, including
customers, colleagues, and investors,
can easily identify us as a business
with a clear purpose to benefit all
stakeholders including our people, our
communities, andour planet.
At ProCook we continuously strive
to improve our own operational
practices, promoting the highest
social and environmental standards
we can achieve. We are very pleased
that the B Corp movement is growing
and are proud to be, at the time of
certifying, one of just 1000 businesses
in the UK which has been awarded the
certification.
The B Corp certification process
required a rigorous independent
analysis of our Company processes,
policies, and operational practices,
taking almost a year to complete.
Thethreshold for certification is 0
points on the B Impact Assessment
(BIA), and the median score for ordinary
businesses who currently complete
the application process is 50.9 points.
This is assessed across five areas:
Workers, Governance, Customers,
Environment, and Community. Once
the application is submitted, B Lab
then verify each answer through the
provision of additional evidence to
validate application responses.
Having achieved the entry threshold in
September 2022, we will now focus on
improving our practices even further
ahead of recertification, with the aim
of increasing our score to above 85
points in 2025. Being certified holds
us accountable to our actions, and we
must undergo a reassessment every
three years to remain certified. The BIA
score is an important internal metric for
us, as it demonstrates our commitment
to being a socially responsible and
environmentally conscious business.
Group plc Annual Report and Accounts 202328
Strategic Report
Workers evaluates a company’s
contributions to its employee’s
financial security, health and safety,
wellness, career development,
engagement, and satisfaction. It
recognises business models designed
to benefit employees, and those
that have workforce development
programmes to support individuals
with barriers to employment.
The Governance section considers
a company’s overall mission,
engagement around its social and
environmental impact, ethics, and
transparency. It also evaluates the
ability of a company to protect their
mission and formally consider all
stakeholders in decision-making
through its corporate structure or
governance documentation.
Customers evaluates a company’s
stewardship of its customers through
the quality of its products and services,
ethical marketing, data privacy and
security, and feedback channels.
Additionally, it recognises products or
services that are designed to address
a social problem for its customers or
provides a service that improves the
social impact of other businesses or
organisations.
The Environment assessment looks at
the company’s overall environmental
management practices as well as
its impact on the air, climate, water,
land, and biodiversity. This includes
its own direct impact of operations
and that of its supply and distribution
channels. It recognises companies with
environmentally innovative production
processes or products and services that
have a positive environmental impact.
In consideration of Community,
this section evaluates a company’s
engagement with and impact on the
communities in which it operates,
hires from and sources from. It
considers diversity, equality and
inclusion, economic impacts, social
engagement, and charitable giving.
Where we performed
particularly well
Factors contributing to our strong
score in the Workers evaluation
included our safe and welcoming
workplaces, our caring and supportive
family culture, and our focus on
colleague engagement; listening and
acting on feedback we receive to make
ProCook an even better place to work.
Other supporting elements included
being a Living Wage Employer, being
a non-discriminatory workplace
as reflected in our diverse mix of
colleagues, and being certified as a
Great Place to Work
TM
and recognised
by the UK’s Best Workplaces™ for both
Wellbeing and Women.
In the customers section of the BIA,
our score reflects our obsession with
our high-quality products, on which
we offer up to 25-year guarantees.
Additionally, our stringent data, privacy
and security policies and procedures
protect our customers. We encourage
feedback from our customers and
combined with our focus on customer
service excellence, we have an
“excellent” rating of 4.7 / 5 on Trustpilot
with over 95,000 reviews of which over
85,000 are five-star ratings.
Continually improving as
aor
Over the years ahead we aim to
continually improve our operational
practices and our BIA score. Within two
years of certification, we will produce
an impact report to share our progress.
We are dedicated to ensuring all of our
colleagues are engaged in our B Corp
journey.
We will continually focus on improving
our environmental performance both
internally and throughout our supply
chain. Using our strong supplier
relationships, we will work closely with
manufacturers to improve the quality
of environmental data recording,
reduce our environmental footprint,
and help eliminate or mitigate Scope 3
emissions wherever we can.
Becoming a B Corp is much more
than just a one-off certification, it’s
a movement for change, which we
are committed to making continual
progress with and encouraging others
to do the same.
Our results
ProCook
Comparators
Country Sector Size
Overall 80.0 50.9
Workers 29.0 19.1 15.9 18.0
Governance 8.3 7.7 7.0 6.4
Customers 3.6 2.2 2.3 2.0
Environment 24.0 11.2 11.3 10.8
Community 17.5 12.3 13.0 10.8
29Group plc Annual Report and Accounts 2023
Our People
Creating an even
better place to work
Our
Planet
Reducing our
environmental
footprint
Our
Product
Helping our
customers make
more sustainable
choices
Doing
the right
thing
Sustainability
We have made further strong progress with our sustainability journey this year with highlights including becoming the first FTSE
listed retailer to be awarded the B Corp certification, achieving the Great Place to Work
TM
certification for the second year
running, and working with external expert partners to prepare a thorough and comprehensive global carbon footprint analysis.
This analysis, which includes our Scope 3 emissions, will help us in understanding our impact as we progress towards our
ambition to achieve net zero. We continue to develop our culture and work environments for our people, to create a thriving
and successful, environmentally aware business.
People, product, and planet
We place great importance on
improving our sustainability across
all aspects of our business, in
order to reduce our environmental
footprint, and give confidence to our
stakeholders that we are doing the
right thing.
We are developing our knowledge and
experience in environmental reporting,
climate change science, and ethical
sourcing, and we continue to prioritise
the support we give to our colleagues
to help make ProCook an even better
place to work.
Our certification as a B Corp in
September 2022 demonstrates that
we are definitely moving in the right
direction.
There are very few publicly listed brands
certifying as B Corps so we’re incredibly
proud to be trailblazing in our sector. The
work that goes in to certifying is enormous
but worth every effort. Alongside our
sustainability goals, B Corp provides a
stringent framework against which we can
measure ourselves. At ProCook we believe in
honouring our responsibilities to people and
the planet alongside our commercial goals.”
Daniel O’Neill
CEO & Founder
Group plc Annual Report and Accounts 202330
Read more:
Our Diversity, Equality and
Inclusion Policy is available at
www.procookgroup.co.uk
Read more:
Our Gender Pay Gap Report
is available at
www.procookgroup.co.uk
People are at the heart of our business, and we are committed to making ProCook an even better place to work. This includes
providing our colleagues with a safe and healthy working environment and having an organisational culture which promotes
diversity, equality, inclusivity, and personal development. We are proud to be a real Living Wage employer and we support our
colleagues to give back to communities through our Good Causes Day and our partnership with Life’s a Beach.
We draw inspiration from the foundations and principles that the family business was built upon, and our values support our
continued drive to continually strive towards a more sustainable future. We know that listening to our colleagues is the key to
improving our business for the future and we continue to seek feedback including through our quarterly Colleague Advisory
Panels and our engagement surveys. On an annual basis we invite all colleagues to participate in the Great Place to Work
TM
survey and we are pleased to have been certified as a Great Place to Work
TM
for the second year running. The survey results
provide us with valuable insights about our culture and the issues that are important to our colleagues allowing us to develop
action plans to address issues and make further improvements.
Responsibility Daniel O’Neill, CEO and Founder
Link to principal risks Brand and customer
People and culture
Link to strategy
4
Creating an even better place to work
Key stakeholders
Customers Colleagues Communities
Link to the United Nations Sustainable Development Goals
Recent recognition, awards, and memberships • Great Place to Work Certified™ (December 2022)
• UK’s Best Workplaces™ for Wellbeing
• UK’s Best Workplaces™ for Women
• Real Living Wage Employer
• Glassdoor ranking 4.3 / 5 (FY22: 4.6 / 5)
Our People — Creating an even better place to work
Diversity, equality, and inclusion
We continue to work hard to ensure that everyone who works for us
feels included and can be themselves at work. Raising awareness
through learning and development is a key tool in helping us achieve
this, and we make use our training e-platform, to share, educate and
inform our colleagues on diversity, euality, andinclusion.
We strive for an inclusive workplace reflective of our diverse society,
supporting all colleagues to learn and grow regardless of age, gender,
disability, sexual orientation, ethnicity, or background.
People here are treated fairly
regardless of their gender
People here are treated fairly
regardless of their race
People here are treated fairly
regardless of their sexual orientation
Source: GPTW survey November 2022
Gender and ethnicity pay gap
We are committed to fair reward for all colleagues
and achieving gender pay equality across all levels
and pay grades in line with the legislation of the
Equality Act 2010 requirement of “equal pay for
equal work”.
Group plc Annual Report and Accounts 2023 31
Strategic Report
Our Commitments How we deliver on our commitment What we are focused on next
We are committed
to creating a
great place to
work, listening
to colleague
feedback to
make continual
improvements
Spring and Autumn conferences to educate, inspire
and engage colleagues on new product, business
developments and performance updates
Regular all-colleague engagement surveys, with clear
action plans implemented
Monthly ‘Green team’ forum with colleagues identifying
and implementing sustainable initiatives
Encourage our new colleagues to test and trial our
products with complimentary welcome boxes
Certified as a Great Place to Work
TM
for the second year
running
NEW in FY23
Launched our Colleague Advisory Panel in Summer
2022 to capture feedback and opportunities for
improvement
NEW in FY23
Introduced monthly Town Hall briefings to better
communicate key messages, celebrate successes,
respond to questions, and recognise exceptional
colleague contributions
NEW in FY23
Embed our new purpose and cultural
values across the business through
training and engagement activities
Deliver on our action plan in response
to feedback from our most recent
engagement survey
Continue our focus on improving
colleague health and wellbeing
Launch our virtual ‘suggestions box’
for colleagues to (confidentially)
provide feedback and ideas to
help make ProCook an even better
placeto work
Relaunch our annual colleague
objective setting and appraisal
processes, increasing our focus on
personal development plans
Colleagues split by gender, age, and ethnicity
Colleagues by gender FY23 FY22
Female 67.6% 68.4%
Male 31.7% 30.2%
Non-Binary 0.3% n/a
Other/Prefer Not to say 0.4% 1.4%
Leadership Team - Female 42.9% 33.3%
Leadership Team - Male 57.1% 66.7%
Colleagues by age group FY23 FY22
Under 18 8% 5%
18-24 28% 20%
25-34 22% 27%
35-44 14% 16%
45-54 15% 18%
55-64 12% 13%
65+ 1% 1%
Colleagues by ethnicity
1
OtherBlackAsianWhite
Mixed or multiple
ethnic groups
85%
86%
6%
8%
2%
2%
3%
4%
3%
1%
FY23
FY22
1
Source: FY23 ethnicity information from voluntary colleague survey with 70% of colleagues providing responses at 2 April 2023, and 60% of
colleagues providing responses for the survey completed in the prior year in May 2022.
Colleagues by full time / part time roles
FY23
Full-time
Part-Time
FY22
Full-time
Part-Time
44%
33%
56%
67%
Group plc Annual Report and Accounts 202332
Sustainability
Continued
Our Commitments How we deliver on our commitment What we are focused on next
We provide a safe
and collaborative
work environment
Comprehensive Health & Safety policy and procedures
with compliance monitoring to ensure a safe environment
for everyone
Custom designed headquarters with room for growth and
ample meeting and collaboration spaces
NEW in FY23
Review and improve where necessary,
all colleague welfare facilities in our
retail stores
Introduce employee Network Support
groups, launching our LGBTQ+ group
first in FY24 with all groups being
sponsored by a member of our
Leadership Team
We take the well-
being and personal
development of
our colleagues
seriously
Provide a comprehensive learning and development
e-platform to support personal development
Colleague gym on-site at headquarters with regular
group training classes to promote exercise and wellbeing
Support colleagues to complete Mental Health First Aid
courses
Prioritise and monitor internal promotions across our
business each year
Continually develop our learning and development
capability to support personal and business performance
Developed our internal communications and created our
Sustainability and Wellbeing Portal to share resources
NEW in FY23
Implemented Mental Health and Wellbeing Calendar and
resources to support colleagues
NEW in FY23
Provide a complimentary Employee Assistance
Programme with Health Assured to all ProCook
colleagues and their families
NEW in FY23
Ranked among the UK’s Best Workplaces™ (large
organisations) for Wellbeing
NEW in FY23
Develop and launch supporting
policies and procedures to support
wellbeing in the workplace
Review and relaunch our existing
fertility and pregnancy loss policy.
Ensure enhanced and specific
support is available for colleagues
who need it
Focus on leadership training,
launching a trial programme for a
first cohort which, if successful, can
be rolled out to all management and
leadership colleagues
Develop the Retail career progression
and development matrix, with
prescribed training for each role
level to ensure all colleagues receive
quality and comprehensive training as
standard
Develop our succession planning
capability ensuring we adequately
identify and develop talent for the
future
We are committed
to supporting the
communities in
which we operate
Good Causes Day available for all colleagues each year to
support a charity or community activity of their choice
Raise funds and awareness for our charity partner Life’s a
Beach through product sales
Contribute and donate products to local community
groups, charities, and schools
Develop relationships in the local community including
partnering with Young Gloucestershire to support young
people in developing their careers
NEW in FY23
Volunteering with Life’s a Beach whereby ProCook
colleagues can participate in beach and canal
cleans
NEW in FY23
Disability Confident Employer (Level 2) status
achieved to ensure we can support all colleagues
effectively
NEW in FY23
Membership of the Employer Supported Policing
scheme aligned to our existing armed forces covenant
and strengthening our commitment to support our
colleagues that give back to communities
NEW in FY23
Raise the profile of our Good
Causes Day amongst colleagues to
encourage greater participation and
support for charities.
Increase our charitable fundraising
activities and promote colleague
teambuilding through charitable
activities across the business
Increase our early careers
capacity providing more
work experience, internships,
placements, apprenticeships,
andgraduateopportunities
Group plc Annual Report and Accounts 2023 33
Strategic Report
Our Commitments How we deliver on our commitment What we are focused on next
We will continue
to be a Real Living
Wage employer
and champion
equality, diversity,
and inclusion
Committed to the Living Wage Foundation as a Real Living
Wage employer
Target equal pay across genders and comparable
role levels
Ensure strong representation of women as managers and
in senior leadership role. 42.9% of the Leadership Team
were women in FY23
Continual focus on total reward package. Current
benefits include colleague discount, family and friends
discounts, pension, SAYE scheme opportunity, and
access to a third-party rewards platform
Provision of Whistleblowing Policy and procedures
ensuring colleagues feel safe to report issues in
confidence if necessary
Linked total reward opportunity to personal
performance to incentivise personal development and
progression
NEW in FY23
Diversity, Equality, and Inclusion Policy established
NEW in FY23
Deliver regular bitesize training sessions on diversity
and inclusion covering topics such as inclusive
recruitment
NEW in FY23
Recognised as an Inclusive Employer Award by Inclusivity
Works, for our flexibility and inclusive recruitment
practices for neurodiverse candidates
NEW in FY23
Supplemented inflationary pay awards to support those
in lower pay brackets during current cost of living crisis
NEW in FY23
Ranked amongst the UK’s Best Workplaces
TM
for Women
NEW in FY23
Continual review of our total reward
package. Launching new salary
sacrifice scheme
Improve monitoring and collection
of colleague ethnicity data including
improvements to new starter
processes
Launch of colleague-led network
and support groups sponsored by
the Leadership Team to promote
and raise awareness of Diversity and
Inclusion such as LGBTQ+ and Women
in Business groups
Extend our provision of work
experience opportunities and
launch CV and interview preparation
workshops led by our colleagues,
for those in our communities with
barriers to employment, and for
students seeking to develop their
employabilityskills
Complete overhaul of retail
uniforms to ensure they meet all
colleagues needs (e.g. menopause,
disabilityfriendly
Group plc Annual Report and Accounts 202334
Sustainability
Continued
We have continued to focus on
colleague wellbeing duringthe last
year, launching our new Wellbeing
and entalealth policy, supported
by an increasing range of associated
policies, resources and activities to
support ourpeople.
We introduced a new Employee
Assistance Programme (EAP), in
partnership with Health Assured, which
offers our colleagues and their families
a free, 24/7/365 confidential telephone
helpline. Each call is handled by a
qualified counsellor or advisor offering
friendly, non-judgemental support
covering a wide range of issues,
including anxiety or stress, personal
relationships, health issues, grief,
bereavements, work pressures and
financial problems.
Colleagues have access to an online
wellbeing portal and a mobile app,
and face-to-face, online or telephone
counselling sessions can be arranged
for those needing extra support.
We have continued to train and develop
our mental health first aiders across
our business including our retail stores
and, headquarters to spot signs of
mental ill health, act as a first point of
call for struggling colleagues, provide
initial support and help facilitate
the provision of additional help
whereneeded.
In January, we launched an Employee
Wellbeing Calendar for 2023 with key
engagement activities throughout
the year for colleagues to participate
in, supported by a range of resources
to aid mental and physical wellness.
All colleagues have access to
additional information which is stored
in a “wellbeing library” within our
Sustainability and Wellbeing portal.
Mental well-being Physical well-being Financial well-being
Mental health first aiders
Wellness room in new
headquarters
Well- being month (January)
Well- being Calendar for 2023,
with key engagement dates
Employee Assistance
Programme (EAP) offers
support for mental
health needs
Onsite gym and running / walking track at
our new headquarters promoting physical
exercise
Healthy eating options at our colleague
canteen
Flexible working where the job allows
Membership to health and fitness app for
colleagues
Good Causes Days enabling colleagues to
participate in outdoor events
EAP provides financial assistance and
guidance
Provision of resources to educate on financial
topics such as personal budgeting and
managing debt
Fair total reward packaging with range of
benefits available to all
Colleague discounts on our products
Discounts arranged with third party retailers to
help colleagues save money on essentials
We continue to prioritise our
colleagues’ health and wellbeing to
improve their mental, physical, and
financial wellbeing. With the cost-of-
living crisis and daily pressures, financial
wellbeing is a high priority which we will
continue to help our colleagues with in
the coming months and years.
Group plc Annual Report and Accounts 2023 35
Wellbeing and Mental Health - case study
Strategic Report
Read more:
Reducing our
environmental
footprint - pages
20 to 21
Read more:
Progressing towards Net
Zero - pages 46 to 47
We aim to reduce our environmental impact through developing and improving operational practices. With a high priority
focus on carbon reduction, waste elimination and the improvement of our environmental management system including our
established environmental and waste policies and processes. We continue to focus on minimising our Scope 1 and 2 carbon
emissions, and having now completed our assessment of total emissions including Scope 3, we are in the process of launching
actions and further developing our roadmap to tackle these.
Responsibility Dan Walden, Chief Financial Officer (CFO)
Link to principal risks Climate change
Brand and customer
Regulatory compliance
Link to strategy
5
Reducing our environmental footprint
Key stakeholders
Customers Colleagues Suppliers
Communities
Link to the United Nations Sustainable Development Goals
Recent recognition, awards, and memberships • B Corp Certification (September 2022)
• BREEAM Excellent Certified new Distribution Centre and
Headquarters
• Woodland Trust Woodland Carbon Partner
• Gold Standard Carbon Offset with Ecologi
• Certified Zero Waste to Landfill (for our Distribution
Centre and Headquarters)
Our Commitments How we deliver on our commitment What we are focused on next
Progress our B
Corp Score and
develop Company
Impact Report
Developed processes, practices, and
policies to improve sustainability and
colleague well- being at ProCook
Ongoing commitment to our relationships in
the local community including our charitable
partner Life’s a Beach
Achieved B Corp certification in September
2022
NEW in FY23
Aligned our activities, targets, and impacts to
the United Nations Sustainable Development
Goals
NEW in FY23
Raising awareness of the importance of the
B Corp initiative with customers through logo
placement in our marketing, on our website
and on our packaging
NEW in FY23
Use our B Corp score as an internal metric to
monitor our improvement in each measurable
area, aiming to achieve >85 points when re-
certifying in FY26
Complete our B Corp Impact Report in FY24 to
show our progress and commitment to being a
socially and environmentally responsible business
Promote our Cycle to Work scheme and car-
sharing schemes to encourage colleagues to
make more sustainable transport choices
Share our experience of best practice within the B
Corp and wider retail community
Strengthen ESG knowledge, skills, and talent
across the business
Our Planet — Reducing our environmental footprint
Group plc Annual Report and Accounts 202336
Sustainability
Continued
Our Commitments How we deliver on our commitment What we are focused on next
Reduce waste and
use sustainable
materials
throughout our
operational
activities
Adhering to the Waste Hierarchy of
prevention, reuse, recycle, recover, disposal.
Certified zero waste to landfill at our
Distribution and HQ sites
Between 2019-2022 we reduced our
packaging by 22% (8 tonnes) despite
significant sales volume growth
Reduced single-use plastic across the
business; all colleagues are provided with
reusable bottles in their starter welcome box
Utilisation of bio-degradable carrier bags to
eliminate plastic waste
Provision of a recycling scheme for small
home electrical items (WEEE waste)
100% FSC-certified cardboard packaging
for home delivery parcels
Reuse and repurpose our used store fixtures
and equipment wherever operationally
possible
Significantly reduced usage of plastic
bubblewrap (by 14.8%), introducing recycled
paper-based box filler
NEW in FY23
Introduced regular audits of product
packaging to further eradicate single-use
plastic. Now, only a small number of products
have any single-use plastic content
NEW in FY23
Introduced waste posters and signage to
raise awareness and enhance recycling
effort
NEW in FY23
Introduce environmental targets for retail stores
and measure improvement
Further eliminate single-use plastic in our
packaging while maintaining the highest health
and safety standards, and avoiding damages
which contribute to waste
Develop our
environmental
framework to
strengthen and
manage our
environmental
procedures and
policies
ESG roles and responsibilities assigned
throughout the business
Appointed external consultancy to
support the implementation of a coherent
Environmental Management System (EMS)
Regularly review and monitor our
environmental risk register, including
climate risks
Completed our first EMS developing our
processes and policies
NEW in FY23
Launched our Executive sponsored ESG
committee, reporting to the Board, to
accelerate action across the business
NEW in FY23
Full alignment with the IS014001 Environmental
Management Framework
Further develop our net zero roadmap,
implementing initiatives with pace
Group plc Annual Report and Accounts 2023 37
Strategic Report
Greenhouse gas
emissions
1
FY19 FY20 FY21 FY22 FY23
1015.6
429.7
447.7
369.9
996.9
tCO
2
/£1m revenue
4.1
1.8
2.1
1.8
4.1
FY19 FY20 FY21 FY22 FY23
Energy Megawatt
hours
26.1
8.0
6.5
5.9
35.9
FY19 FY20 FY21 FY22 FY23
1
CO
2
emissions are defined as
emissions from all Scope 1 and 2
activities relating to the Group’s
operations.
Our Commitments How we deliver on our commitment What we are focused on next
To reduce our
carbon emissions
to Net Zero, in line
with the United
Nations Science
Based Targets
1
initiative
100% LED lighting in our head office and
warehouses, and 95% LED lighting in stores
Carbon-neutral home delivery service with
DPD, andoffset emissions with Ecologi for
Evri deliveries
Partnership with the Woodland Trust to
mitigate Scope 1 and 2 carbon emissions
A fully electric Company car fleet
Moved our distribution centre and
offices to our new highly energy
efficient, BREEAM excellent-certified,
headquarters
NEW in FY23
Further reduced operational energy
consumption through suggested
improvements
NEW in FY23
Developed a long-term carbon reduction
strategy in line with the UN Science Based
Targets initiative
NEW in FY23
External verification of our Scope 1 and 2
carbon emissions with Scope 3 emissions
now fully mapped and understood
NEW in FY23
Completing our transition towards 100%
renewable energy sources (currently at 37% of
locations)
Improving our suppliers T&Cs to incorporate
greater prioritisation to environmental
requirements
Engaging with our suppliers to understand and
positively influence their environmental impact
Improve our workplace pension to offer more
sustainable investments and reduce our Scope 3
carbon emissions
Engaging our colleagues with our net zero roadmap
to deliver our priorities and reduce emissions
Complete ProCook Travel Plan using Travel to
Work Survey data, aiming for a 10% reduction of
single occupancy car journeys to HQ by FY29
Further raising customer awareness of product
choice impacts, educating on the benefits of
buying high-quality, long-lasting products, which
have lower impact due to their longevity
Continue our drive to reduce energy consumption
in our operations
1
The United Nations’ Science Based Targets provide a clearly defined pathway for companies to reduce greenhouse gas (GHG) emissions
andimprove sustainability, helping prevent the worst impacts of climate change.
FSC cardboard
packaging with
recycled paper
void fill
38
Sustainability
Continued
Group plc Annual Report and Accounts 2023
In FY23 we have had a specific focus on
increasing colleague engagement with
the activities and events which Life’s a
Beach undertakes.
During 2022 as a whole we were
pleased to support Life’s a Beach in
completing seven beach-clean events
as well as two canal-clean events
which our colleagues and over 300
volunteers took part in, collecting 142
bags, or 215kg of plastic waste from
UKbeaches.
These events with Life’s a Beach
allow our colleagues to explore local
beaches and canals, enjoying nature
and the outdoors, which is beneficial
for both mental and physical health,
and team building, and have a positive
impact in their local communities.
We were pleased to undertake a
number of events in collaboration
with local community partners such as
universities and Girl Guides groups.
We are pleased to support Life’s a
Beach in their plan to increase their
activity in the coming years, increasing
the frequency of clean-up events,
developing an outreach programme,
and increasing interaction with local
schools to enhance education around
the impacts of plastic pollution and
how to make better choices to reduce,
recycle and reuse.
We work very closely with our chosen
charity partner ‘Life’s a Beach’ to
take positive environmental action,
supporting the eradication of single-
use plastics from British beaches,
educating children on the danger
of litter, and promoting the use of
reusable products.
volunteers took part
bags of rubbish collected from
UK beaches
of plastic waste equivalent
39Group plc Annual Report and Accounts 2023
Life’s a Beach - case study
Strategic Report
Our high-quality products which are built to last are a critical component of our customer proposition, and we design these
with longevity in mind, offering guarantees of up to 25years. We monitor quality rigorously and listen carefully to customer
feedback through Trustpilot product reviews. Our trusted suppliers ensure we provide our customers with the highest
quality, most long-lasting, and ethically produced goods that they expect. We continue to promote and ensure responsible
manufacturing and have increased the number of Sedex members in our supply chain, ending our relationships with suppliers
not able to provide adequate ethical audits.
Responsibility Daniel O’Neill, Chief Executive Officer, and Founder
Link to principal risks Supply Chain
Climate change
Brand and customer
Link to strategy
2
Developing our customer proposition
5
Reducing our environmental footprint
Key stakeholders
Customers Suppliers Communities
Link to the United Nations Sustainable Development Goals
Recent recognition, awards, and memberships • Sedex membership
• B Corp Certification (September 2022)
Reusable melamine outdoor
living and picnic tableware
Our Product — Helping our customers make more sustainable choices
40
Sustainability
Continued
Group plc Annual Report and Accounts 2023
Our Commitments How we deliver on our commitment What we are focused on next
Develop and bring
to market products
which are of high
quality and have
longevity offering
our customers
more sustainable
choices
Offer products with product guarantees of up to
25 years
Continual focus on Quality Assurance to enhance
product quality, reduce fault rates and improve
product longevity
We have removed all single-use plastic products
from ranges and are committed to not selling
suchproducts
Expanded our range of products that include more
sustainable materials, specifically acacia and
bamboo
NEW in FY23
Introduced new Life’s a Beach branded reusable
product ranges in Spring 2023, with proportion of sale
proceeds donated to the charity
NEW in FY23
Launch a recycled product range, with a
98% recycled content to help customers
make better choices
Further improve range structure to
discontinue products with lower longevity
Conduct life cycle assessments on
product ranges to identify input materials
with a lower carbon cost to support our
future product development
Promote
responsible
manufacturing
processes across
our supply chain
with high levels
of transparency
and compliance
in ethical and
environmental
standards
Membership of Sedex (ethical and environmental
compliance monitoring) requiring our suppliers to
register with Sedex or an equivalent body
Achieved 98% supplier registration with Sedex or
equivalent
NEW in FY23
Reviewed and challenged supplier compliance results
ensuring weaknesses or non-compliance issues are
promptly actioned
NEW in FY23
Introduced independent product performance
and chemical testing on all new ranges, and re-
tested all existing core and high-risk product
categories
NEW in FY23
Increasingly influence suppliers to
improve sustainability practices through
our strong relationships
Enhance our supplier T&Cs to
require greater focus on sustainable
manufacturing improvements
Investigate opportunities to reuse or
recycle end of life products helping
improve our circular economy
Continue to focus on product risk
assessments and technical files, ethical
and technical audits, and advances in
sustainable materials
Minimise waste
from product
packaging to
reduce our
environmental
footprint
Eliminated less sustainable materials where
operationally possible, using options like string, paper
ties and tissue paper instead of elastic bands and
single use plastic bags
Reduced average plastic use in product packaging by
24.6% in 2022
Over 95% of our retail product packaging is
plastic-free
Product packaging sign-off process improved to
incorporated environmental assessment
NEW in FY23
Improved product shipping packaging with suppliers
to eliminate waste including moving to paper-based
tapes instead of plastic
NEW in FY23
Improved recycling instructions on product
packaging to support customers in their recycling
efforts
NEW in FY23
Continue to innovate to reduce single-
use plastics in product packaging
Launch an online recycling guide for
customers providing guidance on how
to responsibly dispose of ProCook
packaging
Introduce retail information to better
highlight to customers our commitment
to reducing plastic packaging
Group plc Annual Report and Accounts 2023 41
Strategic Report
In line with the FCA Listing Rule LR 9.8.6R (8), ProCook has made disclosures against the Task Force on Climate-Related
Financial Disclosures (TCFD) recommendations on pages 42 to 45. The Director responsible for climate change as a whole
is Dan Walden (CFO), supported by the Group’s ESG Director and team members. We acknowledge the severity and
immediacy of climate change and corresponding financialrisks.
We continue to make significant progress in how we monitor, measure, and manage climate change risks and opportunities.
We plan to complete our strategy resilience scenario analysis in the year ahead with this being our last remaining area
to achieve full compliance with the TCFD recommendations. Reducing our environmental footprint is deeply rooted
in our cultural values and is key to our long-term success as a brand which customers and colleagues alike, want to be
associated with.
We are aware of growing consumer demand for longer lasting, more sustainable products which are free from single use
plastics, and the associated commercial risks and opportunities this creates. Our peak trading period is typically during the
late autumn and early winter period. Extreme weather events during this time could disrupt our purchasing and flow of stock,
product deliveries to store, customers physically visiting our stores or fulfilment of customer orders for home delivery. To limit
potential disruption, we are developing our operational sustainability strategy and risk management processes in response
to these climate risks andopportunities.
With time, our understanding of climate change impacts, and subsequently our response, will evolve. Our assessment of
climate-related risk will improve accordingly, and we will pursue further initiatives within our ongoing strategy.
Strong governance with oversight by the Board
The Board is responsible for governance across the Group and takes an active role in the oversight of strategy
development, culture and risk management which includes the oversight of ESG matters including climate change.
Read more:
Governance Framework – pages 76 to 77
Board activities – pages 82 to 85
What we do already What we will do next
Climate Change and sustainability topics are discussed
regularly by the Board, with deep dive updates throughout
the year on ESG progress presented by our ESG Director.
Monthly “Green Team” meetings generate ideas and
implement initiatives to reduce our environmental impact.
The Board reviews ESG progress at least every six months
as a standing agenda item with the most recent ESG Board
discussion in January 2023.
The Audit and Risk Committee reviews the principal
risks at least twice a year including those surrounding
climatechange.
Launched an Executive sponsored ESG Committee to
oversee the delivery of our strategic objectives and report
to the Board on progress against targets.
Continue to educate and engage colleagues on B Corp,
climate change and sustainability, through our training
e-platform, regular internal comms and our Sustainability
and Well-being Portal.
Further embed climate related considerations in our
strategic and financial planning as climate change impacts
become more critical to our business practices.
Group plc Annual Report and Accounts 202342
Task Force on Climate-Related Financial
Disclosures (TCFD)
Prioritising climate change in our strategy
We are committed to integrating climate change considerations into our day-to-day business activities and our strategic
objectives. While we recognise that there will be costs associated with investing, implementing, and preventing negative
impacts associated with climate change, we are committed to always doing the right thing and creating a responsible and
resilient business for all stakeholders. The climate-related risks and opportunities that we have identified over the short,
medium and long term are set out in our climate risk register.
The Board has considered the potential impacts to our strategy of climate change risks (as set out on pages 48 to 50, and
page 65). These are not considered to have a material effect on the Group’s financial projections or strategic priorities
over the short to medium term.
Read more:
Climate risk register - pages 48 to 50
Reducing our environmental footprint – page 20
Sustainability: Our planet – pages 36 to 39
What we do already What we will do next
Reducing our environmental footprint is a key element of
our Group’s strategy.
Alignment of our ESG impacts with the United Nations
Science Based Targets initiative to support internal
strategic decision- making and focus.
Developed our environmental management system and
began development of our net zero strategic roadmap
in partnership with carbon consultants to deliver carbon
emissions reduction throughout our business operations
and global supply chain.
Identified eight ESG strategic priority actions for
completion in FY24, approved by the Board in March 2023.
Continue to invest in resource and expertise to support our
transition towards net zero.
Develop and implement the eight FY24 priorities for our
Scope 1, 2 and 3 carbon reduction strategy. Build on our
foundations and demonstrate real progress.
Continue to develop our strategic roadmap to achieve
net zero, including determining the pace at which we can
transition and the tangible initiatives to pursue.
Utilise our relationships with key strategic suppliers to
influence their environmental commitments, targets, and
progress.
Undertake a resilience assessment of our business
strategy, taking into consideration different climate-
related scenarios, including a 2’C or lower scenario.
Group plc Annual Report and Accounts 2023 43
Strategic Report
A robust approach to risk management
Climate change is one of the Group’s principal risks and uncertainties and is integrated with other risks, which together are
overseen and discussed by the Board, the Audit and Risk Committee and Executive team in regular reviews of our principal
risks.
Read more:
Climate risk register - pages 48 to 50
Our approach to risk management - page 58
Principal risks and uncertainties: climate change – page 65
What we do already What we will do next
Clearly defined ESG roles and responsibilities have been
established with regards to environmental management.
Climate risk register developed which incorporates
short, medium, and long-term climate-related risks, with
an assessment of potential climate change risks and
opportunities that could affect our business over the
following time scales: short term (0 to 2 years), medium
term (2 to 5 years) and long term (over 5 years).
Oversight of risk management is delegated to the Audit
and Risk Committee by the Board.
Review and update climate change risk assessments and
have these externally reviewed as risks evolve.
Monitor and identify changes to climate related risk
(increase, no change, decrease), and review this at least
bi-annually with the Board.
Complete a detailed environmental risk assessment for
our global supply chain, with regards to water, biodiversity
loss, physical climatic changes, under different climate
changescenarios.
Group plc Annual Report and Accounts 202344
Task Force on Climate-Related Financial
Disclosures (TCFD) Continued
Monitoring progress through detailed metrics and targets
Setting targets and monitoring progress against these are critical to ensure that sufficient headway is being made at
the required pace. The Board monitors a range of performance indicators including those set our below and our Key
Performance Indicators.
Read more:
Key Performance Indicators – pages 52 to 53
Alternative Performance Measures – pages 164 to 166
What we do already What we will do next
Scope 1, 2 and 3 (over 80% of Scope 3) carbon emissions
assessed and reported to the Board annually.
Company Vehicle fleet: 100% electric.
Waste reduction: Zero Waste to landfill certification of our
head office and warehouse sites.
Sustainable paper: 100% FSC certified paper used across
the business.
Sustainable home delivery packaging: 100% FSC
certified home delivery boxes and paper packaging in use
inoperations.
Greenhouse gas emissions: see further detail on page 38.
Work with our suppliers and carbon consultants to continue
to improve the accuracy and completeness of our carbon
emission data, particularly in respect of Scope 3 emissions.
Develop our Net Zero roadmap and associated targets and
timescales, assessing in further detail the cost / benefit,
pace, and action plan to implement initiatives.
Renewable energy sources: Achieve 100% in direct
operations by FY25 year end
ESOS Phase 3 recommendations to be integrated into net
zero roadmap, identify energy efficiency improvements for
stores.
Investigate the ProCook stores with the highest kWh/sq.ft.
usage to see where improvements can be made in FY24,
aiming to reduce energy consumption by >15% in our worst
performing stores.
Engage with all freight and logistics providers regarding
the GLEC framework, verify their targets which should be
aligned to global target for the logistics sector of Net Zero
by 2040.
Change our workplace pension providers in FY24 to
ensure more sustainable investments and reduce carbon
emissions (Scope 3, Category 15: Investments).
Suppliers: engage with our top 10 product suppliers to
understand their own environmental performance and
action plans.
Deliver on our 8 immediate priority areas: see further detail
on page 47.
Report annually to the Board on carbon emissions to track
and monitor progress towards Net Zero.
Group plc Annual Report and Accounts 2023 45
Strategic Report
Now that we have completed our full
carbon footprint analysis including
our Scope 1, 2 and 3 emissions, we
have gained a full understanding of
the extent of the emissions implicit
in our indirect sourcing activities, as
set out in the value chain analysis on
this page.
These are significant in comparison
to the relatively modest emissions
from our own operations which the
Group has worked hard to eliminate
and reduce over recent years. As a
result of the emissions in our supply
chain not being directly in our control
and being in sectors and countries
where no clear de-carbonisation
plans exist yet, we have had to
revise our own internal expectations
considering the reality of our ability to
influence and improve these indirect
emissions with the pace that we
would like to.
We have begun a detailed exercise
to reassess the timescales on which
we can with confidence commit to
net zero across our value chain as
a whole, and in the meantime we
have set out eight initial priorities to
progress in the next twelve months.
We are committed to making as much
progress as we possibly can with our
suppliers and partners to reduce our
environmentalimpact.
The Board has determined that it
is appropriate therefore to work
to an incremental plan where we
build foundations, demonstrate
progress, and formalise our initiatives
and plans for future progress each
year. Our progress will be very
much dependant on our supplier
relationships and their environmental
targets/actions as wellas
eternalinfluence.
aeaaroootrt
1
ProCook’s
Value Chain
Carbon
Emissions
(tCO
2
e
1
Sourcing products and services
Carbon emissions (tCO
2
e
breakdown
Scope 3
Scope 2
Scope 1
Fabricated metal
products, excl. machinery
and equipment
Glass, ceramics and stone
Basic iron and steel
Other wholesale products
Rubber and plastic products
Wood and wood products
Furniture
Other manufactured goods
Coffee capsules
Computer, electronic and
optical products
Machinery and equipment
tCO
2
e %
Scope 1
41 0.1%
Scope 2
400 1.1%
Scope 3
34,542 98.8%
5010
9
10,739
6,947
4,995
1,650
1,504
1,045
271
200
Sourcing
products
and services
tCO
2
e %
Purchased goods
and services
29,923 85.5%
Capital goods 1,047 3.0%
Fuel and energy 507 1.5%
Sourcing products
and services
31,477 90.0%
90.0%
Upstream
logistics
tCO
2
e %
Transportation
and distribution
2,282 6.5%
6.5%
ProCook
operations
tCO
2
e %
Company facilities 16 0.0%
Company vehicles 25 0.1%
Purchased electricity,
heating and cooling
400 1.1%
Employee Commuting 529 1.5%
Business Travel 55 0.2%
Waste generated in
operations
6 0.0%
ProCook operations 1,031 2.9%
2.9%
Downstream
logistics
tCO
2
e %
Delivery transport 0 0%
0%
Other
tCO
2
e %
Investments 190 0.6%
Leased assets 3 0.0%
Other 193 0.6%
0.6%
1
Emissions data presented relates to
the FY22 baseline year
Group plc Annual Report and Accounts 202346
Progressing towards net zero
Having already made substantial progress in reducing emissions in Scope 1 and Scope 2 through a range of initiatives in
recent years, the Group now has to take steps to tackle the significant emissions in the Scope 3 areas which are not directly
in our control.
Mitigating scope 1 and 2 emissions Mitigating scope 3 emissions
Continue to
improve energy
efficiency
Focusing on
stores, no/low cost
capital expenditure
projects
Electric company
vehicle fleet
100% already
achieved
Carbon mitigation
and offsetting for
hard-to-reduce
emissions
Enhance this with
the Woodland
Trust and Ecologi
Procurement of
100% renewable
energy by year
end FY25
Continue to make
improvements
to product and
packaging
Material selection,
recyclability,
working towards a
circular economy
Supplier
engagement
Develop
relationships
to understand
supplier
consumption and
targets, establish
greater supplier
reporting
Strengthen
environment
policies
Internal and external
policies, including
our EMS
Our 8 immediate priority areas
1
Given the inherent challenges in measuring emissions on indirect activities outside of ProCook’s control, especially those in scope 2 and 3, the
Group has worked with expert carbon consultants making use of best industry practices using judgement and estimates where necessary based on
company and country data. There fore there these emissions lack absolute precision but are considered by the Group to be reasonably indicative,
and will be refined as more precise data becomes available.
Policies
Strengthen and update
environmental and
ESG policies (e.g.
purchasing, energy, waste
management, human rights)
Environmental
management
sste
Improve and fully align
EMS documents to
ISO14001
More efficient property
Improve store efficiencies.
Understand differences in
energy usage of similar size
ProCook stores to make
improvements and reduce
overall energy consumption
Reduce and recycle
packaging
Continue to improve
our product packaging
recyclability and remove
single use plastics
Data quality
Identify operational
data gaps and
improve collection
and management (e.g.
business travel)
Engage suppliers
Identify key suppliers
for initial engagement
and understand their
environmental targets
Travel
Improve WFH and
employee commuting data
and distribute sustainable
travel plans for our new
headquarters
Engagement and
education
Develop a communication
plan informed by a
stakeholder analysis to
engage colleagues and
achieve cross company
commitment
Group plc Annual Report and Accounts 2023 47
Strategic Report
Risk Opportunity
Indicative
timeframe
Link to
principal risks Risk rating
Transition Risks (associated with moving towards a greener, less polluting economy)
Regulatory risks
Increased compliance costs and
reporting obligations. Increasing
extended producer responsibility,
driving operational waste disposal
costs up (for example packaging and
product waste).
Although there may be initial costs,
there are also potential operating
savings from transitioning towards a
more circular business model.
Reduction in single-use plastic
packaging could decrease waste
management costs and improve
recycling rates.
Short/
medium term
Regulatory
compliance
Medium
Risk of higher climate regulatory
requirements, complicating business
practices. Increased costs from
introduction of carbon taxes, as
well as increased taxes for plastics,
energy, waste, and fuel as the UK
Government aims to meet net zero by
2050 alongside other environmental
commitments.
Higher initial costs with new legislation,
possible long-term savings through a
more thorough sustainability strategy
with ambitious targets, improving
ProCook’s environmental management
system, reducing carbon/ energy
consumption and single-use
plastic use.
Medium term Regulatory
compliance
Medium
Higher costs related to legislation
and changes in building efficiency
standards.
Savings from more efficient building
standards (lower heating costs), as
well as opportunity to transition to
predominately renewable energy.
Medium/
Long term
Regulatory
compliance
Low
Technology Risk
To achieve a low carbon future,
and the targets set out in the Paris
Agreement to limit warming to 1.5 °C,
new technological advancements will
be required.
Substitution and transition costs of
shifting to lower emissions products,
services, and technologies.
Long-term cost savings from using
more efficient, economical, and
sustainable products, services,
and technologies. Some of these
technological changes could be driven
by regulation and legislation.
Short/
Medium term
Technology
platforms,
data loss and
cybersecurity
Medium
Internal systems becoming inefficient
/ investments in new technologies
becoming outdated.
Accelerated technology capabilities
could drive operational efficiencies.
Medium/
Long term
Technology
platforms,
data loss and
cybersecurity
Low
Group plc Annual Report and Accounts 202348
Climate-related risk register
Risk Opportunity
Indicative
timeframe
Link to
principal risks Risk rating
Market Risk
Changing consumer behaviour.
Increasing demand for limited but
more sustainable materials (e.g.,
recycled). Harder to source, could
increase manufacturing costs.
Using innovative and alternative
materials may become more cost
efficient. More ranges with these
materials will appeal to sustainability
focused customers and will increase
brand image and reputation.
Our success is dependent on our ability
to adapt to meet the progressing
expectations of our customers.
Consumers are likely to seek more
sustainable product choices as
public awareness of climate change
intensifies.
Short/
Medium term
Brand and
customer
High
Increased costs of raw materials for
product production.
Raw material prices may fluctuate
or increase. Using innovative and
alternative materials in products may
allow us to be more cost efficient.
Short/
Medium term
Competition,
market and
macro-
economic
Medium
Higher demand for products that
align to the circular economy
(reuse and repair), reducing new
product sales and/or loss of sales to
competitors with more sustainable
options.
Demand for sustainable product
ranges and those associated with the
circular economy may increase sales.
Medium/
Long term
Brand and
customer
Medium
Reputational Risk
Unable to recruit and retain top
talent if we are not recognised as a
responsible business.
Continual improvement of
sustainability strategy/ credentials
improves reputation and brand image,
attracting a broader range of talented
and loyal colleagues.
Medium/
Long term
People and
culture
Medium
Shifts in consumer preferences,
unable to retain and attract
customers if we are not recognised as
a responsible business.
Continually improving sustainability
strategy/ credentials will lead to a
better reputation and brand image,
attracting a broader range of loyal
customers.
Medium/
Long term
Brand and
customer
Medium
Increased stakeholder interest in
sustainability may lead to investors
divesting if we are not recognised as a
responsible business.
Continually improving sustainability
strategy/ credentials and enhancing
transparency will lead to easier access
to capital and improved investor
sentiment.
Medium/
Long term
Financial and
treasury
Medium
Group plc Annual Report and Accounts 2023 49
Strategic Report
Climate-related risk register
Continued
Risk Opportunity
Indicative
timeframe
Link to
principal risks Risk rating
Physical Risks (associated with the physical impacts of climate change)
Increased risk of extreme weather
events (heatwaves, storm surges,
drought, flooding, wildfires). Could
lead to disruption within the supply
chain or damage of buildings,
products, and transportation.
Continue to strengthen links with
suppliers and distributors and improve
communication throughout the supply
chain to maximise resilience and
minimise disruption.
Short/
Medium term
Climate
change
Low
Increased risk of extreme weather
events may impact raw material
supply, production, and access.
Changes in precipitation and
temperature can affect the growth of
raw materials in some of our product
ranges including wood and cotton.
Lower supply could increase the cost
of raw materials.
We are reliant on raw materials for our
products. Strengthened links with
suppliers and distributor and improved
communication throughout the supply
chain will improve resilience and
minimise disruption.
Medium/
Long term
Climate
change
Low
Risk from reduced employee
productivity due to infrastructure
disruptions and extremes in weather
(predominantly higher temperatures).
Continue to improve colleague
working environments and improve
communication throughout the
business to improve flexibility,
maximise resilience and minimise
disruption.
Medium/
Long term
Climate
change
Low
Group plc Annual Report and Accounts 202350
Non-financial information
and sustainability statement
In accordance with Section 414CB of the Companies Act 2006, the statements below set out our approach and commitment
to our people, ourcommunities and environment, anti-bribery and corruption, and human rights across the Group.
Additional information on our business model can be found on pages 4 to 5, our approach to risk management on page 58,
and our non-financial KPIs on pages 52 to 53.
Our people
We are committed to creating an even better place to
work for our people, with a safe working environment and
a supportive culture where our colleagues can develop
their skills, experience, and careers. We promote wellbeing,
inclusion, diversity, and equal opportunities, and we treat
everyone with respect, providing fair reward for each of their
contributions. Our leadership play a critical role in fostering
and developing our culture and our working environments,
which is why we’re committed to developing the best
possible leaders we can.
Read more: ur communities and environment:
Creating an even better place to work: pages 18 to 19
Engaging with our people: page 22 to 27
Sustainability – people: pages 31 to 35
Code of conduct: see www.procookgroup.co.uk
Gender pay gap: see www.procookgroup.co.uk
Diversity, equality, and inclusion policy:
see www.procookgroup.co.uk
Mental Health and well- being policy:
see www.procookgroup.co.uk
rotesaderoet
ProCook is committed to supporting the communities in
which we operate. We offer all colleagues the opportunity to
contribute to their communities through our Good Causes
Day scheme. We also raise funds for and promote our charity
partner Life’s a Beach and we develop relationships in our
local communities providing mentoring and work experience
opportunities for people with barriers to work.
We are proactive in our activities to reduce our impact
on the environment. We source quality products that are
designed to last, helping customers make more sustainable
choices and we eliminate all unnecessary plastics from our
packaging. We operate a zero waste to landfill headquarters
site, and we are committed to progressively reducing our
emissions across all of our operations and supply chain.
Read more: ur communities and environment:
Reducing our environmental footprint: page 20
Engaging with our communities: page 26
Sustainability – communities: page 33
Sustainability – planet: pages 36 to 39
Our BREEAM Excellent-rated distribution centre
and headquarters: page 19
Anti-bribery and corruption,
adarts
ProCook is committed to doing the right thing, with robust
policies and procedures in place to prevent bribery,
corruption, and human rights abuse.
We have established controls around giving and receiving
hospitality, entertainment, and gifts, and around the
introduction of new supplier partners. Colleagues are
required to confirm on an annual basis their understanding
of the policies that we have in place around anti-bribery and
corruption, and any non-compliance with the policy would
result in disciplinary action and possible dismissal.
We are committed to a zero-tolerance policy on modern
slavery, and we expect both those who work within our
organisation and our external partners to adhere to and
respect the highest ethical standards in working conditions.
The provenance of our products is of paramount importance
to us, and we work closely with our suppliers, staff, and
contractors to ensure there is complete transparency in
labour conditions at every level of our business and stage
of a product’s lifecycle. As part of our Modern Slavery
framework, we continue to audit and monitor the conditions
of our supply chain and internal ecosystem on an ongoing
basis to identify improvements and uphold our commitment.
We operate a whistle-blowing helpline for colleagues who
may be concerned about these and other topics, and who
may prefer to report in confidence. All whistle-blowing
contacts are shared with the Audit & Risk Committee for
oversight and further investigation if required.
Read more: ur policies on anti-bribery and corruption and
humanrights:
Code of conduct: see www.procookgroup.co.uk
Anti-bribery and corruption: see www.procookgroup.co.uk
Modern slavery: see www.procookgroup.co.uk
Sustainability – product: pages 40 to 41
Group plc Annual Report and Accounts 2023 51
Strategic Report
Key Performance Indicators
Our Key Performance Indicators (KPIs) are set and monitored by the Board to assess performance across a range of financial and non-
financial targets and to help determine senior management remuneration.
Financial Customer
Total Revenue
£m and %
Gross profit
£m and %
Underlying profit
before tax
1
£m and % of revenue
Free cash flow
2
£m
Number of new
customers
(‘000)
Number of active
stoers
(‘000)
12 month repeat rate
%
Trustpilot score
(Max 5)
Colleague
engagement score
%
CO
2
emissions intensity
3
tCO
2
/ £1m of revenue
FY20 FY21
£38.8m
39.5%
£53.4m
37.5%
£69.2m
29.5%
£62.3m
(9.9)%
FY22 FY23
FY20 FY21
£23.8m
61.2%
£35.9m
67.2%
£45.0m
65.1%
£38.3m
61.5%
FY22 FY23
£1.7m
4.3%
£8.3m
15.5%
£9.5m
13.7%
£(0.2)m
(0.3)%
FY20 FY21 FY22 FY23
£1.0m
£8.2m
£(3.0)m
£(0.5)m
FY20 FY21 FY22 FY23
FY20 FY21
363
417
723
692
FY22 FY23
Total revenue of £62.3m
(-9.9% vs FY22) reflects
the challenging macro-
environment, the partial
reversal of strong
pent-up demand post
Covid-19 and strong
comparatives from
the prior year, and the
decisions taken to
exit Amazon channels
(-4.9% point impact).
Why this measure
matters
Total Revenue is an
important indicator of
how successful we have
been in attracting and
retaining customers,
and offering high
quality, great value
products accompanied
by excellent
service across all of
ourchannels.
Link to strategy
1 2
Gross profit reduced to
£38.3m (FY22: £45.0m)
driven by the combined
impacts of lower sales
(-£4.5m impact) and
higher supply chain
costs, largely relating
to marine freight costs
of inventory (-£2.2m
impact).
Why this measure
matters
This measures our
success in sourcing
high quality products
which offer customers
great value (with pricing
targeting savings of
at least 30% less than
comparable products
from competitor
brands), while still
achieving strong gross
margins to support the
business model.
Link to strategy
2 3
Underlying Profit
Before Tax reduced to
a loss of £0.2m in FY23
(FY22: profit of £9.5m)
reflecting the lower
sales performance and
gross profit margins,
and the inflationary
pressures within the
Group’s overhead
cost base.
Why this measure
matters
This measure highlights
the underlying
profit performance
of the Group and
demonstrates our
ability to deliver long
term profitable growth.
Link to strategy
2 3
Free cash outflow of
£0.5m in FY23 (FY22:
£3.0m outflow) reflects
careful management
of cash during a
year of significant
investment with net
capital expenditure of
£5.2m (FY22: £3.8m)
partly offset by a £3.8m
inflow from net working
capital (FY21: £3.2m
outflow) as we reduced
inventory levels as the
global supply chain
disruption from the
prior year eased.
Why this measure
matters
Free cash flow
demonstrates the
Group’s ability
to generate cash
inflows which can
then be utilised to
invest in initiatives
to support future
growth, repayment
of debt facilities or to
return surplus funds
via distributions to
shareholders.
Link to strategy
2 3
The Group attracted
692,000 new
customers to shop with
ProCook during FY23,
4.3% less than in FY22
primarily due to lower
Ecommerce revenues.
New customers are
those who shopped
with ProCook for
the first time in the
year and at that point
first registered their
customer details on our
customer database.
Why this measure
matters
Attracting new
customers to shop with
ProCook is a strategic
priority in order to
grow brand awareness
in the UK. The Board
monitors this measure
as an indicator of the
effectiveness of the
Group’s marketing
activities and the
continued progress
being made to raise
awareness of the
ProCook offer.
Link to strategy
1
During FY23 the
number of active
customers in the last
12months increased to
991,000 (+1.8% YoY)
as we continued to
attract new customers
and drive repeat sales.
Of these customers,
299,000 were repeat
customers originally
acquired in previous
periods (FY22:
251,000).
Why this measure
matters
This measure of
the Group’s active
customer database
is important as an
indicator of continued
penetration into the
markets we operate in.
This database allows
ProCook to understand
shopping behaviours
and better target
marketing activities
Link to strategy
1
Our customer’s
12month repeat rate
decreased by 1.9%
points year on year
to 23.6% largely
reflecting the market-
driven channel shift
back towards Retail
which has historically
had a lower repeat
frequency. Retail
repeat rates increased
year on year, while
Ecommerce repeat
rates slowedslightly.
Why this measure
matters
We use this metric
to understand the
Group’s ability to retain
customers and as an
indicator of the Group’s
ability to increase
the life time value of
customers.
Link to strategy
1
During the year we have
retained our excellent-
rated Trustpilot score
with over 95,000
reviews now received
by the Group of which
over 85,000 are
five-star ratings. Our
score dropped by 0.1
point largely due to
the impact of courier
disruption caused by
the Royal Mail strikes
during the Peak
tradingperiod.
Why this measure
matters
The Group uses the
Trustpilot review
service to gain
valuable customer
service and product
feedback. These
reviews provide other
customers confidence
in our overall brand
proposition.
Link to strategy
1 4
Our most recent
colleague engagement
survey result which
was completed in
November 2022 had
an overall engagement
score of 66% which
was down year on
year. Survey feedback
highlighted the
concerns colleagues
had around the
significant financial
pressures caused by
the cost of living crisis.
Why this measure
matters
This is important to us
as colleague feedback
helps us to understand
what we are doing
well and what we
need to improve. Our
colleagues are key to
our long term success.
Link to strategy
2 4
Link to sustainability
Our people
CO
2
emissions intensity
reduced further in
FY23 to 5.9 tonnes
of CO
2
per £1m of
revenue generated
driven by the Group’s
continued focus on
energy reduction
initiatives and transition
towards green energy
supply. This shows
continued improvement
in our sustainability
performance in line with
our ambition to reduce
our environmental
footprint.
Why this measure
matters
ProCook is committed
to doing the right
thing, and reducing
our environmental
footprint is a key part
of this. This measure
highlights how well
we’re doing in reducing
harmful greenhouse
gasemissions.
Link to strategy
3 5
Link to sustainability
Our planet
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
APM
APM
Group plc Annual Report and Accounts 202352
These KPIs provide a range of information aligned to the Group’s strategic mission to be the customers’ first choice for
kitchenware, with our sustainability goals and financial performance in mind. They include people and environmental measures
which the Board consider critical to ensure we remain a great place to work for our colleagues, and that we continue to take
action to reduce our environmental footprint.
Customer Environmental Social Governance
Total Revenue
£m and %
Gross profit
£m and %
Underlying profit
before tax
1
£m and % of revenue
Free cash flow
2
£m
Number of new
customers
(‘000)
Number of active
stoers
(‘000)
12 month repeat rate
%
Trustpilot score
(Max 5)
Colleague
engagement score
%
CO
2
emissions intensity
3
tCO
2
/ £1m of revenue
FY20 FY21
482
557
974
991
FY22 FY23
FY20 FY21
17.1%
18.6%
25.5%
23.6%
FY22 FY23
FY20 FY21
4.8
4.8
4.8
4.7
FY22 FY23
FY20 FY21
n/a
n/a
77%
66%
FY22 FY23
FY20 FY21
26.1
8.0
6.5
5.9
FY22 FY23
Total revenue of £62.3m
(-9.9% vs FY22) reflects
the challenging macro-
environment, the partial
reversal of strong
pent-up demand post
Covid-19 and strong
comparatives from
the prior year, and the
decisions taken to
exit Amazon channels
(-4.9% point impact).
Why this measure
matters
Total Revenue is an
important indicator of
how successful we have
been in attracting and
retaining customers,
and offering high
quality, great value
products accompanied
by excellent
service across all of
ourchannels.
Link to strategy
1 2
Gross profit reduced to
£38.3m (FY22: £45.0m)
driven by the combined
impacts of lower sales
(-£4.5m impact) and
higher supply chain
costs, largely relating
to marine freight costs
of inventory (-£2.2m
impact).
Why this measure
matters
This measures our
success in sourcing
high quality products
which offer customers
great value (with pricing
targeting savings of
at least 30% less than
comparable products
from competitor
brands), while still
achieving strong gross
margins to support the
business model.
Link to strategy
2 3
Underlying Profit
Before Tax reduced to
a loss of £0.2m in FY23
(FY22: profit of £9.5m)
reflecting the lower
sales performance and
gross profit margins,
and the inflationary
pressures within the
Group’s overhead
cost base.
Why this measure
matters
This measure highlights
the underlying
profit performance
of the Group and
demonstrates our
ability to deliver long
term profitable growth.
Link to strategy
2 3
Free cash outflow of
£0.5m in FY23 (FY22:
£3.0m outflow) reflects
careful management
of cash during a
year of significant
investment with net
capital expenditure of
£5.2m (FY22: £3.8m)
partly offset by a £3.8m
inflow from net working
capital (FY21: £3.2m
outflow) as we reduced
inventory levels as the
global supply chain
disruption from the
prior year eased.
Why this measure
matters
Free cash flow
demonstrates the
Group’s ability
to generate cash
inflows which can
then be utilised to
invest in initiatives
to support future
growth, repayment
of debt facilities or to
return surplus funds
via distributions to
shareholders.
Link to strategy
2 3
The Group attracted
692,000 new
customers to shop with
ProCook during FY23,
4.3% less than in FY22
primarily due to lower
Ecommerce revenues.
New customers are
those who shopped
with ProCook for
the first time in the
year and at that point
first registered their
customer details on our
customer database.
Why this measure
matters
Attracting new
customers to shop with
ProCook is a strategic
priority in order to
grow brand awareness
in the UK. The Board
monitors this measure
as an indicator of the
effectiveness of the
Group’s marketing
activities and the
continued progress
being made to raise
awareness of the
ProCook offer.
Link to strategy
1
During FY23 the
number of active
customers in the last
12months increased to
991,000 (+1.8% YoY)
as we continued to
attract new customers
and drive repeat sales.
Of these customers,
299,000 were repeat
customers originally
acquired in previous
periods (FY22:
251,000).
Why this measure
matters
This measure of
the Group’s active
customer database
is important as an
indicator of continued
penetration into the
markets we operate in.
This database allows
ProCook to understand
shopping behaviours
and better target
marketing activities
Link to strategy
1
Our customer’s
12month repeat rate
decreased by 1.9%
points year on year
to 23.6% largely
reflecting the market-
driven channel shift
back towards Retail
which has historically
had a lower repeat
frequency. Retail
repeat rates increased
year on year, while
Ecommerce repeat
rates slowedslightly.
Why this measure
matters
We use this metric
to understand the
Group’s ability to retain
customers and as an
indicator of the Group’s
ability to increase
the life time value of
customers.
Link to strategy
1
During the year we have
retained our excellent-
rated Trustpilot score
with over 95,000
reviews now received
by the Group of which
over 85,000 are
five-star ratings. Our
score dropped by 0.1
point largely due to
the impact of courier
disruption caused by
the Royal Mail strikes
during the Peak
tradingperiod.
Why this measure
matters
The Group uses the
Trustpilot review
service to gain
valuable customer
service and product
feedback. These
reviews provide other
customers confidence
in our overall brand
proposition.
Link to strategy
1 4
Our most recent
colleague engagement
survey result which
was completed in
November 2022 had
an overall engagement
score of 66% which
was down year on
year. Survey feedback
highlighted the
concerns colleagues
had around the
significant financial
pressures caused by
the cost of living crisis.
Why this measure
matters
This is important to us
as colleague feedback
helps us to understand
what we are doing
well and what we
need to improve. Our
colleagues are key to
our long term success.
Link to strategy
2 4
Link to sustainability
Our people
CO
2
emissions intensity
reduced further in
FY23 to 5.9 tonnes
of CO
2
per £1m of
revenue generated
driven by the Group’s
continued focus on
energy reduction
initiatives and transition
towards green energy
supply. This shows
continued improvement
in our sustainability
performance in line with
our ambition to reduce
our environmental
footprint.
Why this measure
matters
ProCook is committed
to doing the right
thing, and reducing
our environmental
footprint is a key part
of this. This measure
highlights how well
we’re doing in reducing
harmful greenhouse
gasemissions.
Link to strategy
3 5
Link to sustainability
Our planet
APM
1
Further information on how Underlying Profit Before Tax is calculated is set out on page 165.
2
Read more on how Free cash flow is calculated on page 166.
3
CO
2
emissions are defined as emissions from all Scope 1 and 2 activities relating to the Group’s operations.
APM
Group plc Annual Report and Accounts 2023 53
Strategic Report
Trading performance has been challenging
over the last financial year, with revenue
excluding the discontinued Amazon
channels declining by 5.0%, margins under
pressure from heightened freight costs
and foreign exchange, and inflationary
pressures impacting our cost base.
We have carefully managed our cash
flows, while still investing in the areas
which will support improved operational
performance and profitability in the years
ahead, and we have reduced costs which
will benefit the current financial year and
beyond.”
Dan Walden
Chief Financial Officer
CFO’s Review
Revenue
£m / %
FY23
£m
YoY growth
%
Yo3Y growth
%
Revenue 62.3 60.0%
Ecommerce 25.6 (20.7%) 77.1%
Retail 36.7 (0.4%) 49.9%
LFL Revenue 54.1 112.2%
Ecommerce 24.9 (11.0%) 207.6%
Retail 29.2 (10.4%) 52.5%
Total revenue in FY23 (the 52-week period ending 2 April
2023) reduced by 9.9% to £62.3m (FY22, the 52-week
period ending 3 April 2022: £69.2m). This included a £3.4m
or 4.9 percentage point reduction in revenue in respect of
discontinued Amazon channels. Compared to FY20 pre-
pandemic, total revenue remains 60.0% ahead, reflecting
like for like growth of 112.2%.
We have broadly maintained our share in the UK Kitchenware
market, which as a whole, has experienced a significant
shift in sales mix back towards physical Retail stores (from
Ecommerce channels) compared to the last financial year.
Based on Euromonitor’s total UK kitchenware market size for
the 2022 calendar year
1
, we estimate that our share of the
market remained similar year on year at 1.85% (2021: 1.90%),
and broadly flat year on year for the financial year ended
2April 2023.
2
Ecommerce revenue decreased by 20.7% to £25.6m (FY22:
£32.3m) including the £3.4m impact of lower sales year on
year from the discontinued Amazon channels. Revenue from
our own website channels declined by 11.0% year-on-year,
remaining 207.6% compared to pre-pandemic performance
in FY20, driven by the challenging macro trading
environment and the market-wide return of customers to
physical retail stores throughout the year.
Retail revenue was broadly flat year on year, declining by
0.4% to £36.7m (FY22: £36.8m), benefiting from the eight
new stores opened last year and the three new stores
opened in the year. Like for like Retail revenue was down
10.4% year on year against strong comparatives due to
pent up demand post Covid-19 restrictions, and was also
impacted by consumer spending which impacted customer
conversion rates. Compared to FY20 pre-pandemic, on
a like for like basis, revenue in existing stores remained up
52.5%. The three new stores openings in the current year
increased our UK Retail estate to stores.
1
Euromonitor “Homewares in the UK report” April 2023. The 2021 UK
Kitchenware market size has been revised upwards, to £3.9bn from
£3.4bn as reported in April 2022.
2
Management estimates based on internal sales data and GFK weekly
kitchenware sales data.
Group plc Annual Report and Accounts 202354
Gross profit
Gross profit of £38.3m in FY23
(FY22: £45.0m) reflected the
lower revenue performance and
was compounded by lower gross
margins of 61.5% (FY22: 65.1%)
which were driven by the heighted
costs of marine freight (-270 bps
impact), adverse foreign exchange
movements (-130 bps impact) in
costs of goods sold, and higher
levels of promotional activity to
support revenue performance (-20
bps impact). These adverse effects
were partly offset by selling price
increases which were carefully
applied and monitored throughout
the year (+70 bps impact).
erateesesadoteroe
Underlying operating expenses net of other income
Total underlying operating expenses net of other income
were £37.6m (FY22: £35.9m) representing 60.3% of sales
(FY22: 51.9%). This growth in costs was driven by a number of
key factors:
• Existing store rent and rates
3
uplifts: +£1.3m
• Expenses in relation to the 3 new stores opened this year
and the annualisation of the net six new stores opened last
year: +£2.0m
• Increased digital marketing costs: +£1.1m
• Annualisation of plc expenses including the Board and
professional fees: +£1.1m
• Central cost inflation and investment: +£0.5m
• Partly offset by lower costs in the Amazon marketplace
channels (UK and EU) and website volume-related
savings: -£3.1m
• Partly offset by lower marketing spend: -£1.0m
3
Retail costs benefitted in the prior year from the property rates ‘holiday’
by approximately £1.3m. This temporary relief came to an end in
April 2022.
Other income
Total other income of £0.1m in FY23 (FY22: £0.4m) related
solely to rentalincome.
In the prior year, £0.4m of other income was reported
in respect of the final elements of the Government’s
Coronavirus Job Retention Scheme and Business Rates
Relief scheme which came into effect during the pandemic
while our stores (as ‘non-essential’ retail stores) were closed
for significant periods of time. These have been included in
the above explanations on a net basis as they relate directly
to operating costs in relation to our Retailstores.
Non-underlying operating expenses
It is the Group’s policy to disclose separately such items
that relate to non-recurring events and are material in nature,
and incurred outside of the normal business operations,
in order to provide a consistent and comparable view of
the underlying performance of the Group. Non-underlying
operating epenses in F23 were 6.2m F22:.m.
Consistent with FY22, expenses in respect of employee
share-based awards which relate to the IPO event in that
year, which itself is non-recurring, have been presented as
non-underlying costs. These expenses amounted to £1.2m in
the year ended 2 April 2023 (FY22: £6.7m). These expenses
are expected to continue through relevant vesting periods
to FY25.
During the year ended 2 April 2023, the Group consolidated
its head office and warehouse operations into a new site.
Non-underlying operating expenses associated with
occupying the site while its development was completed,
and transitioning into the new site during the year were
£0.7m. A smaller residual expense is expected in FY24 as the
transition fully completes.
The Group’s impairment assessment has resulted in an
expense to the Consolidated Income Statement of £3.3m
(2022: £nil) in respect of Retail CGU impairment and £1.1m
(2022: £nil) in respect of the Group’s two pre-existing
distribution / head office sites. Further detail of this
impairment assessment is set out on pages 128 to 129.
In FY22, non-underlying items included expenses of £2.7m
in relation to the IPO.
Oslo
stoneware range
Group plc Annual Report and Accounts 2023 55
Strategic Report
CFO’s Review
Continued
Operating profit
Total underlying operating profit for the period was £0.8m
(FY22: £9.2m). Ecommerce operating profitability declined
from 24.9% of revenue to 17.9% impacted by the lower gross
profit margins, and higher costs of customer acquisition
year on year. Retail profitability reduced from 26.2% of
revenue to 14.5%, driven by the lower sales performance
and gross profit margins year on year, and the impact of
increased rates costs, which benefitted from relief in the
prior year. The total operating profit from our Ecommerce
and Retail channels combined was £9.9m (FY22: £17.7m).
Central costs increased by £0.6m year on year driven by full
year annualisation of plc and board costs and wage inflation,
partly offset by lower brand marketing spend year on year.
£m FY23 FY22
Underlying operating profit
Ecommerce 4.6 8.1
Retail 5.3 9.6
Central costs (8.5)
Total 0.8 9.2
Underlying operating profit % of revenue
Ecommerce 17.9% 24.9%
Retail 14.5% 26.2%
Central costs (12.3%)
Total 1.2% 13.3%
Total reported operating loss, after the £6.2m of non-
underlying expenses set out above was £5.4m (FY22:
£0.2m).
Profit and earnings per share
Underlying loss before tax was £0.2m (FY22: Underlying
profit before tax of £9.5m).
During the year there was an expense of £1.1m (FY22: £0.3m
gain) in respect of financial items in the period. Financial
items included interest expenses on lease liabilities and
borrowings of £1,065k (FY22: £623k), and other losses in
respect of foreign exchange of £55k (FY22: £944k gain).
After non-underlying costs, loss before tax was £6.5m (FY22:
£0.1m profit before tax). Reported loss after tax was £4.9m
(FY22: £0.1m).
The effective tax rate based on underlying profit before tax
was 17.6% (FY22: 20.0%).
Earnings per Share
Underlying basic earnings per share for the year decreased
to -0.12 pence (FY22: 7.34 pence) and underlying diluted
earnings per share decreased to -0.12 pence (FY22: 6.76
pence).
Reported basic earnings per share and reported diluted
earnings per share for the year were -4.53 pence (FY22:
-0.01 pence).
Cash generation and net cash/ debt
We have carefully managed our cash position during the
year, preserving cash in the business while investing in the
areas that will support our long term growth. During the
year we improved our free cash outflow by £2.5m to £0.5m
(FY22: outflow of £3.0m) and ended the year with net debt
of £2.8m (FY22: net debt £1.8m), with available liquidity
headroom of £13.2m (FY22: £14.2m).
£m FY23 FY22
Reported profit before tax 0.1
Depreciation, amortisation,
impairment, and profit/loss on
disposal 9.5 4.1
Share based payments 1.1 5.8
Finance expense 1.1 0.6
Unrealised FX (gains)/losses 0.5 (1.1)
Net working capital 3.8 (3.2)
Tax paid (2.0)
Net operating cash flow 9.3 4.3
Net capital expenditure (3.8)
Interest (0.6)
Payment of lease liabilities (2.9)
Free cash flow
Movement in borrowings (2.7)
Proceeds from the issue of shares - 0.1
Dividends paid (1.9)
Movement in cash and cash
equivalents
£m FY23 FY22
Cash and cash equivalents 2.0 3.8
Borrowings (5.5)
etetas
The lower reported profit before tax in the year includes
£6.2m of non-underlying expenses which resulted in £0.7m
of additional cash outflows (FY22: £2.2m).
A reduction in net working capital resulted in a cash inflow
of £3.8m in the year (FY22: £3.2m outflow) reflecting our
planned reduction of inventory. Inventory on hand at the
year-end (excluding inventory in transit) was £9.5m (FY22:
£15.2m) down 37.5% year on year. Total inventory at the year-
end was £11.5m (FY22: £16.8m).
Net capital expenditure of £5.2m in the year primarily related
to the investment in the new distribution centre and HQ,
and three new stores and two upsized relocation stores
which opened during the year. In the prior year, net capital
expenditure of £3.8m largely related to the eight new store
openings and the ProCook Cookery School.
There was £0.1m of corporation tax paid in the year reflecting
the Group’s lower profitability (FY22: £2.0m). As at 2 April
2023, we had a current tax asset of £0.6m (FY22: £0.3m).
Group plc Annual Report and Accounts 202356
Banking agreements
The Group has access to a committed £10m Revolving
Credit Facility (RCF) to provide additional cash headroom to
support operational and investment activities. This facility
expires in April 2025 and has a one-year extension option
available to extend the term to April 2026. Additionally, the
RCF agreement provides an accordion option, subject to the
lender’s approval, to extend the facility by a further £5m.
Shortly after the year-end, on the 5 May 2023, the Group
successfully finalised an amendment to the RCF terms in
respect of the fixed charge cover covenant which had been
agreed with HSBC during March 2023, in order to provide
additional headroom against that covenant given that the
Group’s EBITDA performance declined during the year and
would have breached the covenant test at the FY23 Q4
test date. The revised test requires EBITDAR to be no less
than 1.25x fixed charges for the FY23 Q4 and FY24 Q1 test
dates, and 1.40x thereafter. The leverage coverage remains
unchanged with net debt to be no greater than 2.0x EBITDA.
Both covenants are tested quarterly and are calculated on a
last twelve month rolling, pre-IFRS 16 basis.
The Group’s ability to meet these covenants has been stress
tested as part of going concern and viability considerations,
which is described in more detail on pages 126 to 128, and
72 to 73 respectively.
The Group has retained its access to an existing £6.0m trade
finance facility, which is due to expire on 23 September
2023, although is expected to be renewed at that date.
There are no covenants associated with this facility. The
terms of this facility are consistent with normal practice.
Capital allocation and dividend policy
In normal circumstances, the Board currently believes that,
to ensure operating flexibility through the business cycle, it
must maintain a minimum unrestricted cash / debt headroom
which the Board reviews on an annual basis, or more
frequently as required. Maintaining this headroom provides
a level of flexibility sufficient to fund the working capital
and investment needs of the Group (as well as set aside an
appropriate operating reserve for unexpected events).
The Group’s dividend policy targets an ordinary dividend
pay-out ratio of 20% to 30% of profit after tax during the
financial year to which the dividend relates. The Board
anticipates, under normal circumstances, that it will consider
returning surplus cash to shareholders if average cash / debt
headroom over a period consistently exceeds the minimum
headroom target, subject to known and anticipated
investment plans at the time.
Read more:
The full capital and dividend policy is available on the Group’s
website at www.procookgroup.co.uk.
Dividends
During the first half of the year ended 2 April 2023, the
Group paid the final dividend in respect of FY22 of 0.9p per
share. Dividend waivers by the O’Neill family shareholders,
to preserve cash within the business, reduced the total
dividend paid by £0.6m to £0.3m.
Due to the ongoing challenging consumer environment and
the uncertainty that it creates around trading performance,
and therefore taking a cautious and responsible decision
to preserve cash within the business during these times, the
Board have not recommended any final dividend in respect
of FY23.
Treasury Management
The Group is exposed to foreign currency risk through its
trading activities. The main source of this relates to stock
purchases from non-UK suppliers, which accounts for
approximately 95% of the Group’s annual stock purchases.
To manage the exchange rate risk, a mixture of standard
(“vanilla”) forwards and outperformance trades are utilised.
The Group seeks target levels of coverage for future USD
payments, as determined by internal forecasts and the
Group’s Treasury Management Policy.
Given the level of USD transactions and cover obtained via
financial instruments, the Group is exposed to a counter-
party risk with each of the financial institutions where
arrangements are held. The Group manages this risk by
ensuring only highly credited institutions are used and
limiting the level of exposure with each.
The Group is also exposed to interest rate risk where the
Group has financial obligations that give rise to a variable
interest charge. To minimise the charges and exposure
driven by interest rates, the Group ensures that credit
facilities are used optimally in parallel with the latest interest
rate information and forecasts.
Tax Strategy
The Group’s tax policy is to manage its tax affairs in a
responsible and transparent manner in line with our
commitment to high corporate governance standards. This
ensures the Group complies with the relevant legislation and
has due regard to our reputation and thus seek to promote
the long-term success of the Group and deliver sustainable
shareholder value.
Read more:
A full copy of the Tax Strategy is available on the Group’s
website at www.procookgroup.co.uk.
Dan Walden
Chief Financial Officer
27 June 2023
Group plc Annual Report and Accounts 2023 57
Strategic Report
Risk Management
During the year we have faced continued rapid and impactful changes in the macro- environment which, combined with
the Group’s ambitions to continually develop and deliver profitable growth, highlights the importance of developing and
maintaining effective risk management processes. During the year we have continued to develop our internal controls and
our risk management framework to enhance our ability to manage risk.
Identification: Risks are identified through both a top-down
approach (strategic risks) as well as a bottom up (functional risks)
approach. Principal risks are identified by the Board and risk
appetites are considered and set. Functional risks are identified
by LT members or delegates. The focus is on risks the Board is
willing to take to achieve its strategic business objectives. New
and emerging risks are assessed and determined. The procedure
seeks to identify top-down strategic risks and well as bottom-up
operational risks.
Assessment: Strategic risks are assessed on at least a 6 monthly
basis during LT meetings. The principal risks are revisited and if
necessary, updated on a semi-annual basis, in line with the financial
reporting timetable. Functional risks are assessed by the LT members
or delegates, through maintenance of the risk and control register.
The risk and control register is reviewed for completeness and
adequacy on a regular basis and included in the LT meeting agendas.
The Board will complete an annual horizon scanning exercise.
Management: Risks are recorded in the Risk Register by LT
members or delegates (risk owners). Every risk on the register is
allocated to an individual and appropriate controls are identified.
Risk management is embedded in the operations and Group
functions. The process allows colleagues and the Board to monitor
risk, as well as demonstrating a shared responsibility for the
management ofrisks.
Review: Each Audit and Risk Committee meeting receives an
update on risk management across the Group and no less than
once a year the Board carries out a review of the risk management
process and assesses whether any improvements are necessary.
The Board re-evaluates risks measures and determines if controls
are appropriate, taking into account business planning. The Board
completes an annual review of risk appetite.
Communication and Training: The Board, LT, operational and Group
functions receive training and support, utilising external resources
asappropriate.
Reporting: The Risk Registers and management of risk is monitored
and reviewed as part of the LT meeting cadence. Reports over
strategic risks and functional risks are generated periodically on
no less than a semi-annual basis with support from the Finance
team / Internal Audit to the LT and from the LT to the Audit and Risk
Committee and the Board.
Approach to risk management
Risk management is an integral part of the
overall governance and management of the
Group, and we continue to develop our risk
management framework and associated
processes. The Board is ultimately responsible
for determining the strategic risks the Group
is willing to take to achieve its strategic
objectives and enhance the sustainability of
value creation, including risks which threaten its
business model, future performance, solvency,
or liquidity. The Board takes a balanced view on
risk to ensure an appropriate position between
risk aversion, opportunity, andgains.
The Audit and Risk Committee, with delegated
authority from the Board, is responsible for
the oversight of the Group’s risk management
processes and controls. The Executive
Directors and Leadership Team (“LT”) have
responsibility for day-to-day risk management
activities, processes, and controls in their
respective functions, and support the Audit and
Risk Committee in executing their responsibility
by ensuring that control processes are
operating effectively, risks are being identified
and monitored, and changes in the risk
environment are being considered.
The Group’s approach is set out in our Risk
Management Policy which is reviewed annually
by the Board to ensure it remains relevant
and appropriate. The risk management and
control procedures set out in this policy form
part of the Group’s normal management and
governance processes:
Read more:
The Group’s Risk Management
Policy is available at
www.procookgroup.co.uk
Group plc Annual Report and Accounts 202358
Risk management framework
Board
Audit and
Risk Committee
Executive Directors
and Leadership Team
Risk
process owners
Ultimately responsible
for the Group’s risk
management system and
reviewing its effectiveness
• Establishes and
communicates
the Group’s Risk
Management Policy
• Sets the tone and culture
for managing risk across
the Group
• Reviews overall Group
principal risks at least
annually
• Sets the risk appetite of
the Group
• Ensures responsibility
for specific risks are
allocated to individual
Executive Directors
• Performs an annual
horizon- scanning
exercise for
emerging risks
• Considers
recommendations
from the Audit and Risk
committee
Responsible for the
oversight of risk
management processes
and controls
• Examines and reviews
the Group’s risk register
and internal control
environment at least
twice a year
• Reports to the Board
on the status of the risk
management processes
• Provides guidance
on risk and control
improvements
• Highlights where
minimum expected
standards are not met
• Makes recommendations
to the Board about
any requirements for
independent assurance
• Maintains relationships
with the independent
Auditor receiving their
reports on the control
environment and
any recommended
improvements
Day-to-day responsibility for
risk management activities,
processes, and controls
• Ensures the day-to-day
effectiveness of risk
management activities
• Responsibility for risk
prioritisation, identification,
and assessment at
Functional level
• Reviews risk assessments,
sharing relevant material to
the Audit and Risk Committee
/ Board
• Completes an annual
horizon- scanning exercise for
emerging risks
• Reviews the Group’s risk
register on a quarterly basis
• Develops functional risk
registers aligned to principal
risks where appropriate and
required, ensuring regular
review of the performance of
mitigating controls
• Takes action to improve the
overall control environment,
increasing mitigating activities
where necessary
Drives and coordinates
local risk assessment
and compliance with risk
management processes
• Actively shares knowledge
and best practice through
contact with other
functional leads
• Accepts responsibility
for the risk, its evaluation,
monitoring it and reporting
its status
• Coordinates and
contributes to the
development and
maintenance of an
appropriate control
environment, and reporting
the ongoing effectiveness
of controls
• In combination with the Risk
Register Owner, updates
the risk report to show the
current status
Group risk appetite statement
The Board is responsible for setting
the risk appetite for the Group and
does so taking into consideration the
expectations of its stakeholders and
members as a whole. The Group’s risk
appetite statement provides a useful
guide to inform strategic decision-
making, facilitate the review of risk
management, and to set targets
against which risk objectives must
beprogressed.
We are more open to most strategic
and operational risks, recognising the
clear growth opportunity ahead, and
the need to test and trial new ideas and
ways of working. In these areas we have
moderate or higher risk appetite.
We are more cautious with regard to
financial, regulatory compliance, IT and
cyber security, people and culture, and
climate change risks. In these areas we
have a low- risk appetite.
The Group has a very low appetite for
risks which could damage our brand
and reputation, including the health and
safety of all our colleagues, customers,
suppliers, and any non-compliance to
our policies and procedures.
Read more:
The Group’s Risk
Appetite Statement
is available at www.
procookgroup.co.uk
Professional
Stainless Steel
cookware range
Group plc Annual Report and Accounts 2023 59
Strategic Report
Principal risks and uncertainties
In accordance with the Group’s Risk Management Policy as set out on the previous pages, the Board has undertaken a
detailed review of the Group’s principal risks and uncertainties, including new or emerging risks, and those that could
damage its business model, or adversely impact its operational activities or financial performance and position.
There are three overarching macro events which continue to have a significant impact on the level of risk that the Group
currently faces. These are the lasting impacts of Covid-19 and Brexit, the Russian invasion of Ukraine, and the
cost- of-living crisis.
These three macro themes have broad-ranging impacts across our principal risks and uncertainties, and therefore have not
been presented as individual principal risks themselves.
1. Lasting impacts of
Covid-19 and Brexit
2. The Russian Invasion
of Ukraine
3. The cost of living crisis
While the direct restrictions to
customers, colleagues and our
business operations which related
to Covid-19 have now eased,
the Group continues to manage
the lasting impacts of both
Covid-19 and Brexit which have
become largely intertwined within
other, subsequent events which
together have created significant
uncertainty in the macro-
environment. These impacts
include:
• Economic unpredictability and
volatility
• Changing customer preferences,
needs and behaviours
• Labour shortages in retail,
logistics, manufacturing, and
certain support functions
• Supply chain disruption and an
inability to interact as effectively
with suppliers around the world
• Greater prevalence of physical
and mental health issues and the
risk of new variants or pandemics
• Increased regulatory complexity
when dealing with Europe
The impact of the Russian invasion
of Ukraine has had a significant
impact on our business and our
customers, and while the conflict
continues these impacts are likely
to continue to evolve. As ProCook
does not have, nor had, any
direct operations in Russia or with
sanctioned countries or individuals
the direct risks have been limited,
however the side effects of the
invasion have increased risk in the
following ways:
• Inflationary pressures directly
impacting business operations
and profitability
• Inflationary pressures impacting
customers’ disposable income
and behaviour
• Greater threat to cyber security
requiring a direct response
through a programme of
improvements made in the last
12 months
• Increased foreign exchange
volatility and deterioration in
Sterling to US Dollar rates as
the US Dollar became a global
currency safe haven
• Heightened geo-political
tension and instability
The cost-of-living crisis in the UK, triggered by
the factors set out above and compounded
by the UK political backdrop, has become
more profound as the last year has progressed,
resulting in consumer confidence reaching
a record low in September 2022 during a
period of significant energy price and political
uncertainty. The pressures on disposal incomes
have become more significant and remain
pervasive, and although they are widely
projected to ease over the months ahead, in
real terms the average consumer is now worse
off. These impacts present direct risks for
the Group:
• Inflationary pressures on our cost base
including fuel, energy, wages, food, raw
materials in product costs
• Foreign exchange volatility and heightened
cost of debt
• Lower consumer confidence and reduced
disposable incomes impacting trading
performance
• Increased retail selling prices to partly
mitigate cost growth, further impacting
trading performance
• Increased competition to acquire customers,
particularly through direct paid media
marketing channels
• Concerned colleagues who are also
struggling with cost- of- living pressure,
and impact on morale through this
challenging period
Group plc Annual Report and Accounts 202360
Changes to our principal risks
and uncertainties
The macro themes set out above
have resulted in changes to either the
likelihood or impact (or both) of the
principal risks that the Group faces.
The Board considers that the inherent
risk has therefore increased in five of
the principal risks, and has decreased
in one:
The recent and rapid deterioration
in the economic and consumer
environment has led to a
significant downturn in consumer
confidence caused by the
combined adverse impacts of
significant inflation (including
the costs of energy, fuel, food
and other goods and services),
interest rate rises, tax increases
and slower wage growth. The
Board has determined that the
potential impact of competition,
market and macro-economic
risks has increased.
Reputational damage to the
brand is heightened due to
increased promotional activity
and more frequent direct
marketing communications to
attract customers in the highly
competitive market, and the risk
that consumers choose to divert
any discretionary spend away
from kitchenware products.
The pressures on real disposable
income for consumers are the
same for our colleagues and,
combined with the challenge
to morale that weaker trading
performance creates, as
evidenced by our weaker
colleague engagement score
year on year, there are greater
risks around people and culture
related to retention, recruitment,
motivation, and engagement.
While we have recruited a large
number of new customers this
year, we have been more heavily
reliant on in-market customer
acquisition via paid media
channels than in recent years. The
cost of this acquisition activity
has increased and combined with
the market shift back to Retail
stores, the Board considers there
is a greater risk to marketing
effectiveness.
Recent trading performance,
impacted by macro factors has
been much more uncertain, and
forecasting performance and
managing cash and covenants
has therefore become more
challenging. Equally, interest rate
increases, inflationary pressures
on costs, and FX volatility
have increased finance and
treasury risks.
Supply chain risk has decreased
as a result of the transition to
our new Distribution Centre,
consolidating stock and logistics
activities, and due to the lower
disruption to the marine freight
system as the impacts of
Covid-19 subside. Additionally,
we have completed the
implementation of a new courier
system, reducing risk to home
delivery operations by splitting
parcel volumes between multiple
partners.
Principal risk heatmap
The heat map diagram illustrates the Board’s assessment of the
principal risks and uncertainties, and their movement year on year after
the effect of existing or new mitigating internal control activities:
Emerging risks
The Board have carefully considered the principal
risks and uncertainties, and whether there are
any new emerging risks which the Group faces.
The principal risks and uncertainties are not
exhaustive, and the Group may be exposed to
risks wider than those listed, including risks not
currently known or identified, or currently deemed
to be less material, which may also have an
adverse effect on our activities.
Awareness of emerging risks is important to
support strategic planning and decision-making,
and to identify mitigating actions and controls
which may be required as events and risks
evolve. The key emerging risks identified by the
Board are:
• The cost- of- living crisis with regard to both
its duration and how profound its long-term
effect will be on consumer behaviour and
discretionary spending power
• Geo-political tensions including those related
to the Russian war in Ukraine, China (and Taiwan)
and other political changes including the UK
government election which is anticipated in the
next twelve to eighteen months
01.
Decrease
01.
Increase
FY23: Strategic Operational Financial and compliance
FY22:
Strategic Operational Financial and compliance
Likelihood
Impact
2
1
4
3
9
7
5
6
8
10
2
4
9
7
5
6
8
10
1
3
Group plc Annual Report and Accounts 2023 61
Strategic Report
Principal risks and uncertainties
Continued
Strategic risks
1. Strategy and business change
Our failure to identify and successfully execute appropriate strategies to develop and grow the brand over the medium to
long term could be affected by a range of factors including changes in competition or products, consumer behaviours and
trends, inadequate change management or leadership. This could slow or limit the growth of the business, distract from and
/or damage the overall customer proposition, incur additional cost, or serve to demotivate colleagues if not led effectively.
Risk Appetite Open (moderate to high)
Link to strategy
1 2 3 4 5
KPIs
• Revenue
• Underlying PBT
• Number of active
customers (L12M)
Board oversight
• Annual Board strategy
planning day and
3-5 year financial
plan review
• Periodic strategic
progress updates
• Rotational deep dive
strategy sessions at
each Board meeting
Executive Responsibility
Daniel O’Neill, Chief
Executive Officer and
Founder
Context and potential risk impacts
There are currently a number of business- critical change
programmes underway including:
1. Creating a world-class website to transform our customer
experience online
2.Completing the transition into our new Distribution Centre
and realising the operational efficiencies
3.Developing our culture, values, and leadership to support
continued growth as we become a larger and more
complex business
Each of these have their own inherent risks and require
effective programme management and leadership to
deliver alongside the full strategic programme, at pace, on
time and within budget.
Read more: Our strategy – pages 10 to 20
Potential risk impacts include:
• Failure to meet financial or other non-financial targets
• Loss of customer confidence and reputational damage
• Reduced or limited business growth
• Failure to retain colleagues, or loss of colleague engagement
• Loss of focus on core business activities
• Delays in strategy execution may lead to a loss of
investorconfidence
Mitigations
• Medium to long term
business strategy is
developed and reviewed by
the Board at least annually
• Steering Groups
established for key projects
reporting to the Board
• Clear accountability for
strategic execution is
delegated to the Exec and
progress monitored by
the Board
• Experienced leadership and
stability in the leadership
team with a culture of long-
term entrepreneurial growth
• Use of external expert
advisors to support strategy
development and execution
where appropriate
• Use of trial /
experimentation
methodologies for agile
change programmes to
monitor change impacts
How our principal risks and uncertainties link to our strategy
The table below highlights how our principal risks and uncertainties link with our strategic priorities, as set out on pages 10 to 20.
Ref Principal risks and uncertainties
Change
vs FY22
1 2 3 4 5
1 Strategy and business change Y Y Y Y Y
2 Competition, market andmacro-economic
Y Y Y
3 Brand and customer
Y Y Y Y
4 Climate change
Y Y Y Y Y
5 Supply chain
Y Y Y Y
6 Technology platforms, data lossandcybersecurity
Y Y Y
7 Marketing effectiveness
Y
8 People and culture
Y Y Y Y Y
9 Financial and treasury
Y Y Y Y Y
10 Regulatory compliance
Y Y Y Y Y
Group plc Annual Report and Accounts 202362
2. Competition, market, and macroeconomic
Our failure to adapt to changing consumer needs given external macro factors, and to maintain a compelling customer
offer compared to competitors could limit or reduce profitability and opportunities for growth. Macroeconomic factors
which reduce consumer confidence and / or disposable incomes or create additional cost pressures could impact
revenue growth and profit generation.
Risk Appetite Open (moderate)
Link to strategy
1 2 4
KPIs
• Revenue
• Underlying PBT
• Number of active
customers (L12M)
Board oversight
• Monitoring market
share, competitor, and
customer data
• Reviewing and
challenging sales
performance and cost
base efficiency in
periodic Board reports
• Developing and
monitoring strategic
and operational
action plans
Executive Responsibility
Daniel O’Neill, Chief
Executive Officer and
Founder
Context and potential risk impacts
Over recent months, the combined effects of Covid-19,
Brexit, and the Russian invasion of Ukraine have continued
to evolve and have contributed to significant uncertainty
for customers, driven by economic volatility, significant
inflation, and cost of living pressures.
This has led to greater competition in the marketplace with
increased promotional activity and higher costs to acquire
customers.
These external factors may persist for some time.
Potential risk impacts include:
• Reduced profitability and inhibited growth opportunities
• Loss of market share to competitors
• Increases in costs such as fuel, energy, raw materials,
marketing, and labour
• Reduced new customer acquisition
• Slower repeat purchase frequency
• Lower average transaction values
• FX and interest rate volatility or higher costs
Mitigations
• Focus on exceptional value
and high- quality service
with KPI’s monitored by the
Leadership team
• Continual monitoring of
market performance, and
competitor activity including
pricing and promotions
• Investment in technology
and supply chain capabilities
to improve customer
experience
• Regular range refresh to
attract new and repeat
business with 154 new
launches in FY23
• Increased promotional
activity and customer
communications around
exceptional value
• Achieved “Which”
certification and obtained
B Corp status, focussing
on customer demand for
sustainable, high-quality
products.
• Extended our foreign
exchange hedging policy
and coverage in future
periods
• Prudent cash management
and preservation to minimise
debt interest costs
• Identification of business
efficiencies, and close
working with suppliers to
mitigate cost pressures
• Improvements to paid
media efficiency using
programmatic and AI-
bidding technology
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
Risk impact change year on year:
01.
New
01.
Decrease
01.
Increase No change
Group plc Annual Report and Accounts 2023 63
Strategic Report
Principal risks and uncertainties
Continued
3. Brand and customer
Reputational damage leading to loss of consumer confidence in ProCook products or services, which could be caused
by a variety of factors including customer data loss, product quality, health and safety, level of direct marketing activity,
ethical or sustainability concerns, poor customer service, or regulatory non-compliance.
Risk Appetite Cautious (low)
Link to strategy
1 2 4 5
KPIs
• Revenue
• Number of active
customers (L12M)
• Number of new
customers
• Trustpilot score
Board oversight
• Monitoring market
share, competitor and
customer data
• Reviewing and
monitoring Trustpilot
review KPIs and data
• Review and approval of
the ESG strategy
Executive Responsibility
Angela Porter, Chief
Marketing Officer
Context and potential risk impacts
Reputational damage to the brand is currently heightened
due to increased promotional activity and more frequent
direct marketing communications to attract customers in
the current, highly competitive, market.
There is increased risk that consumers choose to divert
discretionary spend away from kitchenware products while
inflationary pressures persist.
Potential risk impacts include:
• Lower new customer acquisition
• Loss of existing customers and repeat business, and lower
life time value
• Reduced revenue growth and lower profitability
• Loss of market share to competitors
• Lower colleague retention due to a decrease in
engagement with the brand
Mitigations
• Rigorous product quality
testing and certification,
accompanied by strong
warranties. Robust supplier
selection with Sedex
monitoring to ensure strong
ethical and environmental
compliance through
audits of labour standards,
health and safety and
environmental assessments
• Technology vulnerability
and penetration testing with
continual security capability
improvement, Payment
Card Industry and Data
Protection compliance.
• Colleague code of conduct
and business culture,
monitoring colleague
engagement and Glassdoor
ratings
• Monitoring of brand health
metrics including Trustpilot
reviews
• Continued focus on
sustainability recognised
with B Corp certification
Group plc Annual Report and Accounts 202364
4. Climate change
Any failure to implement our ESG ambitions within acceptable timescales and deliver on stakeholder expectations to
reduce the environmental impact of our business and progress towards our net zero targets. These include actions linked
to our ESG strategy and managing the potential consequences of climate change on our business. Failure to meet the
expectations of our customers, colleagues, investors and other stakeholders, may impact our brand reputation and future
trading performance.
Risk Appetite Cautious (low to moderate)
Link to strategy
1 2 3 4 5
KPIs
• CO
2
emissions
Board oversight
• Deep dive review
sessions on ESG
provide opportunity to
challenge
• Review and approval of
the ESG strategy
Executive Responsibility
Dan Walden, Chief
Financial Officer
Context and potential risk impacts
ProCook has long been committed to reducing our
environmental impact and encouragingly there is now
increasing awareness of climate change across our
stakeholder groups.
As we transition towards a low-carbon economy there are a
variety of potential risks to strategy execution and financial
performance including:
• Increasing frequency of natural disasters which could
impact our operations including our supply chain
• Legal and compliance changes which may disrupt our
operations and increase costs (including taxation)
• Reputational damage due to insufficient progress or
compliance failure, which could also result in lower
colleague engagement
• Changes in customers preferences may require product
or proposition changes which could increase costs
Mitigations
• Focus at Board, Executive
and Leadership Team. ESG
strategy developed by ESG
Director and Green Team in
active progress
• Continued partnership
with The Woodland Trust to
mitigate unavoidable Scope
1 and 2 CO
2
emissions
• BCorp certification
awarded in FY23
• Electric vehicle fleet for all
Company cars, BREEAM
certified new Distribution
Centre and HQ
• Removal of all unnecessary
product packaging
(including single use plastic)
across our range
• Comprehensive
environmental management
system in place for
monitoring water, waste,
energy and CO
2
emissions
• Environmental marketing
to promote sustainable
choices
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
Risk impact change year on year:
01.
New
01.
Decrease
01.
Increase No change
Group plc Annual Report and Accounts 2023 65
Strategic Report
Principal risks and uncertainties
Continued
Operational risks
5. Supply Chain
Failure to source products effectively and efficiently, or to ensure inventory is maintained in the right volumes at the right
locations could adversely impact our short and medium term operational and financial performance.
Risk Appetite Open (moderate)
Link to strategy
1 2 3 5
KPIs
• Revenue
• Underlying profit
before tax
• Free cash flow
Board oversight
• Deep dive review
sessions on supply
chain provide
opportunity to
challenge
• Review and discussion
of Stock and Supply
Chain Report each
Board meeting
• Approval of new
Distribution Centre
business case
Executive Responsibility
Daniel O’Neill, Chief
Executive Officer and
Founder
Context and potential risk impacts
We source products from established suppliers around the
world and import them directly to our Distribution Centre in
the UK from where we operate our own logistics capabilities
to despatch products to couriers for home delivery or to our
retail stores.
The impacts of the Covid-19 pandemic had a significant
effect on sourcing and particularly shipping, which has
noweased.
Additionally, we have transitioned our operations from
two separate warehouses with further external storage,
into our new purpose-built Distribution Centre to provide
operational benefits and increased capacity.
These factors have reduced the level of risk however there
remain potential risk impacts associated with our supply
chain including:
• Delays in product shipments could lead to inventory
shortages, availability issues and possible loss of revenue
• Increased costs from input or raw material costs, and/ or
higher costs of shipping, could reduce gross margins, or
require increased selling prices which may reduce revenue
• Delays in order shipment to customers may damage the
overall customer experience and impact brand reputation
• Geo-political tensions or future wars or pandemics may
impact our ability to source products of sufficient quality,
when needed and at the right price
• Higher inventory levels may lead to increased costs of
storage and logistics and lower free cash flow
Mitigations
• Continuous communication
with product and freight
suppliers
• Robust inventory
management including
intake planning and
availability optimisation.
Monitored by
weekly reviews with
Leadership Team
• Use of well-established
outbound suppliers with
monthly performance
review meetings
• Our new central Distribution
Centre brings inventory into
one location, adds capacity
for growth and will deliver
operational efficiencies
• Product supplier base
exceeds 100 established
suppliers providing
flexibility and resilience
• Achieved >98%
delivery on time for UK
Ecommerce orders
Group plc Annual Report and Accounts 202366
6. Technology platforms, data loss and cyber security
Any failure to develop and maintain appropriate technology to support operations, or the loss of key platforms or data due
to cyber-attacks or other failures without an adequate response, could lead to reputational damage, fines or higher costs,
or a loss of stakeholder and customer confidence in our Brand.
Risk Appetite Cautious (low)
Link to strategy
1 2 3
KPIs
• Underlying profit
before tax
• Trustpilot score
Board oversight
• Deep dive review
sessions on
Technology roadmap
and strategy provide
opportunity to
challenge
• Review and discussion
of Technology and
Cyber Security Report
each board meeting
• Approval of Tech
Strategy each year and
regular monitoring of
development roadmap
delivery
Executive Responsibility
Dan Walden, Chief
Financial Officer
Context and potential risk impacts
We rely on our technology systems to support our
business operations including inventory and supply
chain management, recording and processing customer
transactions, and in analysing performance results and
customer data.
The increasing sophistication and frequency of malicious
cyber activity, including the consequence of the Russian
invasion of Ukraine and broader geo-political tensions have
increased cyber security risk.
Our reliance on third parties to provide technical services
including hosting and digital technology presents risks that
we do not have full control over.
• Loss of access or functionality could result in loss of
revenue and/ or reputational damage and could require
significant investment to remediate
• Loss of customer data could cause reputational damage,
impact our operations and/ or result in breach of
regulations with potential financial penalties
• Delayed implementation of new technologies as our
business evolves and becomes even more digitally led
could disrupt business operations, slow the pace of
strategic progress, or result in higher costs
Mitigations
• Robust security procedures,
policies and protocols
established, including
disaster recovery plans and
system documentation
• High level of system
monitoring and “on-call”
procedures support high
level of system up-time
(>99.9% in FY23)
• Test and deployment and
change management
procedures established for
technology deployments
• External expertise utilised to
support system monitoring,
Data Protection and
Payment Card Industry
compliance
• Regularly perform
vulnerability scanning
and penetration testing
procedures to assess
status and identify security
and system resilience
improvements to make
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
Risk impact change year on year:
01.
New
01.
Decrease
01.
Increase No change
Group plc Annual Report and Accounts 2023 67
Strategic Report
Principal risks and uncertainties
Continued
7. Marketing effectiveness
The Group’s future performance depends on customer acquisition and retention with cost-efficient marketing spend,
appropriate creative messaging and relevant media mix. Any failure to attract new customers and retain existing customers
in a cost-effective and engaging way could impact short term performance and medium strategic growth ambitions.
Risk Appetite Cautious (moderate to high)
Link to strategy
1
KPIs
• Revenue
• Underlying profit
before tax
• Number of active
customers (L12M)
• Number of new
customers
Board oversight
• Monitoring and
challenging
performance across
customer and relevant
financial KPIs
• Regular deep dive
sessions on customer
and marketing activity
• Reviewed and
approved the
brand purpose and
proposition framework
Executive Responsibility
Angela Porter, Chief
Marketing Officer
Context and potential risk impacts
ProCook has a significant opportunity to grow brand
awareness in the UK and expand our customer base.
Effective marketing activity is critical to achieve this.
The current macro-environment has led to increased
competition to attract and convert customers resulting
in higher costs of marketing and promotional activity.
This is likely to evolve and persist while conditions remain
challenging which could have the following potential
impacts:
• Lower marketing effectiveness (either in engagement
or cost) could result in lower revenue from fewer new
customers or falling repeat rates, and higher costs / lower
profits
• Failure to attract new customers and successfully grow
brand awareness could limit the achievement of our
strategic objectives
• Increased promotional messaging, or higher frequency of
communications could deter certain customers and has
the potential to damage brand reputation
Mitigations
• The Group ensures the
CMO and CEO sign off
key messaging and spend
within a defined budget
• Monitoring of detailed
marketing metrics against
budgets including Return
on Ad Spend (“ROAS”) and
Cost per Acquisition (“CPA”)
• Communications
Framework established
to sign off customer
messaging
• Attracted 692,000 new
customers during FY23,
grew our number of active
customers (L12M) to almost
1,000,000
• Development of our brand
purpose and proposition to
provide a “North Star” for all
marketing activity
• Continually assess, test
and trial new recruitment
channels
• Introduced new CRM
platform which also acts
as email service provider
to consolidate activity
and improve retention
capability through improved
segmentation and data
analytics
Group plc Annual Report and Accounts 202368
8. People and culture
Any failure to attract, retain and develop the right talent, skills and capabilities or to successfully protect and develop our
culture could impact operational activities including customer service and our longer-term strategic objectives.
Risk Appetite Cautious (low)
Link to strategy
1 2 3 4 5
KPIs
• Colleague
engagement score
Board oversight
• Deep dive review
sessions on people
and culture strategy
provide opportunity to
challenge
• Review and discussion
of People Report each
Board meeting
• Review of annual
engagement score
results and associated
improvement plans
• Designed NED attends
Colleague Advisory
Panel and reports to
the Board
• Succession
planning reviewed
by the Nominations
Committee
Executive Responsibility
Daniel O’Neill, Chief
Executive Officer and
Founder
Context and potential risk impacts
ProCook employs over 600 committed and talented
colleagues, and we believe being an attractive brand to work
for, and protecting our culture is critical to our continued
success in attracting and retaining top talent.
Current and potential colleagues continue to show greater
preference for roles with purpose and greater flexibility to
support their own life choices.
The labour market and skills shortages in the UK, coupled
with the cost of living crises and our recent softer financial
performance, presents a greater risk around retention and
recruitment.
• Loss of existing expertise and knowledge could impact
operations or delivery of strategic objectives
• Increased risk of cost growth through total reward
inflation due to macro-factors
• Higher level of colleague absence or reduction in
colleague engagement could impact our operations
andcustomer service
Mitigations
• Monitoring of colleague
engagement, turnover
and other metrics by the
Executive, Leadership Team
and Board
• Refreshed people
processes with annual
appraisal reviews, personal
development plans.
Continued investment in
leaning and development
programmes
• Established Code of
Conduct explained to all
new starters
• Launch of new Company
policies including Diversity
and Inclusion, Mental Health
and Well-being, Stress, and
Menopause policies
• Launch of Company values
to help protect and develop
our culture
• Continued commitment fair
reward including the Real
Living Wage
• Awarded Great Place to
Work
TM
certification for a
second time in FY23
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
Risk impact change year on year:
01.
New
01.
Decrease
01.
Increase No change
Group plc Annual Report and Accounts 2023 69
Strategic Report
Principal risks and uncertainties
Continued
Financial and compliance risks
9. Financial and treasury
Any failure to effectively manage our financial affairs and ensure an appropriate financial position and sufficient liquidity
for future growth, or any failure in financial planning, financial reporting, compliance with tax legislation, or the maintenance
of a robust financial control environment, could impact our ability to deliver our strategic objectives, as well as have an
adverse impact on business viability.
Risk Appetite Cautious (low)
Link to strategy
1 2 3 4 5
KPIs
• Underlying profit
before tax
• Free cash flow
Board oversight
• CFO reports reviewed
and discussed at each
Board meeting
• Annual budget and
re-forecasts reviewed
and approved by
the Board
• Audit and Risk
Committee reviews
financial control
framework and
risk management
framework
• Various policies
reviewed and
approved by the Board
including Treasury
Policy and Capital
Allocation Policy
Executive Responsibility
Dan Walden, Chief
Financial Officer
Context and potential risk impacts
The challenging macro-environment and our weaker
financial performance has required even greater level of
focus on our cash and covenant management, forecasting
and reporting, and thorough review of financial controls.
We continue to focus on these ensuring that we have
appropriate liquidity headroom, to support our operational
performance and strategic objectives.
The rapid deterioration in foreign exchange rates earlier last
year, coupled with rising interest rates have increased the
risk of higher costs.
Other potential risk impacts include:
• Inaccurate or untimely financial reporting may result
in misguided decision- making impacting future
performance
• Non-compliance with regulatory requirements including
tax could result in fines or penalties and damage our
reputation
• Failure in financial controls could result in loss of business
assets or higher costs reducing profitability
• Loss of liquidity business flexibility if insufficient
headroom maintained to support working capital or
investment decisions
Mitigations
• Established relationships
with banking partner
with £10m available RCF
undrawn at year end, with
£2.8m of net debt
• External professional
support utilised where
required for technical
advice
• Foreign exchange hedging
undertaken to help mitigate
risk of volatility within
approved Treasury Policy
• Robust approach to
budgeting and forecasting
throughout the year
• Financial Position,
Prospects and Procedures
documentation reviewed
annually by the Board
• Finance Risk Register and
process documentation
established continually
developed
• Continual focus on
enhancing financial internal
controls
Group plc Annual Report and Accounts 202370
10. Regulatory compliance and corporate responsibility
Any failure to comply with legal and regulatory obligations, or our wider corporate responsibility could result in financial or
legal exposures, or damage to our reputation with our Stakeholders as a responsible brand.
Risk Appetite Cautious (low)
Link to strategy
1 2 3 4 5
KPIs
• Revenue
• Underlying profit
before tax
Board oversight
• Corporate governance
topics reviewed and
discussed at each
Board meeting
• CFO reports to the
Board on any key
internal policy changes
seeking approval
where needed
• Audit and Risk
Committee review
regulatory risks as part
of risk management
procedures
Executive Responsibility
Dan Walden, Chief
Financial Officer
Context and potential risk impacts
The legal and regulatory landscape in which we operate
remains stringent and is subject to frequent changes and
updates which require us to adapt our operational and
compliance procedures.
We are committed to compliance with all relevant
regulations however any failure to do so could result in a
range of potential risk impacts including:
• Regulatory breaches could result in adverse publicity
which could damage customer or other stakeholder
confidence, and potentially impact revenue growth,
profitability or funding
• Potential fines or other penalties for non-compliance,
or costs in relation to any legal proceedings or remedial
actions
• Potential injury or loss to a colleague, customer or
other stakeholder (particularly in the event of a Health &
Safety issue)
• Loss of focus on business operations and
strategic objectives in the event of a significant a
compliancebreach
Mitigations
• Group policies and code
of conduct shared with
colleagues and training
provided
• External professional
advice obtained on relevant
matters e.g. GDPR, property
legal advice, employment
advice, tax advice
• Health & Safety Manager
leads the development of
the Groups’ Health & Safety
Policy and completes
site audits and maintains
incident reporting and
monitoring
• Established policies and
procedures for technical
topics such as Trading
Standards, WEEE, Waste
Management, Market
Abuse Regulations, GDPR,
PCI which are overseen by
senior management
• Company Secretary
facilitates ongoing review of
governance best practice
with the Board
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
Risk impact change year on year:
01.
New
01.
Decrease
01.
Increase No change
Group plc Annual Report and Accounts 2023 71
Strategic Report
Assessing long-term viability
In accordance with the UK Corporate Governance Code,
the Board of Directors is required to assess the viability of
the Group over a longer time period than twelve months to
determine whether it has a reasonable expectation that it
will be able to continue in operation and meet its liabilities as
they fall due, and to issue a ViabilityStatement’.
As part of this assessment, the Board has considered the
future prospects of the Group by reference to its current
financial position, recent trading performance and market
outlook, forecasts and financial projections, its strategy and
business model, and its principal risks and uncertainties.
The Board has determined that a three-year viability
assessment period covering the three financial years ending
29 March 2026, appropriately reflects the speed of change
in the retail and consumer environment and is consistent
with the Group’s strategic planning cycle. This time period
provides a reasonable balance between the long-term
nature of investments and the key drivers of near-term
business performance.
The Directors have considered the Group’s principal
risks and have assessed the impact of a range downside
scenarios, including a severe but plausible downside
scenario, on the Group’s expected financial performance,
position and cash generation. The scenarios have been
informed by a comprehensive review of the macroeconomic
environment, including the Group’s experience of trading
through challenging periods, such as the Covid-19
pandemic, and the most recent macro-economic downturn
in which consumers have been impacted by significant
inflationary pressures.
Consideration has been given to the availability of facility
headroom and covenant compliance within the Group’s
financing facilities, and the recently revised fixed charge
covenant terms, details of which are as follows:
• ProCook’s bank facility agreements and the associated
covenants are set out in the CFO’s Review within this
report and include a committed £10m RCF (expiring in April
2025, with a one-year extension option to April 2026),
with a £5m accordion option to the RCF, subject to lender
approval, and an uncommitted £6m trade finance facility.
• Shortly after the year-end, on the ay 2023, the Group
successfully finalised an amendment to the RCF terms in
respect of the fixed charge cover covenant, which had
been agreed with HSBC during March 2023 in order to
provide additional headroom against that covenant given
that the Group’s EBITDA performance declined during
the year and would have breached the test at the end of
the financial year without action. The revised test requires
EBITDAR to be no less than 1.25x fixed charges for the
FY23 Q4 and FY24 Q1 test dates, and 1.40x thereafter. The
leverage coverage remains unchanged with net debt to be
no greater than 2.0x EBITDA. Both covenants are tested
quarterly and calculated on a last twelve month rolling,
pre-IFRS 16 bases.
• ProCook ended the financial year with net debt of £2.8m,
with £2.0m cash and cash equivalents and drawings on
the trade finance facility of £4.7m with available liquidity
headroom of £13.2m.
The base case for the scenario modelling extends from the
Group’s annual budget plan that was approved by the Board
in April 2023. Forecasts for FY25 and FY26 are based on the
Group’s strategic objectives and its five year financial plan,
which projects forwards from the FY24 budget.
Key assumptions include Ecommerce and Retail like for like
revenue growth, gross margin performance reflecting the
return to more normal marine freight costs, the financial
impacts of opening of new stores (including capital
investments and time to maturity), operational efficiencies
being delivered, investment in brand marketing activities,
and the appropriate level of inventory required to maintain
strong availability forcustomers.
In their consideration of the Group’s principal risks and
uncertainties the Board believes that the most likely
and most impactful risks that the Group faces are those
surrounding customer and macro-economic factors,
marketing effectiveness, and financial and treasury risks,
all of which are heightened as a result of the current macro-
environment.
The Board has reviewed the potential downside impact of
these risks unfolding, modelled under a number of scenarios
including a severe but plausible downside scenario which
reflected the following assumptions:
• A significant reduction in customer demand and shopping
frequency, caused by continued macro inflationary
pressures and further increases in interest rates
throughout the three-year assessment period, resulting
in a resulting in a 15% lower revenue performance in the
FY24 year to go compared to base case (with LFL revenue
declining a further -5%pts compared to year to date
performance), increasing to a 20% decrease in FY25
and a 25% decrease in FY26, combining to reflect a 89%
reduction in Group revenue growth over the assessment
period compared to the base case.
• Heightened competition to acquire customers in the
market as demand falls, results in a 10% increase in the
cost of customer acquisition through online channels.
• The level of promotional activity required to convert
customers increases and coupled with a deterioration in
GBP against the US dollar, gross profit margins reduce by
200bps compared to base case, commencing in H2 FY24.
• The increase in interest rates results in an increase of
100bps in the Group’s cost of borrowing through its
facilities.
Under this severe but plausible downside scenario,
and before mitigating actions, the Group would remain
comfortably within its available borrowing facilities
throughout the assessment period and remain compliant
Group plc Annual Report and Accounts 202372
with the leverage covenant test.
However, it would breach the fixed
charge covenant at the Q2 FY24
test date and subsequently breach
from Q3 FY25 test dates onwards.
The Group has a positive and
long-standing relationship with its
banking partner HSBC, however
there is no guarantee that a covenant waiver, new banking
terms, or alternative funding arrangements could be agreed
within an acceptable period, and there is therefore the risk
that current funding arrangements could be withdrawn.
The Board has also reviewed a reverse stress test which has
been applied to the base case model to determine the level
of sales decline which would result in a breach of financial
covenants. A reduction in revenue, with no mitigations
applied, of approximately 11% compared to the base case in
Q2 FY24 (representing a year on year decline in LFL revenue
of -12% in the remainder of FY24), would be required to
breach fixed charge covenants at that quarter-end test
date. A further reduction in revenue of 21% in FY25 would
be required to breach fixed charge covenants in that year,
and a further reduction in revenue of 25% in FY26 would be
required to breach fixed charge covenants in that year.
The other downside scenarios linked to the key principal
risks and uncertainties, which were considered by the Board,
have a cumulative impact which was similar to the severe but
plausible downside scenario outlinedabove.
The Board has also considered the potential impacts of
climate change risks (as set out on pages 48 to 50). These
are not considered to have a material effect on the Group’s
financial projections over the assessment period.
If any of the downside scenarios were to arise, including the
severe but plausible downside scenario and the reverse
stress test scenario, there are a series of mitigating actions
that the Group could seek to implement to protect or
enhance financial performance and position including to:
• Increase selling prices for products which have lower price
elasticity to help offset additional sourcing costs
• Increase promotional activity to accelerate trading
performance and reduce stock levels, or alternatively,
reduce promotional activity to better protect gross
margins
• Reduce paid media, above-the-line or retention
marketing spend
• Reduce non-variable costs in operational functions to
reflect the lower sales volumes
• Reduce central overhead costs (including headcount
investment) over the short or medium term
• Delay capital expenditure in retail, technology and
logistics
• Renegotiate payment terms with suppliers
• Seek alternative forms of financing or new banking terms
to support working capital and investment requirements
Conclusion
The Board has undertaken a comprehensive review and
assessment of long term viability over the period to 29
March 2026 including the Group’s financial projections,
debt servicing requirements, available facility headroom
and liquidity, and its principal risks and uncertainties. In the
base case scenario, and in the other downside scenarios
which the Directors have reviewed, the Group remains
comfortably within its available facility headroom, and
no facility covenants would be breached. However, the
Directors recognise that under the severe but plausible
downside scenario, the Group is likely to breach its fixed
charge covenant unless mitigating actions can be applied
sufficiently in advance to prevent such a breach, requiring
agreement of a covenant waiver, new banking terms, or
alternative funding arrangements, none of which can be
guaranteed. The Directors therefore acknowledge that this
potential breach represents a material uncertainty which may
cast significant doubt over the Group’s long term viability.
The Board considers the likelihood of such a severe
downside scenario materialising to be low and recognises
the range of mitigating actions available to the Group to
prevent a breach occurring, and the positive and long-
standing relationship which the Group has with its banking
partner HSBC. The Directors therefore have a reasonable
expectation that the Group has adequate resources to
continue in operational existence and meet its liabilities as
they fall due over across all three years of the period under
review.
The Viability Statement can be found on page 112.
This Strategic Report from page 2 to 73 was approved by
the Board of Directors on 27 June 2023 and signed on its
behalf by
Daniel O’Neill Dan Walden
Chief Executive Officer Chief Financial Officer
27 June 2023 27 June 2023
Cast Iron
casserole range
Group plc Annual Report and Accounts 2023 73
Strategic Report
Chairman’s governance letter
Dear Shareholder,
I am pleased to present the Company’s
Corporate Governance Report
following its first full year of being listed
on the London Stock Exchange. The
Board recognises that sound corporate
governance is critical to ProCook’s
long-term success and this year has
been a prime example, with the Board
adapting to the ever-changing needs
of the business. This section of the
Annual Report describes our corporate
governance structures and processes
and how they have been applied during
the financial year ended 2 April 2023
(the “period” or “year”).
My role as Chair
My role is to ensure that the ProCook
Group plc Board operates effectively
in delivering the long-term success
of the Company for the benefit of all
stakeholders. In fulfilling this role, I seek
to ensure that Board proceedings are
structured and conducted in such a
way as to allow all Directors to have
the opportunity to express their views
openly and that, in particular, the
Non-Executive Directors can provide
constructive support and challenge
to the Executives. More about my role,
and the roles of all the Directors and
Committees, can be found on pages
77 to 81.
Focus on strategy
Having adapted to life as a listed
Company, the Board’s key focus
during the year was to apply further
scrutiny to the Company’s strategy and
the data that supports this. Strategy
was a regular item at the top of the
Board agenda; plus, we held a half-
day strategy session in January to
review progress against the strategic
priorities set in the prior year, consider
the priorities for the year ahead and to
explore whether these remained likely
to ensure the long-term success of the
business. Further details of our Board
activities and discussions, and how
these contributed to strategy, can be
found on pages 82 to 85.
Board effectiveness
An internal evaluation of the Board
and its Committees was carried out in
December 2022, led by me as Chair.
The purpose of the evaluation was
to review the effectiveness of the
Board, its Committees and individual
Directors. The evaluation was facilitated
via an anonymous online questionnaire
where the Directors were able to
provide comments on a range of
matters relevant to Board, Committee
and individual performance. The results
were shared with the Directors and
discussed at the March 2023 Board
and Committee meetings with a focus
on identifying areas of focus for FY24.
The overall conclusion from the
evaluation was that the Board and
Committees are operating effectively.
However, we also identified areas for
improvement and agreed actions
to further enhance the quality of our
discussions and decision-making.
Theoverriding point was that, in
common with many new Boards,
we had been erring on the side of
politeness and our discussions needed
to be more candid, urgent and direct.
Since identifying the issue, the quality
of dialogue has improved enormously,
and we will ensure that this continues.
To support this discourse, we also
identified areas where management’s
reports to the Board could be
enhanced and will work with the
Executive Directors to refine these in
the coming months.
We have become a leaner, more efficient
and more decisive Board.”
Greg Hodder
Chairman
Group plc Annual Report and Accounts 202374
Governance Report
Embracing change
It has been a year of change for the
Board and an active period for the
Nomination Committee. Our COO,
Steve Sanders, stepped down from
the Board in December ahead of his
planned retirement, the announcement
of which prompted us to review the
size and composition of the Board
and Committees earlier than we
otherwise would have. As a result, the
Board has been scaled down to just
two Executive Directors and three
Non-Executive Directors (including the
Chair). This inevitably meant changes to
Committee chairmanships, with Luke
Kingsnorth stepping into the role of
Remuneration Committee Chair and
David Stead taking the Chair of the
Audit and Risk Committee.
Furthermore, our CEO and Founder
of ProCook, Daniel O’Neill, has
reconfirmed his intention to transition
away from his CEO role at the
appropriate time, and succession
planning for that vital position has
begun. Further details are set out in
the Nomination Committee Report on
pages 86 to 88.
The year ahead
Now that the Board has embedded
its governance framework and
policies and established effective
ways of working together both inside
and outside the boardroom, I will
continually assess and enhance our
governance arrangements in line
with best practice, the needs of the
Company, and the expectations of our
stakeholders.
Annual General Meeting
The 2023 Annual General Meeting
(‘’AGM’’) will take place at 11.00
a.m. on 19 September 2023 at 10 St
Modwen Park, Gloucester, GL10 3EZ.
Shareholders are strongly encouraged
to register their proxy votes online,
regardless of whether they plan to
attend the AGM in person, to mitigate
against the risk of disruptions such
as train strikes. Further details are
included in the Notice of AGM which
will be sent to shareholders with the
prescribed timescales. I look forward
to meeting those of you who are able
to attend.
Greg Hodder
Chairman
27 June 2023
Compliance with
the UK Corporate
Governance Code
The Company is required to
report on its compliance with the
principles and provisions of the
2018 UK Corporate Governance
Code (“Code”), a copy of which
is available at www.frc.org.uk.
The Board considers that it has
complied in full with the Code’s
principles and provisions during
the period. Further information
on how the Company has
complied can be found on the
following pages:
Read more:
Leadership and company
purpose: page 82
Division of Directors’
responsibilities: pages 80 to 81
Composition, succession
and evaluation - Nomination
Committee Report: pages
86 to 88
Audit, risk and internal control
- Audit and Risk Committee
Report: pages 89 to 91
Remuneration - Remuneration
Report: pages 92 to 107
Group plc Annual Report and Accounts 2023 75
Governance Report
Governance Framework
The Board comprises the Chairman, two Executive Directors and two independent Non-Executive Directors (“NEDs”).
The Board keeps a formal schedule of matters specifically reserved for its decision. These include the approval of the annual
and half-yearly results and associated announcements, recommendation of dividends, convening of shareholder meetings,
Board appointments, strategic plans and budgets, ESG plans, significant capex proposals, acquisitions, systems of internal
control and risk management and corporate governance arrangements. No one Board member has the power to make
decisions on behalf of the Board without the sanction of the other members.
The Board has formally delegated specific responsibilities for audit, risk management and financial control, Board
composition and remuneration to three standing Committees, namely the Audit and Risk Committee, Nomination
Committee and Remuneration Committee respectively. Each is chaired by the Chairman or an independent NED, enabling
the Non-Executives to take an active role in influencing and challenging the work of the Executive Directors. The terms of
reference of the Committees are reviewed on a regular basis.
The Board has also established the Disclosure Committee to oversee the identification, management and disclosure of
inside information concerning the Company. The Committee comprises the CEO, CFO, Senior Independent Director and
Audit and Risk Committee Chair and meets on an ad hoc basis as required.
Purpose, Mission and Strategy Governance Performance
• Setting, developing and role-
modelling our purpose and
business values
• Setting the strategy and mission to
deliver on the Company’s purpose,
and secure the continued growth of
the Group over the long term in the
interests of all its stakeholders
• Ensuring that appropriate resources
are in place to successfully deliver
the Company’s mission and strategic
priorities
• Instilling and maintaining a positive
culture that encourages strong ethical
behaviours
• Ensuring that the business control
environment is appropriate and
operationally effective, and that sound
risk management practices are in place
• Oversight of succession planning and
talent management
• Setting an appropriate remuneration
policy to attract and retain talent
• Ensuring that appropriate information
is shared with stakeholders in a
transparent way
• Ensuring full compliance with the UK
Corporate Governance Code
• Reviewing performance at an
operational and strategic level
• Reviewing the performance of the
Board, the Executive Directors and
the Leadership Team
• Ensuring that the Board is well
equipped with appropriate skills
and expertise, and that Committee
memberships are appropriate and
effective
Board meetings
In advance of its meetings, the Board is provided with an agenda and all relevant documentation in a timely manner
to assist in the discharge of its duties and to ensure that decisions are well- informed and made in the best interests
of the Company. If a Director is unable to attend a Board meeting, they always have the opportunity to discuss any
agenda items with the Chairman before the meeting.
Conflicts of interest are managed in accordance with the procedure described under “Directors’ conflicts of
interest” on page 110.
Board and Committee meeting attendance
The following table shows the attendance of the Directors at relevant meetings of the Board, Audit and Risk,
Remuneration and Nomination Committees during the year. Where Directors had sent their apologies, they were
briefed on matters to be discussed at the relevant meeting and their views were considered.
Board responsibilities
Group plc Annual Report and Accounts 202376
ProCook Group plc Board of Directors
The Board of Directors as at the date of this report has five members comprising the Chairman, two Executive Directors and two Independent
Non-Executive Directors.
For Directors’ biographies see pages 78 and 79
Audit & Risk Committee Nomination Committee Remuneration Committee Colleague engagement NED
The committee is made up of
two Independent Non-Executive
Directors
The committee is made up of the
Chairman, and two Independent
Non-Executive Directors
The committee is made up
of the Chairman, and two
Independent Non-Executive
Directors
Luke Kingsnorth is the designated
Non-Executive Director for
Colleague Engagement
Key Responsibilities:
Monitoring the integrity of
the financial statements of
the Company and any formal
announcements relating to
financial performance.
Reviewing the adequacy and
effectiveness of the Company’s
internal financial reporting and
internal control policies and
systems.
Overseeing the Company’s
arrangements for its people to
raise concerns, in confidence,
about possible wrongdoing
in financial reporting or other
matters.
Reviewing the Company’s
procedures for detecting fraud
and preventing bribery and money
laundering.
Overseeing the effectiveness
and performance of the
external Auditor and making
recommendations to the Board
regarding their appointment or
removal.
Advising the Board on the
Company’s overall risk appetite,
tolerance and strategy, and
principal and emerging risks.
Monitoring and reviewing the
effectiveness of the Company’s
risk management framework.
Key Responsibilities:
Reviewing the structure, size
and composition (including the
skills, knowledge, experience and
diversity) of the Board and making
recommendations to the Board
with regard to any changes.
Ensuring plans are in place for
orderly succession to Board and
senior management positions and
overseeing the development of a
diverse pipeline for succession.
Reviewing the leadership needs of
the organisation, both Executive
and Non-Executive, with a view
to ensuring the continued ability
of the organisation to compete
effectively in the marketplace.
Identifying and nominating, for the
approval of the Board, candidates
to fill Board vacancies as and when
they arise.
Evaluating the balance of
skills, knowledge, experience
and diversity on the Board,
and, in light of this evaluation,
preparing a description of the
role and capabilities required for a
particular appointment.
Reviewing the time required
from Non-Executive Directors.
Performance evaluation is used to
assess whether the Non-Executive
Directors are spending enough
time fulfilling their duties.
Key Responsibilities:
Recommend to the Board
the over-arching principles,
parameters and governance
framework of the Group’s
remuneration policy.
Determine, within that
framework, individual
remuneration and benefits
packages of each of the Chair,
Executive Directors and senior
management.
Review the design of all share
incentive plans for approval by
the Board and, where required,
shareholders.
The key purpose of this role is to
help ensure the views and concerns
of the workforce are brought to the
Board and taken into account. In
doing so this role seeks to:
Understand the concerns of
colleagues by attending Colleague
Advisory Panel meetings.
Articulate and share insights from
colleague feedback in Board
meetings.
Ensure the board, and particularly
the Executive Directors, take
appropriate steps to evaluate
the impact of proposals and
developments on colleagues
and consider what steps should
be taken to mitigate any adverse
impact.
Feed back to the Colleague
Advisory Panel on any relevant
Board plans or responses to their
feedback.
The designated NED is not involved
in the company’s whistleblowing
procedure.
See page 89 for the Audit & Risk
Committee’s Report
See page 86 for the Nomination
Committee’s Report
See page 92 for the
Remuneration
Committee’s Report
See page 24 for further detail on
Colleague Engagement.
Terms of Reference for each of the Committees are available on ProCook’s website at www.procookgroup.co.uk
Name Board
Audit and Risk
Committee
Remuneration
Committee
Nomination
Committee
Greg Hodder 10/10 n/a 3/3 6/6
Daniel O’Neill 10/10 n/a n/a n/a
Dan Walden 10/10 n/a n/a n/a
David Stead
1
10/10 7/7 3/3 5/6
Luke Kingsnorth
1
9/10 6/7 3/3 6/6
1
Luke Kingsnorth was unable to attend the Board meeting on 23 March 2023 and Audit & Risk Committee meeting on 30 June 2022, and
David Stead was unable to attend the Nomination Committee meeting on 12 October 2022, due to existing commitments and the meetings
being called at short notice.
Board and Committee governance structures: How we govern
Group plc Annual Report and Accounts 2023 77
Governance Report
Board of Directors
Greg Hodder
Non-Executive Chair
Daniel O’Neill
Chief Executive Officer
and Founder
Dan Walden
Chief Financial Officer
David Stead
Senior Independent
Non-Executive Director
Appointment
29 October 2021
Skills and Experience
Greg brings a wealth of experience with previous
Non-Executive Director and CEO appointments and
a history of driving fast growth from entrepreneurial
companies with particular experience in
e-commerce and multi-channel. Greg has spent
much of his career working in the retail sector
including roles as President of New York-based
company Smallbone plc, CEO of Charles Tyrwhitt
LLP and Chairman of Majestic Wines plc.
Other Roles
Greg is currently a Non-Executive Director at Jarrold
& Sons Ltd and Senior Independent Director at Hotel
Chocolat plc.
Appointment
29 October 2021
Skills and Experience
An experienced Director of companies in the UK
retail sector, David was Chief Financial Officer of
FTSE-listed Dunelm Group plc from 2003 to 2015 and
Interim Chief Financial Officer in 2018. Non-Executive
positions include Non-Executive Director at Card
Factory plc from 2014 to 2021 and Senior Independent
Non-Executive Director of Joules Group plc from 2016
to 2023. Prior to these roles, David served as Finance
Director for Boots The Chemists and Boots Healthcare
International between 1991 and 2003. David is a
chartered accountant, having spent the early part of
his career with KPMG.
Other Roles
David is currently Chairman of Naked Wines plc.
Appointment
14 October 2021
Skills and Experience
Daniel founded ProCook over 25 years ago and has
been employed full-time in the business since then.
Prior to founding ProCook (originally trading as the
Professional Cookware Company until 2008) in the
1990s, Daniel had an early career in direct marketing
businesses and consultancy services and in software
development, developing skillsets and experiences
that have provided guiding principles to support the
development of the ProCook business.
Other Roles
Daniel holds no significant external directorships.
Appointment
14 October 2021
Skills and Experience
Prior to joining ProCook in May 2021, Dan was Chief
Financial Officer of Booking.com Transport. Before
that, he held several roles at Dunelm Group plc
including Group Finance Director and Commercial
Finance Director. Before Dunelm, Dan held various
senior finance and commercial roles at Halfords and
Sainsbury’s. Dan is a chartered accountant, having
begun his career with KPMG.
Other Roles
Dan holds no external directorships
Group plc Annual Report and Accounts 202378
Luke Kingsnorth
Independent
Non-Executive Director
Appointment
29 October 2021
Skills and Experience
Luke joined Charles Tyrwhitt in 2010 as Ecommerce
Director before rising to Ecommerce and Marketing
Director in 2012. Between 2016 and 2019 he was
focused on establishing the New York office and
managing all aspects of the label’s North American
business, before becoming CEO in 2019. Prior to
joining Charles Tyrwhitt, Luke was senior manager at
John Lewis Direct, and has held several ecommerce
and marketing roles at companies including
Eurostar, British Sky Broadcasting Group and
Skandia Life and Manpower.
Other Roles
Luke is currently CEO of Charles Tyrwhitt.
Independent
Non-Independent
2 2
Independence (excl. Chair)
5
5
5
2
3
4
3
Strategy
Consumer/Retail
Ecommerce
Finance
Manufacturing
General management
Marketing
Skills and experience
Board Directors
Name
Number of
Board Directors % of the Board
Number of senior
Board positions
(CEO, CFO, SID
and Chair)
Number in
Leadership Team
% of the
Leadership Team
Men 5 100% 5 4 57.1%
Women 0 0% 0 3 42.9%
White British 5 100% 5 7 100%
Other
ethnic groups 0 0% 0 0 0%
Group plc Annual Report and Accounts 2023 79
Governance Report
Division of Directors’ responsibilities
Clear division of roles and responsibilities on the Board
The key responsibilities of the members of the Board, including the division of responsibilities between the Chairman
and CEO, are set out in the table below.
Role Responsibilities
Chairman The Chairman’s principal responsibility is the effective running of the Board and includes:
• Ensuring the Board as a whole plays a full and constructive part in the development and
determination of the Group’s strategy and overall commercial objectives
• Ensuring the Board determines the nature and extent of the significant risks the Company
is willing to embrace in the implementation of its strategy
• Running the Board and setting its agenda
• Ensuring that all Board members are given the opportunity to share their views and
participate in the business of the Board
• Encouraging all Board members to engage in Board and committee meetings by drawing
on their skills, experience and knowledge
• Ensuring that there is effective communication by the Group with its shareholders,
including by the CEO, CFO and other Executive management
• Ensuring that members of the Board develop an understanding of the views of the major
investors
• Leading the annual evaluation of the performance of the Board, its Committees, and
individual directors
• Shaping the culture of the boardroom
• Ensuring that the Board listens to the views of shareholders, the workforce, customers and
other key stakeholders
Chief Executive Officer
(“CEO”)
The CEO’s principal responsibility is running the Group’s business, including:
• Developing the Group’s purpose, strategy and commercial objectives, and proposing
these to the Board
• Implementing the decisions of the Board and its Committees
• Providing input to the Board agenda, including that from other members of the
Executive team
• Conducting the affairs of the Group with the highest standards of integrity, probity and
corporate governance
• Setting an example to the Company’s people and communicating expectations regarding
the Company’s culture
Chief Financial Officer
(“CFO”)
The CFO is responsible for the overall planning and management of the Group’s financial affairs,
including:
• Working closely with the CEO to ensure that strategic plans are underpinned by solid
financials
• Developing the Company’s budget and monitoring performance against this
• Assessing the benefit of new investment opportunities and capital expenditure initiatives
• Drafting the Company’s statutory financial statements and monthly management
accounts
• Responsibility for internal control and risk management, in conjunction with the Audit
Committee
Group plc Annual Report and Accounts 202380
Role Responsibilities
Chief Operating Officer
(“COO”)
1
During the year, the COO was responsible for overseeing the daily operational and administrative
functions of the business, including:
• Assessing and enhancing the efficiency of operational processes
• Leading staff to achieve sales and organisational objectives
• Establishing policies that improve and promote the Company’s purpose, values and
culture
• Ensuring that operational policies and practices drive behaviour and that appropriate
standards of governance permeate throughout the organisation
• Overall responsibility for People, Health & Safety, Property, and Supply Chain and Logistics
Senior Independent Director
(“SID”)
The SID’s principal responsibility is acting as a sounding board for the Chairman and serving as an
intermediary for the other directors and shareholders, including:
• Working with the Chairman, Directors and shareholders to resolve significant or
sensitive issues
• Assisting in the maintenance of the stability of the Board and Company, particularly during
any periods of stress
• Taking responsibility for an orderly succession process for the Chairman, working closely
with the Nomination Committee
• Being available to shareholders should they have concerns that are unresolvable through
the usual channels of the Chairman, CEO or other Executive Directors
• Leading the performance evaluation of the Chairman on behalf of the other directors
Non-Executive Directors
(“NEDs”)
The NEDs are independent and have been appointed for their knowledge and expertise. Their key role is
to contribute to the strategic direction of the Group, including:
• Providing healthy debate and challenge, as well as guidance and support, to the Executive
Directors
• Providing an independent sounding board to the Chairman and Executive Directors
• Serving on the Board Committees, with responsibility for the oversight of audit and risk,
remuneration, and composition of the Board
• Luke Kingsnorth has also been appointed as the designated Non-Executive Director for
workforce engagement (see more on page 77)
1
Steve Sanders, the COO, resigned from the Board on 14 December 2022 but carried on as COO until 31 March 2023. In FY24 the duties formerly
assigned to the COO will be shared between the CEO and the CFO.
Group plc Annual Report and Accounts 2023 81
Governance Report
Link to strategy and stakeholders
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
Stakeholder:
Customers Colleagues Suppliers Communities Shareholders
Board activities
The Board is collectively responsible for
leading and controlling all activities of
the Company, with overall authority for
establishing the Company’s purpose,
values and culture and overseeing
the management of the Company’s
business, strategy and development.
The Board sets the Company’s
strategic direction and approves
decision-making and policies of
the Group. These decisions are
underpinned by regular financial
reporting and a robust approach to
riskmanagement.
The Board has agreed the Company’s
purpose: Equipping everyone with the
tools to bring joy to everyday cooking.
This purpose guides the Company’s
entire strategy and is reflected
throughout the organisation’s culture.
Group purpose
1 2 3 4 5
During the year the Group’s CMO led a
review of the Group’s purpose in order
to re-consider the principles, values
and customer promise that ProCook
seeks to live by. The aim was to create
a “North Star” to guide all the Group’s
activities, marketing and development
of culture. The Board reviewed
and discussed the Group’s refined
purpose, mission and accompanying
values shortly after the year end,
and this was launched internally to
colleagues in June. The Board expects
this new purpose will serve as a helpful
guide for future discussions and
decision-making in the years ahead.
s.172: Decision-making
In their consideration of the new
purpose, the Board discussed its
alignment to all stakeholder interests
and the Group’s existing medium-term
strategy which was prepared earlier
in the year. The Board agreed that it
consistently and concisely articulated
the Group’s strategic objectives.
The Board considered the impact on
colleagues, discussing the need to
bring the both the purpose and values
to life throughout the business through
training, visual signposting, internal
communications, and through the
behavioural values demonstrated and
evidenced in appraisal reviews. The
Board supported the colleague launch
and roll-out plan developed by the
Executive Directors.
The Board also discussed how the new
purpose would be communicated with
customers and agreed that the CMO
should either weave the purpose into
the Group’s marketing activities.
In the consideration of the new
Company values, the Board reflected
on the founder’s own principles and
style which are already embedded in
the culture, and how well these new
values align. The Board agreed that
they were consistent in the way the
ProCook operates with its stakeholders
including the way ProCook seeks to
treat suppliers fairly, and to give back to
the communities in which it operates.
Gourmet non-stick
cookware range
Group plc Annual Report and Accounts 202382
Strategy
The Board is keenly focused on
strategy and agendas are designed
to ensure that the Board dedicates
sufficient time to discussing and
debating those matters critical to
delivering strategic success. During
the year, the Board received strategy
updates from the Executive Directors
at each meeting, and these were
complemented by regular deep dives
into key areas of strategic focus.
Setting our strategy
1 2 3 4 5
The Board regularly reviews and
discusses strategy throughout the
year, including at its annual strategy
away-day where the key strategic
priorities and plans are discussed and
approved.
s.172: Decision-making
In approving the Group’s strategy,
and reviewing and challenging
performance since, the Board has
considered the impact of its plans and
activities across all stakeholders.
Market conditions and
oorttesoreaso
1 2
The CMO and CEO present market
updates on a regular basis to the Board,
allowing consideration and discussion
around market share, competitor
activity and timeliness of entering into
new markets or categories.
sesoa
During the year the Board decided to
withdraw from EU operations to focus
fully on the UK market recognising
the challenging trading environment
and considering the distraction and
projected lack of profitability of these
EU markets in early stage development.
The Board keeps this decision under
review acknowledging the significant
market opportunity in the UK.
stoerastoadreteto
1
The Board regularly monitors customer
metrics and has conducted deep
dive discussions on digital marketing
strategy and brand marketing,
customer acquisition and retention.
sesoa
The Board considered brand marketing
activities and determined that further
testing and trialling was required
in order to adequately understand
return on investment. Additionally,
the development of the Group’s
brand purpose and proposition was
considered necessary to ensure
marketing activities achieved the
desired cut-through in messaging.
Channel development
2
The strategy for new and upsize store
openings and website development
has been discussed regularly with
the Board, including in deep dive
strategy sessions. The Board regularly
reviews performance by channel,
and challenges management on
opportunities to make improvements.
sesoa
As a result of these reviews the Board
recommended that the Executive
team seek third party support to
assess the current and future retail
store estate in the UK to determine the
optimum size and location of stores in
the UK and to support future opening
decision- making. It also challenged
retail performance, identifying
the opportunity to invest more in
the development of our people.
Additionally, the Board committed
to modernising and re-designing the
website channel to provide a more
inspirational and stronger customer
experience, more akin to the retail
stores, and in order to generate
stronger returns for investors.
Product development
1 2
Designing and sourcing quality product
ranges that customers love to use, are
critical to the continued success and
growth, and remains a key focus for the
Board and Executive team. During the
year the Board has monitored progress
on new product development, including
the new category development in small
kitchen electricals.
sesoa
Consideration was given by the
Board to the quality, timing and
launch of the first and subsequent
ranges of small kitchen electricals,
encouraging the management team
to identify manufacturing partners
with experience of producing quality
products for customers, and to
develop a phased roll-out plan to
attract more customers to the brand
through the introduction of new ranges.
Supply Chain
3
Reducing inventory levels and
investing in new Distribution Centre
facilities were key priorities for the
Board in FY23. The Board regularly
reviewed reports on inventory position
and projections and approved the
investment case in the Group’s new
headquarters.
sesoa
As part of the new headquarters
investment case, the Board challenged
management on the financial returns
for investors, the impact on colleagues
and how they would benefit from the
new site, and the impact of the new site
on the local community.
Governance Report
Group plc Annual Report and Accounts 2023 83
Board activities Continued
Strategy continued
Technology
2
3
As a critical enabler for performance,
growth and operations, the Board
receives a Technology and Cyber-
security Report each meeting and has
held two deep-dive sessions on the
Tech strategy during the year.
s.172: Decision-making
The Technology roadmap is reviewed
each meeting by the Board and any
delivery challenges are discussed. The
Board supported the development
of additional security capability to
reduce risk for stakeholders during the
year in response to the Russian war in
Ukraine, and a range of customer and
operational investments including the
website technical re-platforming to
deliver greater customer experience
and stronger operational performance.
ESG strategy
1
2
3
4
5
ProCook aims to be a responsible
brand, with a strong ESG focus led by
our ESG Director who has reported to
the Board twice during the year and
presented progress updates on the
development of the environmental
management system, and the strategy
which the Board considered and
approved.
s.172: Decision-making
The Group’s ESG strategy is
recognised by the Board as important
to all stakeholders and therefore
requires continual focus and progress
being made in all areas. During the year
following a review of Group emissions
analysis the Board reviewed and
challenged the quality and compliance
of the supplier base, and the ability
of the Group to deliver on emission
reductions ambitions without their
engagement considering how this be
best moved forward.
People and culture
Making ProCook an even better place
to work is recognised by the Board and
Leadership Team as key to our success
and we are pleased to report that
during the year we were recognised as
a Great Place to Work TM and ranked
among the UK’s Best Workplaces for
Well-being for the second year running.
Colleague engagement
1
2
3
4
5
Annual colleague engagement results
and action plans are presented to
the Board by the People Director for
consideration and discussion.
s.172: Decision-making
The Board supported the action plan
in response to the FY23 engagement
survey which focused on improving
communication, enhancing reward and
benefits, and making improvements to
the clarity of operational activities for
Retail colleagues.
Talent recruitment, retention and
development
1
2
3
4
5
The Board reviews and discusses
People Reports at each meeting,
considering relevant metrics including
labour turnover and departmental
vacancies. Additionally, during strategy
deep dives, the Board considers
functional leadership capability and
development opportunities.
s.172: Decision-making
Following initial discussion at the
Nominations Committee, the Board
requested an assessment of talent
potential and succession planning,
identifying and agreeing a number of
areas of focus for the Executive team,
and leading to the appointment of the
Group’s first CMO.
Total reward
1
2
3
4
5
The Board receives and considers
regular updates from the People
Director, including opportunities to
enhance the total reward package for
our colleagues.
s.172: Decision-making
The Board considered the feedback
and recommendations and has
supported the Executive team in
making reward improvements to help
retain and attract the best quality talent
in particular through launching a holiday
buying scheme, the cost of living crisis
response to pay reviews, the Save As
You Earn scheme, and a new salary
sacrifice pension scheme which is
being introduced in July.
Colleague Advisory Panel
2
3
4
In accordance with the Code, the Board
has taken a blended approach and
launched the Colleague Advisory Panel
as well as appointing Luke Kingsnorth as
the designated Non-Executive Director
to oversee the Company’s engagement
with theworkforce.
s.172: Decision-making
Suggestions from colleagues have given
rise to fruitful Board discussions and
resulted in a number of tangible actions
around recognition, well-being and
reward being identified, supported by
the Board, and implementedpromptly.
Group plc Annual Report and Accounts 202384
Strategy:
1
Attracting more
customers to
our brand
2
Developing our
proposition
3
Building on our
strong foundations
4
Creating an even
better place to work
5
Reducing our
environmental
footprint
Stakeholder:
Customers Colleagues Suppliers Communities Shareholders
Governance
Financial performance
1
2
3
4
5
Financial performance was reviewed
and discussed by the Board at each
meeting, with detailed reviews
undertaken in respect of budgets,
reforecasts, long term financial plans
and interim and final results.
s.172: Decision-making
Budgets and reforecasts were carefully
scrutinised by the Board as the year
progressed and the adverse macro
backdrop intensified, impacting
trading performance. This led to two
market announcements reducing sales
and profit outlooks during the year.
The Board challenged the Group’s cost
base and supported the Executive
Directors’ actions to identify and
promptly implement cost savings; it
was agreed that an ongoing and robust
focus on cost is required.
Cash management and liquidity
1
2
3
4
5
In light of the challenging trading
conditions, the Board’s focus on
cash management was critical and
involved review of current position
and forecasts provided by the
CFO (including facility headroom
and covenant compliance) at each
meeting.
s.172: Decision-making
The Board supported the actions
taken to preserve cash while still
investing cautiously in the areas that
support long- term growth. The Board
supported and regularly monitored
the process to renegotiate facility
covenant terms with the Group’s
banking partner.
Risk management
1
2
3
4
5
The Group’s risk appetite is set by
the Board, and the framework of risk
management is reviewed by the Board
and Audit and Risk Committee.
s.172: Decision-making
The Board reviewed and rigorously
debated the principal risks, and
challenged progress made against
agreed risk management objectives
through the year to enhance the
control environment, particularly
focused on continual improvements to
financial controls following the IPO in
November 2021.
Board evaluation
1
2
3
4
5
The Group’s first Board effectiveness
evaluation was undertaken during
the year and the results reviewed and
discussed by the Board.
s.172: Decision-making
Consideration was given to the
feedback from the evaluation and the
Board agreed to enhance the quality of
discussions, reporting and decision-
making, by collectively and individually
being more candid, urgent and direct,
to ensure that actions are identified
and implemented with greater pace for
the benefit of all stakeholders.
Shareholder engagement
The Board is committed to maintaining
an open and constructive dialogue
with shareholders to ensure there
is a common understanding of the
strategic objectives, governance and
performance of the Company. The
Group has appointed financial public
relations advisers and corporate
brokers to gather investor and analyst
feedback, which is presented to and
reviewed by the Board.
s.172: Decision-making
The Board supports the CEO and CFO
as they undertake investor roadshows
following the release of financial
results and feedback through careful
review and consideration in advance of
messaging, presentations and results.
Whistleblowing and compliance
5
The Board is responsible for
monitoring and periodically reviewing
the Company’s whistleblowing,
anti-bribery and anti-fraud policies.
s.172: Decision-making
The Board is satisfied that sufficient
arrangements are in place to protect
stakeholders’ interests and assist
in the prevention of fraud, enabling
colleagues to report irregularities
confidentially and allow appropriate
investigation and follow-up action
tobe taken.
Corporate Governance
The Board is responsible for
compliance with the UK Corporate
Governance Code and considers and
discusses regular updates from the
Company Secretary at boardmeetings.
s.172: Decision-making
The Board is satisfied that it operates
in compliance with the Code, and that
sufficient arrangements are in place
to protect stakeholders’ interests
asawhole.
Governance Report
Group plc Annual Report and Accounts 2023 85
Nomination Committee Report
Dear Shareholder,
I am pleased to present ProCook’s
Nomination Committee (‘Committee’)
Report to shareholders for the
year ended 2 April 2023. During
the year the Committee reviewed
and recommended changes to
the composition of the Board and
senior management team; discussed
long-term succession planning and
development of the Executive pipeline
and recommended the recruitment of a
Chief Marketing Officer (‘CMO’).
Throughout the year, the Executive
Directors have also been invited to
attend Committee meetings and have
provided the Committee with valuable
insight into the resourcing needs of
the business and actions being taken
to ensure the necessary skills and
experience are in place to drive the
Company’s strategy forward. Given
the various challenges the business
has faced in the year, it has been an
active year for the Committee. Most
notably, we took the difficult decision
to recommend that the size of the
Board be reduced to 5, having started
the year with a cohort of 7. We have also
initiated a formal search for the CEO’s
eventual successor. I write more about
these activities on the following pages.
Key responsibilities
The purpose of the Committee
is to establish a formal, rigorous,
and transparent procedure for the
appointment of new directors to the
Board, as required by the UK Corporate
Governance Code (the “Code”). The
Committee’s main responsibilities, as
outlined in its terms of reference, are:
• Reviewing the structure, size
and composition (including the
skills, knowledge, experience and
diversity) of the Board and making
recommendations to the Board with
regard to any changes.
• Ensuring plans are in place for
orderly succession to Board and
senior management positions and
overseeing the development of a
diverse pipeline for succession.
• Reviewing the leadership needs of
the organisation, both Executive
and Non-Executive, with a view to
ensuring the continued ability of the
organisation to compete effectively
in the marketplace.
• Identifying and nominating, for the
approval of the Board, candidates
to fill Board vacancies as and when
they arise.
• Evaluating the balance of skills,
knowledge, experience and diversity
on the Board, and, in light of this
evaluation, preparing a description of
the role and capabilities required for
a particular appointment.
• Reviewing the time required
from Non-Executive Directors.
Performance evaluation is used to
assess whether the Non-Executive
Directors are spending enough time
fulfilling their duties.
Read more:
The Committee’s terms of reference are
available on the Company’s website at
www.procookgroup.co.uk
Read more:
The skills and experience of all Committee
members can be found on pages 78 to 79.
Read more:
Committee meeting attendance is set out
on page 77.
Members
• Greg Hodder – Chair
• David Stead – Member
• Luke Kingsnorth – Member
The Committee also included Gillian Davies until her resignation from the Board
on 1December 2022.
Group plc Annual Report and Accounts 202386
Diversity and Inclusion
Policy Statement
The Board recognises the benefits
of diversity in its broadest sense and
believes that the Board’s capabilities
are improved by a diverse balance of
skills, expertise, gender, ethnicity, and
professional and social backgrounds.
Together, this brings the widest
possible breadth of perspectives,
insights and challenge to the decision-
making process, ultimately ensuring
the Board and senior management are
equipped to promote the long-term
success of the Company.
The Board supports the
recommendations set out in the FTSE
Women Leaders Review on gender
diversity and the Parker Review on
ethnic diversity.
The Group’s policy on Diversity and
Inclusion is available on the Company’s
website.
Objectives and Progress
Supported by the Nomination
Committee, the Board will:
• Consider all aspects of diversity,
including gender and ethnicity,
when reviewing the composition
and balance of the Board and
when conducting the annual Board
effectiveness review.
• Only engage Executive search firms
who have signed up to the Voluntary
Code of Conduct on gender diversity
and best practice.
• Encourage and monitor the
development of internal high calibre
employees including considering all
aspects of diversity to help support
the internal talent pipeline for
succession at both Board and senior
management level.
• Ensure that candidate lists for Non-
Executive Director positions are
compiled by drawing from a broad
and diverse range of candidates,
including those who may not have
previous listed company experience
but who possess suitable skills or
qualities.
Unfortunately, the gender diversity of
the Board suffered during the year due
to the resignation of Gillian Davies (for
background and context please refer
to “Board composition” below) and
we have not yet met the FCA targets
of 40% female representation on the
Board, one senior Board position being
occupied by a female, and one ethnic
minority member.
On a positive note, we are pleased
to have made progress towards a
more diverse senior leadership team.
Three out of the seven members
(42.9%) are now female, including the
key role of CMO, who now regularly
attends Board meetings and has
been instrumental in bringing focus
to the Company’s marketing strategy
and implementation. Although not a
solution to the lack of Board diversity,
the Committee feels that the CMO’s
contributions offset the issue to some
extent, while also offering the potential
to develop future female Board
members within the Company.
Gender balance of senior management
and direct reports
The gender balance of the Board is
shown on page 79. The gender balance
of the Leadership Team is included
in the Sustainability section of the
Strategic Report on page 32.
Board composition
The Committee was keenly focused
on Board composition and succession
this year. Following the announcement
that the Company’s Chief Operating
Officer (‘COO’), Steve Sanders,
intended to retire, the Committee
reviewed and proposed changes to
the structure of the Board and senior
management teams and, as part of
this, agreed that in future the COO role
(should the Company wish to retain a
COO) would not be a Board position.
Consequently, the Committee
considered whether it was in the best
interests of the Company to continue
to have three Non-Executive Directors
on the Board and concluded that,
provided the Board had the necessary
skills and expertise to meet the needs
of the Company, it would be beneficial
for one of the Non-Executive Directors
to stand down. Particularly given that
headcount reductions were being
made across the business at the time,
it was agreed that it would be fair and
equitable for the same rigour to be
applied to the Board.
The Committee carefully examined
the skills and experience of the Non-
Executive Directors and noted areas
of duplication of expertise. Following
consideration, Gillian Davies indicated
a willingness to step down, following
which the Committee agreed that
those skills and experience would
be sufficiently covered by the other
Non-Executives, save for the fact that
this would result in an all-male Board.
However, taking all things into account,
it was agreed by the Committee, and
ultimately the Board, that this course of
action was in the best interests of the
Company.
Succession planning
The Board has delegated responsibility
to the Committee for leading the
process for identifying and nominating
Board candidates, as well as keeping
the diversity of the Board under review.
When making a Board appointment,
the Committee will seek to identify an
individual with the skills, knowledge
and experience required to fulfil the
role, taking account of the added value
that the individual brings to the Board
in terms of creating a diverse, and
therefore more effective, decision-
making body.
The Committee also has responsibility
for oversight of the development
of a diverse pipeline of potential
Directors and senior managers. This is
supported by the Group’s Diversity and
Inclusion Policy described on page 31,
which aims to ensure that ProCook’s
workforce is truly representative of all
aspects of society and that employees
feel involved, valued and respected.
Group plc Annual Report and Accounts 2023 87
Governance Report
During the year, the Committee
reviewed and challenged the structure
of the Company’s senior management
team. We supported the Executive
Directors both in and outside the
Boardroom and, after much discussion,
agreed on a number of changes to role
descriptions and reporting lines. Most
notably, the role of CMO was created,
reporting to the CEO.
CEO search
As previously communicated, it has
been Daniel O’Neill’s intention to
step back from the CEO role at an
appropriate point. In February this year,
Daniel discussed the timing of this
with the Committee and it was agreed
that the business had reached a stage
where he could begin thinking about
making this transition in the medium
term. Having founded ProCook over
twenty years ago, Daniel’s knowledge
of the business is unparalleled, and it is
his intention to continue to add value by
supporting the product development
team on a part-time basis.
In March 2023, following a tender
process, we engaged Korn Ferry to
lead the CEO search and agreed on
the skills, experience and personal
characteristics required for the
role. Korn Ferry is a signatory to the
Voluntary Code of Conduct on gender
diversity and best practice and the
Committee requested that a long list
of diverse candidates be drawn up for
the Committee’s consideration. At the
time of writing, the search is ongoing,
and we will report to shareholders in
due course. Neither the Board nor any
of the individual Directors have any
connection with Korn Ferry.
Election and re-election of
Directors
In accordance with the Code and the
Company’s articles of association,
all Directors will offer themselves for
election by shareholders each year
at the Company’s Annual General
Meeting. Both the Committee and the
Board are satisfied that all Directors
continue to be effective in, and
demonstrate commitment to, their
respective roles on the Board and that
each makes a valuable contribution to
the leadership of the Company. The
Committee therefore recommends
that shareholders vote in favour of all
Directors’ re-election at the AGM.
Priorities for FY24
Over the coming year, the Committee
will focus on the search for a successor
to the CEO role and in doing so will
have due regard to diversity in all its
forms including gender, ethnicity
and background. The Committee
will continue to keep the size and
composition of the Board and its
Committees under review to ensure
these remain appropriate to the needs
of the business.
Greg Hodder
Nomination Committee Chair
27 June 2023
Nomination Committee Report
Continued
Reactive Grey
Cast Iron
Group plc Annual Report and Accounts 202388
Dear Shareholder,
I am pleased to present the report
of the Audit and Risk Committee
(‘Committee’) for the year ended 2
April 2023. The principal focus of the
Committee has been on supporting
and guiding the Executive Directors
as they continued to enhance
internal controls while also dealing
with commercial headwinds. The
macroeconomic uncertainty seen
in FY22 showed little sign of abating
during the year, with the war in Ukraine
and high levels of inflation continuing to
suppress consumer confidence. In the
context of this heightened commercial
risk, the Committee continued to
challenge and support management
through the changeable environment
that persists for retail businesses.
As discussed further in the Nomination
Committee report, the Board was
scaled down during the year and,
as part of this, Gillian Davies retired
as a Director and as Audit and Risk
Committee Chair following the release
of the Company’s FY23 interim results
in December, at which point I stepped
into the role. I’d like to thank Gillian for
her diligent and effective leadership of
the Committee during her tenure.
Key responsibilities
The Committee’s key responsibilities,
as outlined in its terms of
reference, are:
• Monitoring the integrity of the
financial statements of the Company
and any formal announcements
relating to financial performance.
• Reviewing the adequacy and
effectiveness of the Company’s
internal financial reporting and
internal control policies and systems.
• Overseeing the Company’s
arrangements for its people to raise
concerns, in confidence, about
possible wrongdoing in financial
reporting or other matters.
• Reviewing the Company’s
procedures for detecting fraud
and preventing bribery and
moneylaundering.
• Overseeing the effectiveness and
performance of the external Auditor
and making recommendations to the
Board regarding their appointment
or removal.
• Advising the Board on the
Company’s overall risk appetite,
tolerance and strategy, and principal
and emerging risks.
• Monitoring and reviewing the
effectiveness of the Company’s risk
management framework.
The Committee’s terms of reference
are available on the Company’s
corporate website.
How the Audit and Risk
Committee discharges its
responsibilities
The Committee has unrestricted
access to Company documents and
information as well as to employees of
the Company and the external Auditor.
The Audit and Risk Committee Chair
meets regularly with the Chief Financial
Officer. Members of the Committee
may, in pursuit of their duties, take
independent financial advice on any
matter, at the Company’s expense.
The Audit and Risk Committee Chair
reports the outcome of Audit and Risk
Committee meetings to the Board.
The Audit and Risk Committee meets
at least three times a year and has an
agenda linked to the events in the
Group’s financial calendar.
Significant items considered
during the year
Internal controls
Management provided an update on
internal controls at each Committee
meeting, which allowed the Committee
to interrogate and provide input on
improvements in the following areas:
• Period-End Control Framework
• Tax Governance
• Payment Practices Reporting
• Procure to Pay
• Annual review of FPPP
Audit and Risk Committee Report
Composition of the Audit and Risk Committee
• David Stead – Chair
• Luke Kingsnorth – Member
The Audit and Risk Committee was chaired by Gillian Davies until her resignation
from the Board on 14 December 2022.
The qualifications and experience of all Committee members can be found
on pages 78 to 79. All members of the Committee have recent and relevant
financial experience and the Committee as a whole has competence relevant
to the retail sector.
Committee meetings are routinely attended by the Chairman of the Board,
Chief Executive Officer, Chief Financial Officer, and the external Auditor.
The Committee also meets separately with the external Auditor without
management present at least annually. Committee meeting attendance is set
out on page 77.
Group plc Annual Report and Accounts 2023 89
Governance Report
Audit and Risk Committee Report
Continued
• Corporate Criminal Offence
• Cash and treasury
• Capex controls
• Business continuity
Finance team
As a Committee, we continued to
bringour collective eperience to
bearinsupporting management
in the further development of the
Finance team. At the request of the
Committee, management continued
toprovide detailed team updates to
theCommittee on a regular basis.
ooeradat
assessment
In preparation for the publication
of the Company’s FY23 financial
statements, the Committee conducted
a comprehensive review of the going
concern position. Management
prepared a paper setting out the
methodology and assumptions
used for the assessment of going
concern and viability, summarising
projected performance over a three-
year forecast period, together with
sensitivity analysis. The Committee
discussed the assumptions and results
indetail, including:
• The assumptions driving the base
case projections
• Results of the severe but plausible
downside scenarios
• The results of the stress tests
undertaken
• The variability and fixed nature of the
cost base
• The profile of projected cash flows
under each scenario and stress test,
and any areas where cash headroom
may become tighter
• The available finance facilities and the
impact of the scenarios and stress
tests on meeting covenant tests
• The mitigations available to
management should they be needed
Following this detailed review, the
Committee noted that under the
severe but plausible downside scenario
which they have reviewed, the Group
is likely to breach its fixed charge
covenant. In the base case scenario,
and in the other downside scenarios
which the Committee reviewed,
this covenant is not breached. The
Committee therefore acknowledged
and confirmed to the Board that this
potential breach represents a material
uncertainty which may cast significant
doubt on the Group’s ability to
continue as a going concern.
The Committee considered the
likelihood of such a severe downside
scenario materialising to be low and
recognised the range of mitigating
actions available to the Group to
prevent such a breach occurring,
and the positive and long-standing
relationship which the Group has
with its banking partner HSBC. The
Committee therefore confirmed to
the Board that they were satisfied
that the Group should adopt the
going concern basis of accounting in
preparing the financial information for
the year ended 2 April 2023 and that
there was a reasonable expectation
that the Group has adequate resources
to continue in operational existence
for the foreseeable future and will be
able to continue in operation and meet
its liabilities as they fall due over the
viability assessment period.
Financial statements and significant
financial judgements
The Committee considered, in
particular, the following matters, as
identified by the Auditor, in relation
to the Group’s half-year and full-year
financial statements:
• Impairment of GGUs and investments
• Critical accounting judgements and
estimates
• IFRS 16 – Leases
• IFRS 2 – Share-based payments
• Going concern and viability
Internal controls
The Committee is responsible for
reviewing the Company’s internal
financial controls and internal control
management systems and the Board is
ultimately responsible for establishing
procedures to oversee the internal
control framework.
The Committee received updates
on improvements to the Company’s
internal controls at each of its
meetings and has, on behalf of the
Board, considered the effectiveness
of the internal control systems and
risk management processes in place
during the year.
Risk management systems
The Board is responsible for the
Group’s risk management framework
and the Committee has been
delegated responsibility for reviewing
the overall process of assessing
business risks and managing the
impact on the Group. The Board retains
overall responsibility for the level of
risk the Group is willing to take and for
allocating sufficient resource to the
management of business risk.
The Leadership Team reviews the
Company risk register regularly and
reports any proposed changes to the
Audit and Risk Committee and the Board.
As part of the ongoing assessment
of the business’ principal risks and
uncertainties, the Committee has
considered several factors including
macroeconomic uncertainty, supply
chain concentration and disruption,
the Ukraine conflict, climate change,
aswell as cyber and technology risks.
The principal risks and uncertainties
of the Group and their mitigation
are included on pages 60 to 71. The
crystallisation of these risks has been
considered in the Viability Statement
on page 112 and Going Concern
Assessment on pages 126 to 128.
Annual Report and Accounts
and results announcements
During the year, the Committee
formally reviewed draft interim and full
year results announcements and the
Annual Report and Accounts. These
reviews considered:
• The accounting principles, policies
and practices adopted in the Group’s
financial statements and proposed
changes to them.
• Significant accounting issues and
areas of judgement and complexity.
• The integrity of the financial and non-
financial information.
The Committee was satisfied with
management’s presentation of the
FY23 interim and full year results and
Group plc Annual Report and Accounts 202390
announcements and the Annual Report
and Accounts.
The External Auditor confirmed to
management that they were not aware of
any material unadjusted misstatements
during the course of their audit.
The Committee has reviewed
the Annual Report and Financial
Statements and is satisfied that, taken
as a whole, they are fair, balanced
and understandable and provide
shareholders with the necessary
information to assess the Group’s
position and performance, business
model and strategy, and should be
recommended to the Board.
External Auditor
The Committee oversees the Group’s
relationship with the external Auditor and
makes recommendations to the Board
concerning the Auditor’s appointment,
re-appointment and remuneration.
Mazars LLP was appointed as the Group’s
Auditor during 2021 prior to the IPO and
its audit of the Group is in respect of
these financial statements for the year
ended 2 April 2023. Charlene Lancaster
is the Audit Partner. The Committee
intends to comply fully with the FRC
Guidance on External Auditors and carry
out an audit tender at least every ten
years and mandatory rotation at least
every 20 years.
The Committee considers at least
annually the independence and
objectivity of the Auditor, taking
into consideration the relevant
UK professional and regulatory
requirements. In March 2023 the
Committee reviewed a statement from
the Auditor detailing its independence
policies and safeguards and confirming
its independence. Following this
review, the Committee agreed that the
Auditor is independent.
The Committee has considered and
approved the terms of engagement
and fees of the Auditor in respect
of the audit of the accounts for the
year ended 2 April 2023. Audit fees
payable by the Group to Mazars LLP
during the year totalled £394k. There
were no contingent fee arrangements.
Mazars LLP was appointed to carry
out certain Agreed-Upon Procedures
of the Group’s financial information
for the 28-week period ended 17
October 2022. The provision of an
Agreed-Upon Procedures review is a
permissible audit-related service under
the FRC’s Ethical Standard 2019. The
fee for the Agreed-Upon Procedures
review was significantly below the 70%
cap mandated by the FRC’s Ethical
Standard. The ratio of non-audit fees to
audit fees for the year was 1:40.
The Committee has approved a non-
audit services policy and confirms that
the work carried out by the Auditor
to date has been in accordance with
thatpolicy.
To fulfil its responsibility regarding the
effectiveness of the external Auditor
and oversight of the audit process,
principal procedures carried out by the
Committee include:
• Review of the relevant skills and
experience of the audit partner
and team
• Review of the Auditors’ planning
report detailing scope of the audit,
materiality and identification of areas
of audit risk
• Consideration of formal reports from
the Auditor about the audit process,
issues which arose during the audit
and their resolution, key accounting
issues and judgements
• Consideration of recommendations
made by the external Auditor in
their management letters and
the adequacy of management’s
response.
Based upon its reviews the Committee
has recommended the reappointment
of Mazars LLP, as external Auditor, to
the Board.
The Committee has reviewed the letter
from the FRC regarding its review of
Mazars LLP audit of ProCook Group
plc for the year ended 3 April 2022.
The letter highlights that results were
satisfactory, and the Committee
has discussed with Mazars the
limited number of improvements
recommended by the FRC, alongside
the actions that they have taken.
Internal audit
During the year, the Group did not
have an internal audit function as it
had been agreed that the Group’s size
and activities were such that internal
assurance was achievable through
other means, including the close
involvement of the Executive Directors
in the day-to-day running of the Group
and regular reviews by management of
detailed management information.
The Committee has concluded
that regular reporting from and
discussions with management remain
an appropriate means of obtaining
assurance as to the effectiveness of
the Group’s internal controls, given the
size and complexity of the Group, and
that a permanent internal audit function
is therefore not required at this time.
The Committee will review this position
at least annually.
Annual evaluation
During the year the Board conducted
an internal evaluation of the
effectiveness of the Board and its
Committees. The review highlighted
that the Committee and its Chair
perform effectively and there were no
material concerns to report.
Priorities for FY24
During the forthcoming year, the
Committee will continue to support
and challenge management through
the evolution of the Group’s internal
controls framework, as well as ensuring
that risks are appropriately managed.
David Stead
Audit and Risk Committee Chair
27 June 2023
Group plc Annual Report and Accounts 2023 91
Governance Report
Remuneration Committee Report
Dear Shareholder,
Having become Chair of the
Remuneration Committee during 2022,
I am pleased to present the Directors’
Remuneration Report for theyear
ended 2 April 2023. The report, in line
with UK reporting regulations, is divided
into three sections:
• This annual statement, which
summarises the work of the
Committee and our approach
toremuneration.
• The Directors’ Remuneration Policy,
which summarises the policy
approved by shareholders at the
2022 Annual General Meeting.
• The annual report on remuneration,
which sets out the remuneration
arrangements and incentive
outcomes for FY23, and how the
Committee intends to implement the
new remuneration policy in the FY24
financial year.
• As no changes are proposed to the
directors’ remuneration policy, we
will present only one remuneration-
related resolution at our forthcoming
Annual General Meeting, relating
to the advisory vote on the annual
statement and the annual report
onremuneration.
I have summarised our approach on
these below and further details can
be found in the Remuneration Report.
I hope you find this report and our
Remuneration Policy clear and that you
will give your support when voting at
our AGM.
I would like to thank my former
colleague Gillian Davies who stepped
down from the Board during the year,
for her hard work and dedication as a
member of the Committee. I would
also like to thank David Stead for
Chairing the Committee effectively
since IPO and for the continuing
support now asamember of
theCommittee.
Remuneration for FY23
For the financial year the Group
delivered total revenue of £62.3m
(9.9% year-on-year decline) and
underlying loss before tax of £0.2m
(FY22: £9.5m profit).
This performance is reflective of
the challenging trading conditions
faced during the year which have
been impacted by the high level
of inflation and resulting fall in real
disposableincomes.
Reflecting the difficult trading
environment, both the Executive and
Non-Executive members of the Board
volunteered a reduction in salary/fees
with effect from October 2022 to April
2023. This resulted in a 27% reduction
in salary over the full year for the Chief
Executive Officer and ranged from
5% to 10% for the other members of
the Board.
Against the stretching targets set, the
outturn for underlying profit before
tax is below the level of performance
required under the Annual Bonus Plan
and therefore there is no bonus being
awarded to the Executive Directors
in respect of FY23. Further details
of performance against the relevant
targets can be found on page 103 of
thisreport.
There were no long-term
incentives vesting in relation to
F23performance.
No Committee discretion has been
applied to remuneration outcomes.
Committee Members
• Luke Kingsnorth - Chair
• Greg Hodder - Member
• David Stead - Member
Focus areas for FY23
• Review ongoing implementation of the Policy to ensure it operates as
intended.
• Monitor developments in best practice.
Group plc Annual Report and Accounts 202392
Directors’ Remuneration
Policy
In the lead up to admission, the
proposed Directors’ Remuneration
Policy was considered carefully
to ensure that, after admission,
it incentivises and rewards long-
term, sustainable growth of the
Company, complies with the UK
Corporate Governance Code and
is in line with market best practice
and the guidelines of UK institutional
shareholders and advisory bodies.
The policy is designed to provide
market- competitive remuneration for
the achievement of stretching targets.
The incentives are intended to reward
for achieving the long-term business
strategy, with a significant proportion
payable in shares, which must be
heldlong term.
These arrangements were formally
approved by shareholders at the 2022
AGM with a 99.99% vote in favour of the
resolution to approve the Directors’
Remuneration Policy.
A summary of the Remuneration Policy
which will continue unamended for
FY24 is set out on pages 94 to 101.
The Committee does however wish
to make a change to the current share
dilution limits. The existing plans
operate with standard 5% and 10%
in 10-year dilution limits. The current
discretionary plan limit of 5% is
creating a headroom issue given the
current market capitalisation of the
Company. It is therefore proposed
that the relevant scheme rules will be
amended to remove the the 5% in
10-year discretionary plan limit, whilst
retaining the total 10% in 10-year limit.
A resolution to adopt the revised limit
will be proposed to shareholder at
the AGM.
Board changes
Following the announcement in
September 2022 that Steve Sanders
would be retiring from the Group,
he stood down from the plc Board
on 1December 2022, although he
continued in his role as Chief Operating
Officer until 31 March 2023, as
previously announced. Full details of
Steve’s leaving arrangements, which
are in line with our Policy, can be found
in this report.
As announced in October 2022, Gillian
Davies also resigned from the Board on
14 December 2022.
Implementation of the
Remuneration Policy for FY24
The Remuneration Committee intends
to operate the Remuneration Policy for
FY24 as follows:
Base salaries
Salaries on admission were set at
£300,000 for the CEO and £250,000
for the CFO. The CEO salary will remain
unchanged, and the CFO’s salary will
increase to £260,000, reflecting an
inflationary increase of 4%. The wider
workforce average increase for the
period is 8.9%.
Pensions/benefits
A defined contribution/ salary
supplement of 3% of salary will be
offered to the current Executive
Directors, together with a standard
suite of other benefits.
Annual bonus
For FY24, the maximum annual bonus
is 100% of salary and payments will
be based on 30% underlying profit
before tax performance, 30% revenue,
30% free cash flow and 10% colleague
engagement score. 25% of any bonus
will be deferred into shares for 2 years.
Long-term incentives
A further award is expected to be made
in July 2023 under the Performance
Share Plan (“PSP”). Award levels will
be set at a maximum of 100% of
salary for the Executive Directors.
Performance targets will be based
on EPS performance over the
performanceperiod.
The Committee believes that the above
approach takes due account of market
and best practice and, importantly,
also reflects and supports ProCook
Group’s strategy and promotes the
Company’s long-term success.
Wider ProCook Team
The Group’s employees are critical to
the development of the business and
the Remuneration Committee takes an
active interest in the wider employee
base. The Committee is made aware
of pay and employment conditions
throughout the Group and is mindful
of this when making decisions on
Executive pay. It also is responsible for
reviewing wider all-employee pay.
Participation in the Company’s SAYE
Scheme is offered to all employees
and the second offer was launched in
January 2023 with the awards granted
on 15 February 2023. 86 colleagues
took up the offer, and when combined
with the participation under the IPO
Employee Share Plan means that a very
substantial proportion of the workforce
have a direct interest in the share price
performance of the Company. The
Group intends to continue to offer
subsequent SAYE grants annually.
On behalf of the Committee, thank
you for reading this report and we look
forward to receiving your support at the
forthcoming AGM in relation to the pay-
related resolution.
Luke Kingsnorth
Remuneration Committee Chair
27 July 2023
Group plc Annual Report and Accounts 2023 93
Governance Report
Directors’ Remuneration Policy
This section sets out the Company’s Directors’ Remuneration Policy which has been prepared in accordance with the Large
and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, as amended in 2013, 2018 and 2019.
The Directors’ Remuneration Policy was put to a binding shareholder vote at our 2022 Annual General Meeting and took
formal effect from that date. The policy will formally apply for three years unless a new policy is presented to shareholders
before then.
The Committee has ensured that the Directors’ Remuneration Policy and practices are consistent with the six factors set out
in Provision 40 of the Corporate Governance Code:
Clarity
Our Directors’ Remuneration Policy is well understood
by our senior Executive team and is clearly articulated to
our shareholders and representative bodies.
Simplicity
The Committee is mindful of the need to avoid overly
complex remuneration structures which can be
misunderstood and deliver unintended outcomes.
Therefore, a key objective of the Committee is to ensure
that our Directors’ Remuneration Policy and practices
are straightforward to communicate and operate.
Risk
Our Directors’ Remuneration Policy has been designed
to ensure that inappropriate risk-taking is discouraged
and will not be rewarded via (i) the balanced use of
both annual incentives and long-term incentives which
employ a blend of targets, (ii) the significant role played
by shares in our incentive plans (together with bonus
deferral and shareholding guidelines) and (iii) malus/
clawback provisions within all our incentive plans.
Predictability
Our incentive plans are subject to individual caps, with
our share plans also subject to standard dilution limits.
The use of shares within our incentive plans results
in actual pay received being highly aligned to the
experience of our shareholders.
Proportionality
There is a clear link between individual awards, delivery
of strategy and our long-term performance. In addition,
the significant role played by variable pay, together
with the composition of the Executive Directors’
service contracts, ensures that poor performance is not
rewarded.
Alignment to culture
Our Executive pay policies are fully aligned to the
Company’s culture through the use of metrics in both
the annual bonus and PSP that measure how we perform
against key aspects of our strategy, which has the
objective of delivering sustainable growth in profitability.
The following table summarises the key aspects of the Directors’ Remuneration Policy:
Executive Directors
Purpose and link to strategy Operation Maximum opportunity Performance measures
Base salary
To provide competitive fixed
remuneration.
To attract and retain Executives
ofa superior calibre.
Base salaries will be reviewed
each year by the Committee.
The Committee does not strictly
follow data but uses market data
for similar roles in comparable
companies as a reference point
in considering, in its judgement,
the appropriate level of salary
having regard to other relevant
factors including corporate and
individual performance and any
changes in an individual’s role and
responsibilities.
While there is no prescribed
maximum salary or increase,
it is anticipated that salary
increases will normally be in
line with increases to the wider
workforce salaries. However, in
certain circumstances (including,
but not limited to, changes in
role and responsibilities, market
levels, individual and Company
performance), the Committee
may make larger salary increases
to ensure they are market
competitive. The rationale for any
such increase will be disclosed
in the relevant Annual Report on
Remuneration.
n/a
Group plc Annual Report and Accounts 202394
Purpose and link to strategy Operation Maximum opportunity Performance measures
Benefits
To provide competitive fixed
remuneration.
To attract and retain Executives
ofa superior calibre.
Executive Directors are entitled to
benefits, including life assurance.
Executive Directors will be eligible
for any other benefits which
are introduced for the wider
workforce on broadly similar
terms, and for other benefits
that might be provided based
on individual circumstances,
if the Committee decides it is
appropriate.
For external and internal
appointments or relocations,
the Company may pay certain
relocation or incidental expenses
as appropriate (for up to two years
from recruitment).
Any reasonable business-related
expenses can be reimbursed (and
any related tax met if determined
to be a taxable benefit).
Executive Directors can also
participate in all-employee share
plans on the same basis as other
employees.
As it is not possible to calculate in
advance the cost of all benefits, a
maximum is not pre-determined.
The maximum level of participation
in all-employee share plans is
subject to the limits imposed by
the relevant tax authority
n/a
Pension
To provide employees with
long-term savings to allow for
retirement planning.
Executive Directors can receive
a contribution to a pension
arrangement or a cash payment
in lieu.
The maximum defined
contribution or cash allowance
in lieu of pension is limited to the
contribution level available to
most other employees, which is
currently 3% of base salary.
n/a
Annual Bonus Plan
Rewards achievement of annual
financial and business targets
aligned with the Group’s KPIs.
Bonus deferral encourages
long- term shareholding,
supportsretention and
discourages excessive risk
taking.
Awards are based on
performance, typically measured
over one year.
Pay-out levels are determined by
the Committee after the year end
based on performance against
pre-set targets.
Bonus is normally paid in cash,
except not less than 25% of any
bonus which is deferred into
an award under the Deferred
Bonus Plan (“DBP”), typically for
a two-year period. The level of
deferral and period for deferral
may change in relation to future
financial years.
Dividend equivalents may accrue
on deferred shares.
The vesting of deferred shares
is not subject to any additional
performance conditions.
Provisions are included which
enable the Committee (in respect
of both the cash and the deferred
elements of bonuses) to recover
or withhold value in the event of
certain defined circumstances
(that is, in cases of misconduct,
material misstatement of financial
results, error in calculation of a
bonus payment and reputational
damage).
The normal maximum level of
Annual Bonus Plan outcomes is
100% of base salary per annum.
The normal maximum will only
be exceeded in exceptional
circumstances and is subject to
anoverall limit of 200 of salary
ina financial year.
Targets are set annually with
measures linked to our strategy
and aligned with key financial,
strategic and/or individual
targets.
The performance measures for
FY24 are set out on page 107.
The performance measures
applied may be financial or non-
financial, corporate, divisional
or individual, and in such
proportions as the Committee
considers appropriate.
A graduated scale of targets is
set for each measure, with no
pay-out for performance below
the threshold level.
The Committee has the
discretion to amend the
pay-out should any formulaic
outcome not reflect its
assessment of overall business
performance.
Group plc Annual Report and Accounts 2023 95
Governance Report
Directors’ Remuneration Policy
Continued
Purpose and link to strategy Operation Maximum opportunity Performance measures
Long-term incentives
To incentivise Executive
Directors and deliver long-term
performance-related pay, with a
clear line of sight for Executives
and direct alignment with
shareholders’ interests.
Awards will be in the form of nil-
cost share options.
Awards will be granted with
vesting dependent on the
achievement of performance
conditions set by the Committee,
with performance normally
measured over at least
three years.
Awards will be subject to a two-
year holding period following the
end of the performance term,
with options typically not being
exercisable by participants until
the end of the holding period.
Dividend equivalents may accrue
on awards, to the extent they vest.
The PSP includes provisions which
enable the Committee to recover
or withhold value in the event of
certain defined circumstances
(that is, in cases of misconduct,
material misstatement of financial
results, error in calculation of a
vesting level and reputational
damage).
The normal maximum PSP award
is 100% of salary in a financial
year. The normal maximum will
only be exceeded in exceptional
circumstances and is subject to an
overall limit of 200% of salary in a
financial year.
PSP performance measures
may include financial and
shareholder value metrics as
well as strategic, non-financial
measures.
The performance measures
for FY24 are set out on page
107. The Committee retains the
discretion to set alternative
measures and weightings
for awards over the life of the
policy.
Targets are set and assessed by
the Committee on its discretion.
A maximum of 25% of any
element vests for achieving the
threshold target, with 100% for
maximum performance.
The Committee has the
discretion to amend the vesting
level should any formulaic
outcome not reflect its
assessment of overall business
performance.
Share ownership guidelines
To align with shareholders’
interests and to foster a long-
term mindset.
Executive Directors are required
to retain all shares that vest, net of
any tax liability, under the PSP and
DBP awards until the guideline is
met. Any share plan awards that
have vested but are subject to
a holding period and any shares
subject to awards under the DBP
will be credited for the purpose
of the guidelines (discounted for
anticipated tax liabilities).
Executive Directors will
be required to maintain a
shareholding in the Company for
a two-year period after stepping
down from that position, being
the full value of the shareholding
requirement or the Executive
Director’s actual relevant
shareholding at leaving this
position if lower.
200% of base salary for all
Executive Directors.
n/a
All-employee share plans
To encourage share ownership
by employees, thereby allowing
them to share in the long-term
success of the Group and align
their interests with those of the
shareholders.
These are all-employee share
plans established under HMRC
tax-advantaged regimes
and follow the usual form for
such plans.
Executive Directors will be able to
participate in all-employee share
plans on the same terms as other
Group employees.
The maximum participation levels
for all-employee share plans
will be the limits for such plans
contained in their rules which are
set by HMRC from time to time.
Consistent with normal
practice, such awards will not
be subject to performance
conditions.
Group plc Annual Report and Accounts 202396
Chair and Non-executive Directors
Purpose and link to strategy Operation Maximum opportunity Performance measures
Chair/Non-executive
Director fees
To enable the Company to recruit
and retain Chairs and Non-
executive Directors of the highest
calibre, at the appropriate cost.
The fees paid to the Chair and
Non-Executive Directors aim to be
competitive with other fully listed
companies of equivalent size and
complexity.
The fees payable to the
Non-executive Directors are
determined by the Board, with the
Chair’s fees determined by the
Committee.
The Chair and Non-executive
Directors will not participate
in any cash or share incentive
arrangements.
The Company reserves the right
to provide benefits (including
travel and office support) to
the Chair and Non-executive
Directors where appropriate.
Should any assessment to tax be
made on such reimbursement, the
Company reserves the ability to
settle such liability on behalf of the
Chair or Non-Executive Director.
The aggregate fees (and any
benefits) of the Chair and Non-
executive Directors will not
exceed the limit from time to time
prescribed within the Company’s
Articles of Association.
If the Chair and/or Non-executive
Directors devote special attention
to the business of the Company,
or otherwise perform services
which in the opinion of the
Directors are outside the scope of
the ordinary duties of a Director,
they may be paid such additional
remuneration as the Directors or
any Committee authorised by the
Directors may determine.
n/a
Notes to the policy table
Legacy arrangements
In approving this remuneration policy,
the Company has the authority to
honour any previous commitments
entered into with current or former
directors (such as the payment of a
pension or the unwinding of legacy
share schemes or historic share
awards) that remain outstanding.
As set out in the Prospectus, the
Company has various legacy IPO
arrangements, some of which remain
subject to time vesting post-IPO.
Incentive awards granted prior to the
introduction of this policy will continue
to operate in line with the terms agreed
at grant, including the IPO Employee
Share Plan awards granted to the
Executive Directors that are outlined on
page 105.
Summary of decision-making process
In determining the Directors’
Remuneration Policy, the Committee
followed a robust process which
included discussions on the content
of the Policy at Remuneration
Committee meetings during the year.
The Committee considered the input
from management and independent
advisors, as well as considering views
of shareholders and proxy advisory
services.
Explanation of performance measures
Annual bonus performance measures
are selected annually to align with the
Group’s KPIs and strategic imperatives
and the interests of our shareholders
and other stakeholders. Financial
measures will normally influence most
of the bonus with any remainder based
on key strategic and/or personal
objectives designed to ensure
Executive Directors are incentivised
across a range of objectives. Target
performance is typically set in line
with the year’s business plan, with the
threshold to stretch targets set around
the plan, based on a sliding scale that
reflects relevant commercial factors.
Only modest rewards are available at
threshold performance levels, with
rewards at stretch requiring material
outperformance of the business plan.
Details of the specific measures used
for the annual bonus are set out in the
annual report on remuneration.
PSP performance measures will be
selected to provide a robust and
transparent basis on which to measure
the Group’s performance; link
remuneration outcomes to delivery of
the business strategy over the longer
term; and provide strong alignment
between senior management and
shareholders. The policy provides for
Committee discretion to alter the PSP
measures and weightings from year
to year. This is to ensure that it can
continue to measure performance
appropriately, if the Group’s strategic
ambitions evolve over the life of the
policy.
When setting performance targets for
the bonus and PSP, the Committee
will consider a number of different
factors. These may include the Group’s
business plans and strategy, external
forecasts and the wider economic
environment.
The Committee retains the discretion to
amend the bonus pay-out and the PSP
vesting level if any formulaic outcome
does not reflect its assessment of
overall business performance over the
relevant period.
Flexibility, discretion and judgement
The Remuneration Committee
operates the annual bonus, DBP and
PSP according to the rules of each
respective plan which, consistent with
market practice, include discretion in a
number of respects to the operation of
Group plc Annual Report and Accounts 2023 97
Governance Report
Directors’ Remuneration Policy
Continued
each plan. Discretions include but are
not limited to:
• Who participates in the plan,
the quantum of an award and/or
payment, and the timing of awards
and/or payments.
• Whether dividend equivalents will
apply to the awards.
• Determining the extent of vesting.
• Treatment of awards and/or
payments on a change of control or
restructuring of the Group.
• Whether an Executive Director or
senior manager is a good/bad leaver
for incentive plan purposes and if the
proportion of awards that vest do so
at the time of leaving or at the normal
vesting date(s).
• How and whether an award may be
adjusted in certain circumstances
(for example, for a rights issue, a
corporate restructuring or special
dividends).
• What the weighting, measures and
targets should be for the annual
bonus plan and PSP awards from year
to year.
• The ability, within the policy, to
adjust targets and/or set different
measures or weightings for the
applicable annual bonus plan and
PSP awards, if the Committee
determines that the original
conditions are no longer appropriate
or do not fulfil their initial purpose.
Such changes would be explained
in the subsequent Directors’
Remuneration Report and, if
appropriate, be discussed with our
major shareholders.
• The ability to override formulaic
outcomes in line with policy.
All assessments of performance are
ultimately subject to the Committee’s
judgement. Any discretion exercised,
and the rationale, will be disclosed in
the Annual Remuneration Report.
The Committee may make minor
amendments to the policy set out
above (for regulatory, exchange
control, tax or administrative purposes
or to take account of a change
in legislation) without obtaining
shareholder approval for that
amendment.
Stating maximum amounts for the
remuneration policy
The DRR regulations and related
investor guidance encourages
companies to disclose a cap within
which each element of the Directors’
Remuneration Policy will operate.
Where maximum amounts for elements
of remuneration have been set within
the Directors’ Remuneration Policy,
these will operate simply as caps and
are not indicative of any aspiration.
Travel and hospitality
While the Committee does not
consider it to form part of benefits
in the normal usage of that term, it
has been advised that corporate
hospitality (whether paid for by the
Company or another) and business
travel for Directors (and exceptionally
their families) may technically come
within the applicable rules and so the
Committee expressly reserves the right
for the Committee to authorise such
activities within its agreed policies.
Differences between the policy
on remuneration for Directors and
remuneration of other employees
While the appropriate benchmarks
vary by role, the Company seeks to
apply the philosophy behind this
policy across the Company as a whole.
Where ProCook Group’s pay policy for
Directors differs from its pay policies
for groups of employees, this reflects
the appropriate market rate position
and/or typical practice for the relevant
roles. The Company considers pay
levels, bonus opportunity and share
awards applied across the Group as
a whole when setting the Executive
Directors’ Remuneration Policy.
Recruitment Remuneration Policy
The Company’s Recruitment Remuneration Policy aims to give the Committee sufficient flexibility to secure the
appointment and promotion of high-calibre Executives to strengthen the management team and secure the skill sets to
deliver our strategic aims.
In terms of the principles for setting a package for a new Executive
Director, the starting point for the Committee will be to apply
the general Policy for Executive Directors as set out above and
structure a package in accordance with that policy. Any caps
contained within the policy for fixed pay do not apply to new
recruits, although the Committee would not envisage exceeding
these caps in practice.
The Annual Bonus Plan, DBP and PSP will operate (including
the maximum award levels) as detailed in the general Policy in
relation to any newly appointed Executive Director. For an internal
appointment, any variable pay element awarded in respect of the
prior role may either continue on its original terms or be adjusted to
reflect the new appointment as appropriate.
For external and internal appointments, the Committee may agree
that the Company will meet certain relocation expenses as it
considers appropriate.
For external candidates, it may be necessary to make additional
awards in connection with the recruitment to buy out awards
forfeited by the individual on leaving a previous employer.
For the avoidance of doubt, buy-out awards are not subject to a
formal cap. Any recruitment-related awards which are not buy-outs
will be subject to the limits for Annual Bonus Plan and PSP as stated in
the general policy. Details of any recruitment-related awards will be
appropriately disclosed.
For any buy-outs the Company will not pay more than is, in the view
of the Committee, necessary and will in all cases seek, in the first
instance, to deliver any such awards under the terms of the existing
Annual Bonus Plan, DBP or PSP. It may, however, be necessary
in some cases to make buy-out awards on terms that are more
bespoke than the existing Annual Bonus Plan, DBP or PSP.
All buyouts, whether under the Annual Bonus Plan, DBP, PSP or
otherwise, will take due account of the service obligations and
performance requirements for any remuneration relinquished by the
individual when leaving a previous employer. The Committee will seek
to the extent possible to provide any buy-out award on a broadly
like-for-like basis.
Group plc Annual Report and Accounts 202398
A new Chair/Non-Executive Director would be recruited on the terms explained above in respect of the main policy for
suchDirectors.
Service contracts
Executive Directors
The Committee’s policy is that each Executive Director’s service agreement should be of indefinite duration, subject to
termination upon no more than six months’ notice by either party. The service agreements of the Executive Directors comply
with that policy. Contracts contain provisions allowing the Company to make payments in lieu of notice (albeit not including
bonus or benefits) but do not contain change of control provisions.
The Committee reserves flexibility to alter these principles, if necessary, to secure the recruitment of an appropriate
candidate and, if appropriate, introduce a longer initial notice period (of up to two years) reducing over time.
The date of each Executive Director’s contract is:
• Daniel O’Neill 19 October 2021
• Dan Walden 19 October 2021
Chair/Non-executive Directors
The Chair and each Non-Executive Director is engaged for an initial period of three years. These appointments can be
renewed following the initial three-year term. These engagements can be terminated by either party on three months’ notice.
Neither the Chair nor any Non-Executive Directors can participate in the Company’s incentive plans, are not entitled to any
pension benefits and are not entitled to any payment in compensation for early termination of their appointment beyond the
three months’ notice referred to above.
Name
Date of
appointment Term
Greg Hodder 29 October 2021 3 years
David Stead 29 October 2021 3 years
Luke Kingsnorth 29 October 2021 3 years
The Directors’ service agreements and letters of appointment are available for shareholders to view from the Group
Company Secretary on request.
Termination/change of control policy summary
It is appropriate for the Committee to consider treatments on a termination having regard to all of the relevant facts and
circumstances available at that time. This policy applies both to any negotiations linked to notice periods on a termination
and any treatments that the Committee may choose to apply under the discretions available to it under the terms of the
Annual Bonus Plan, DBP and PSP.
The Company is entitled to terminate the Executive Directors’ employment by payment of a cash sum in lieu of notice equal
to salary during what would otherwise have been the notice period. A payment in lieu of notice can, at the Company’s
discretion, be paid as a lump sum or in equal monthly instalments over the notice period. There is a mechanism in the service
agreement to reduce the instalments where the Executive Director commences alternative employment during the notice
period. The Company may also terminate the Executive Directors’ employment with immediate effect and with no liability
to make any further payments in certain prescribed circumstances (e.g., in the case of a serious or repeated breach of the
Executive Directors’ obligations).
Group plc Annual Report and Accounts 2023 99
Governance Report
Directors’ Remuneration Policy
Continued
The potential treatments for the various incentive arrangements if there is a termination of employment or a change of
control before the awards have vested are summarised in the table below:
Incentives
If a leaver is deemed to be a ‘good leaver’; for example,
leaving through injury, ill-health, disability, redundancy, sale
of business or otherwise at the discretion of the Committee
If a leaver is not
a ‘good leaver’ Change in control
Annual bonus Bonuses remain payable on the normal payment date and will be
determined on such basis as the Committee may decide, which can
include pro-rating for time. Bonuses are not subject to deferral under
the DBP.
Annual bonus not
generally paid.
Payment is accelerated to
the date of the Change of
Control. Committee has
discretion to determine the
extent to which performance
targets are achieved as at the
Change of Control, or can
waive performance targets.
Bonuses are pro-rated for
time unless the Committee
determines otherwise.
Bonuses are not subject to
deferral under the DBP.
DBP Upon death, awards become exercisable on the date of death.
Awards are not normally subject to pro-rating unless the Committee
determines otherwise.
For other ‘good leavers’, awards become exercisable on the vesting
date, unless the Committee exercises discretion to allow them to be
exercisable from the cessation date. Awards are not normally subject
to pro-rating unless the Committee determines otherwise.
All awards will
normally lapse.
Awards vest in full.
PSP Upon death, awards become exercisable on the date of death. If the
date of death is during the vesting period, the Committee would need
to determine the extent to which the performance targets are achieved
on such modified basis as it may consider appropriate and the Awards
would be subject to pro-rating, unless the Committee determines
otherwise. If the date of death is during the holding period, the
Awards are not normally subject to pro-rating, unless the Committee
determines otherwise.
For other ‘good leavers’ during the vesting period, awards become
exercisable on the vesting date (subject to performance), unless
the Committee exercises discretion to allow them to be exercisable
from the cessation date (in which case the Committee would need to
determine the extent to which the performance targets are achieved
on such modified basis as it may consider appropriate). The Awards
would be subject to pro-rating unless the Committee determines
otherwise.
For other ‘good leavers’ during the holding period, awards become
exercisable on the cessation date. The Awards are not normally subject
to pro-rating unless the Committee determines otherwise.
All awards will
normally lapse,
unless the
Committee
determines
otherwise, in
which case the
Committee has
broad discretion
to determine the
extent to which
the Award can be
exercised and the
timing of exercise.
Awards become exercisable
on the Change of Control.
If the Change of Control is
during the vesting period, the
Committee would need to
determine the extent to which
the performance targets are
achieved on such modified
basis as it may consider
appropriate and the Awards
would be subject to pro-
rating, unless the Committee
determines otherwise. If
the Change of Control is
during the holding period,
the Awards are not normally
subject to pro-rating, unless
the Committee determines
otherwise.
All-employee
share plans
As per HMRC regulations. As per HMRC
regulations.
As per HMRC regulations.
The Company has the power to enter into settlement agreements with Directors and to pay compensation to settle potential
legal claims. In addition, and consistent with market practice, in the event of the termination of an Executive Director, the
Company may contribute towards that individual’s legal fees and fees for outplacement services as part of a negotiated
settlement. Any such fees will be disclosed as part of the detail of termination arrangements. For the avoidance of doubt,
thepolicy does not include an eplicit cap on the cost of termination payments.
External appointments
The Company’s policy is to permit an Executive Director to serve as a Non-Executive Director elsewhere when this does not
conflict with the individual’s duties to the Company, and where an Executive Director takes such a role, they will be entitled to
retain any fees which they earn from that appointment (unless the Committee determines otherwise).
Statement of consideration of employment conditions elsewhere in the Group
Pay and employment conditions generally in the Group are considered when setting Executive Directors’ remuneration. The
Committee receives regular updates on overall pay and conditions in the Group, including (but not limited to) changes in
base pay and any staff bonus pools in operation.
Group plc Annual Report and Accounts 2023100
Although the Committee has not, to date, formally consulted with employees on matters of remuneration policy, the
Committee will ensure there is appropriate liaison with the People and ESG Director to discuss any remuneration matters
which should be considered as part of its annual cycle. Employee engagement scores and other internal surveys will be
considered as appropriate.
Statement of consideration of shareholder views
When determining Executives’ remuneration, the Committee considers views of shareholders and best practice guidelines
issued by institutional shareholder bodies. The Committee is always open to feedback from shareholders on remuneration
policy and arrangements, and commits to undergoing shareholder consultation in advance of any significant changes to
remuneration policy.
The Committee will continue to monitor trends and developments in corporate governance and market practice to ensure
that the structure of the Executive remuneration remains appropriate.
Illustrations of application of remuneration policy (£000)
100%
Minimum
On target
Maximum
Maximum
with growth
Minimum
On target
Maximum
Maximum
with growth
59% 35% 30%
£320
28%
33% 28%
£545
14%
33% 28%
14%
£920
£1,070
100% 58% 34% 30%
£269
28%
33% 28%
£464
14%
33% 28%
14%
£789
£919
CFOCEO
Share price growth
Long-term incentiveAnnual bonusFixed
The charts above aim to show how the remuneration policy for Executive Directors will be applied in FY24 using the
assumptions in the table below.
Minimum • Consists of base salary, benefits and pension.
• Base salary is the salary to be paid with effect from 3 April 2023.
• Estimated value of a full year’s benefits.
• Pension measured as the cash allowance in lieu of Company contributions at 3% of salary.
£000 Base salary Benefits Pension Total fixed
Daniel O’Neill - CEO 300 11 9 320
Dan Walden - CFO 260 1 8 269
Target • Annual bonus: consists of an assumed payment of 50% of maximum opportunity.
• Long-term incentives: consists of the threshold level of vesting (25% vesting) under the PSP.
Maximum Based on the maximum remuneration receivable (excluding share price appreciation and dividends):
• Annual bonus: consists of maximum bonus of 100% of base salary.
• Long-term incentives: consists of the maximum level of vesting under the PSP of 100% of base salary.
Maximum with
Share Price Growth
As per the maximum but with a 50% share price growth assumption for the PSP awards
Group plc Annual Report and Accounts 2023 101
Governance Report
Annual Report on Remuneration
The Committee
The Remuneration Committee was established with effect from Admission. It is chaired by Luke Kingsnorth, and its other
members are Greg Hodder and David Stead.
The Committee’s principal responsibilities are to:
• Recommend to the Board the over-arching principles, parameters and governance framework of the Group’s
remuneration policy.
• Determine, within that framework, individual remuneration and benefits packages of each of the Chair, Executive Directors
and senior management; and
• Review the design of all share incentive plans for approval by the Board and, where required, shareholders.
The Chief Executive Officer is invited to attend meetings of the Committee, except when his own remuneration is being
discussed, and the Chief Financial Officer and other Executives attend meetings as required. Greg Hodder takes no part in
any discussions relating to his own remuneration.
The Committee met three times during the year, with all members of the Committee present at these meetings.
The Committee has formal terms of reference which can be viewed on the Corporate Governance section of the Company’s
website www.procookgroup.co.uk.
Key activities during the year
During FY23, the Committee carried out the following activities:
• Agreeing the performance against the targets and pay-out for the FY22 annual bonus awards;
• Finalising the Directors’ Remuneration Policy for shareholder approval;
• Agreeing Executive Director and senior management base salaries from 1 April 2022;
• Setting the performance targets for the FY23 annual bonus;
• Agreeing the award levels and appropriate targets for the 2022 PSP awards;
• Overseeing the operation of the Group’s Save as You Earn scheme; and
• Reviewing the Committee terms of reference.
External adviser
FIT Remuneration Consultants LLP (“FIT”), signatories to the Remuneration Consultants Group’s Code of Conduct, were
appointed by the Committee following a competitive tender process and provide advice to the Committee on all matters
relating to remuneration, including best practice. FIT provided no other services to the Group and, accordingly, the
Committee was satisfied that the advice provided by FIT was objective and independent. FIT’s fees in respect of FY23 were
£19,253 (excluding VAT). FIT’s fees were charged on the basis of the firm’s standard terms of business for advice provided.
Single total figure table (audited)
The remuneration for the Chair, Executive and Non-Executive Directors of the Company who performed qualifying services
during the financial year is detailed below. The Chair and Non-Executive Directors received no remuneration other than their
annual fee.
For the year ended 2 April 2023:
£000
Salary/
fees
1
Taxable
benefits
2
Pension
Bonus Long-term
incentives
Total fixed
remuneration
Total variable
remuneration
Total
remuneration
Daniel O’Neill 219 11 7 — — 237 — 237
Steve Sanders
3
188 — 5 — — 194 — 194
Dan Walden 238 — 7 — — 245 — 245
Greg Hodder 108 — — — — 108 — 108
David Stead 50 — — — — 50 — 50
Gillian Davies
4
37 — — — — 37 — 37
Luke Kingsnorth 43 — — — — 43 — 43
Total 883 11 19 — — 914 — 914
Group plc Annual Report and Accounts 2023102
For the year ended 3 April 2022:
£000
Salary/
fees
Taxable
benefits
Pension
Bonus Long-term
incentives
Total fixed
remuneration
Total variable
remuneration
Total
remuneration
Daniel O’Neill 124 5 1 — — 129 — 129
Steve Sanders
3
170 — 1 — — 171 — 171
Dan Walden
5
184 — 1 — 250
7
185 250 435
Greg Hodder
6
52 — — — — 52 — 52
David Stead
6
24 — — — — 24 — 24
Gillian Davies
4
22 — — — — 22 — 22
Luke Kingsnorth
6
19 — — — — 19 — 19
Total 595 5 3 — 250 602 250 852
1
Salary/ Fees were subject to a temporary reduction between October 2022 and April 2023 as outlined in the Chair’s Remuneration Committee
Report.
2
Taxable benefits comprise life assurance and car allowance.
3
Stepped-down from the Board on 14 December 2022.
4
Appointed 29 October 2021 and stepped down from the Board on 14 December 2022.
5
Appointed 18 May 2021.
6
Appointed 29 October 2021.
7
The CFO Free Share ESP Award as outlined in the IPO Prospectus.
Further information on the FY23 annual bonus (audited)
In FY23, the annual bonus metrics related to on performance against financial targets for 70% of the award (revenue,
underlying profit before tax and free cash flow) with 30% of the award being based on other strategic targets (colleague
engagement and ESG). The threshold for pay-out of any award was set at a minimum underlying profit before tax of £2.5m.
Specifically, the targets were as follows:
£m Threshold Target Maximum Actual
Pay-out
(% of max)
Revenue (20% of award) £75.6m £84.0m £92.4m £62.3m 0%
Underlying profit before tax (30% of award) £9.9m £11.0m £12.1m (£0.2m) 0%
Free cash flow (20% of award) £10.3m £11.4m £12.6m (£0.1m) 0%
Colleague engagement score (15% of award) 70% 75% 80% 66% 0%
ESG targets
1
(15% of award) 75% attained 100% attained 125% attained 82.5% 0%
1
The ESG targets included completing a Net Zero Gap Analysis, determining Net Zero Roadmap and progression against it, “Excellent” BREEAM
classification of the new Distribution Centre and Headquarters building and reduction in emissions intensity (measured as emissions / revenue).
Share awards vesting in respect of FY23
There are no awards due to vest based on performance to 2 April 2023.
Group plc Annual Report and Accounts 2023 103
Governance Report
Annual Report on Remuneration
Continued
Statement of Directors’ shareholding and share interests (audited)
The table below details for each Director, the total number of Directors’ interests in shares as at 2 April 2023:
Director
Beneficially
owned
3 April 2022
Beneficially
owned
2 April 2023
1
Vested but
unexercised
awards
Unvested
DBP
Unvested
PSP
2
Unvested
ESP
3
Shareholding
Guideline (%
of salary)
4
Shareholding
Guideline
met?
4
Daniel O’Neill 37,736,902 38,736,902 — — 917,796 — 200% Yes
Steve Sanders 791,735 791,735 — — — 1,064,530 200% No
Dan Walden — 50,000 — — 937,244 862,068 200% No
Greg Hodder 24,137 39,137 — — — — — n/a
David Stead 34,482 34,482 — — — — — n/a
Gillian Davies 17,241 17,241 — — — — — n/a
Luke Kingsnorth 10,344 10,344 — — — — — n/a
1
The beneficial shareholdings set out above include those held by Directors and their respective connected persons as at 2 April 2023 or at the date of
stepping down from the Board if earlier.
2
Performance-based share awards granted as nil cost options.
3
Options subject to continued service.
4
Shareholding guidelines for Executive Directors are 200% of salary. The value of the shares has been calculated using the closing ProCook Group plc
share price as at 2 April 2023, which was 31p. Executive Directors will be required to retain all shares that vest, net of any tax liability under the DBP and
PSP until the guideline is met.
PSP awards granted in FY23
The following awards were granted as nil-cost options under the PSP in FY23:
Director
Date of
grant
Basis of
award
(% salary) Share price
1
Number of
shares
Face value
of award Exercise period
Daniel O’Neill 8 August 2022 100% 42.2p 710,900 £300,000 August 2027 to August 2032
Steve Sanders 8 August 2022 100% 42.2p 473,933 £200,000 August 2027 to August 2032
Dan Walden 8 August 2022 100% 42.2p 592,417 £250,000 August 2027 to August 2032
1
Based on the share price of 42.2p being the closing share price on the working day prior to award.
The performance conditions, applying to the awards made in August 2022 relate to earnings per share (EPS). More
specifically:
Adjusted EPS for FY25 financial year Portion of award vesting
Above 7.3p 100%
Between 6p and 7.3p Pro rata on straight-line between 25% and 100%
6p 25%
Below 6p
0%
DBP awards granted in FY23
No DBP awards were granted during the year.
Group plc Annual Report and Accounts 2023104
Outstanding share plan awards
Details of all outstanding share awards made to Executive Directors are set out below:
Executive
Award
type
Exercise
price (p)
Grant
date
Interest
at 3 April
2022
Awards
granted
in the
year
Awards
lapsed in
the year
Awards
exercised
in the year
Interest
at 2 April
2023
Exercise
period Notes
Daniel O’Neill PSP 0 12/11/21 206,896 — — — 206,896 Nov 26 – Nov 31 1
PSP 0 08/08/22 — 710,900 — — 710,900 Aug 27 – Aug 32 2
Steve Sanders PSP 0 12/11/21 137,931 — 137,931 — — Nov 26 – Nov 31 1
PSP 0 08/08/22 — 473,933 473,933 — — Aug 27 – Aug 32 2
IPO ESP 0 12/11/21 1,064,530 — — — 1,064,530 Nov 23 – Nov 31 3
Dan Walden PSP 0 12/11/21 344,827 — — — 344,827 Nov 26 – Nov 31 1
PSP 0 08/08/22 — 592,417 — — 592,417 Aug 27 – Aug 32 2
IPO ESP 0 12/11/21 172,413 — — — 172,413 Nov 24 – Nov 31 3
IPO ESP 145 12/11/21 689,655 — — — 689,655 Nov 24 – Nov 31 3
Notes:
1
See “PSP Awards Granted in FY22” section in the 2022 Directors’ Remuneration Report.
2
See “PSP Awards Granted in FY23” section above.
3
See “IPO ESP Awards Granted in FY22” section in the 2022 Directors’ Remuneration Report.
During the year ended 2 April 2023, the highest mid-market price of the Company’s shares was 130p and the lowest mid-
market price was 25.6p. At 2 April 2023 the share price was 31p.
The aggregate gains by all Directors during FY23 was £nil.
Payments to past directors and in respect of loss of office (audited)
As announced on 26 September 2022, Steve Sanders stepped down from the Board on 14 December 2022. He remained
in his role as COO in the Leadership Team receiving a pro-rata salary of £180,000, benefits and pension up to the end
of his notice period on 31 March 2023. Since that date, he moved to a part time role on a reduced salary, to facilitate an
orderly transition of duties until 27 June 2023. He did not receive an award under the FY23 annual bonus. Upon cessation of
employment his outstanding PSP awards lapsed. The IPO ESP awards, that were outlined in the IPO Prospectus, will vest at
their original vesting date of November 2023 in accordance with their terms.
Performance graph and CEO remuneration table (unaudited)
The following graph shows the Total Shareholder Return (“TSR”) performance of an investment of £100 in ProCook Group
plc’s shares from its listing in November 2021 to 2 April 2023, compared with a £100 investment in the FTSE SmallCap Index
over the same period. The FTSE SmallCap Index was chosen as a comparator because it represents a broad equity market
index of similar-sized companies.
Total Shareholder Return Index
ProCook FTSE SmallCap
10 November
2021
3 April
2022
2 April
2023
0
20
40
60
80
100
120
Group plc Annual Report and Accounts 2023 105
Governance Report
Annual Report on Remuneration
Continued
The table below details certain elements of the CEO’s remuneration over the same period as presented in the TSR
Index graph.
Year CEO
Single figure of total
remuneration
(£000)
Annual Bonus pay-out
against maximum %
Long-term incentive vesting
rates against maximum
opportunity %
FY23 Daniel O’Neill 237 0% n/a
FY22 Daniel O’Neill 129 0% n/a
Annual change in Directors’ remuneration compared with other employees
As we do not yet have data for two full years since listing, it is not possible to provide meaningful year-on-year comparisons.
Full disclosure of year-on-year movements will be provided in next year’s remuneration report.
CEO to employee pay ratio
The table below shows the CEO to employee pay ratio.
Year Method 25th percentile pay ratio Median pay ratio 75th percentile pay ratio
FY23 Option A 11.5 : 1 10.8 : 1 8.3 : 1
FY22 Option A 6.2 : 1 5.7 : 1 4.6 : 1
Notes to the CEO to employee pay ratio:
1
Option A which takes into consideration the full-time equivalent basis of all employees and provides a representative result of employee pay
conditions across the Company.
2
The ratios shown are representative of the FTE 25th percentile, median and 75th percentile pay for UK employees within the Group during FY23. Full
year pay data for the FY23 financial year has been used to calculate the ratios.
3
The pay for part-time employees has been grossed-up to one FTE employee.
4
The Committee has reviewed the employee data and believes the median pay ratio to be consistent with the pay, reward and progression policies for
the Company’s UK employees over the period.
5
The CEO’s pay is based on the single figure of remuneration. Because a large portion of the CEO’s pay is variable, the pay ratio is heavily dependent
on the outcomes of variable pay plans and, in the case of long-term share-based awards, share price movements. As the CEO’s single figure of
remuneration for FY22 represented the part year period from IPO, the ratio has increased for the full year in FY23.
The total pay and benefits and the salary component of total pay and benefits for the employee at each of the 25th
percentile, the median and the 75th percentile are shown below:
Year
Salary £000 Total pay and benefits £000
25th percentile Median 75th percentile 25th percentile Median 75th percentile
FY23 21 22 27 21 22 29
Relative importance of spend on pay (unaudited)
The table below details the spend on total employee pay in FY23 as detailed in Note 7 of the Financial Statements, compared
with distributions to shareholders by way of dividend, share buybacks or any other significant distributions or payments.
£m
52 weeks ended
2 April 2023
52 weeks ended
3 April 2022
Total gross employee pay 15.1 13.7
Dividends/share buybacks 0.3 1.9
Group plc Annual Report and Accounts 2023106
Statement of shareholding voting
The following table shows the results of the binding Remuneration Policy vote and the advisory Directors’ Remuneration
Report vote at the 20 September 2022 AGM.
(Binding Vote – 20 September 2022)
Approval of the Directors’ Remuneration Policy
(Advisory Vote – 20 September 2022)
Annual Report on Remuneration
Total number of votes % of votes cast Total number of votes % of votes cast
For (including
discretionary) 96,065,973 99.986% 96,065,973 99.986%
Against 13,567 0.040% 13,567 0.040%
Votes withheld 3,564 — 3,564 —
Implementation of policy for FY24 (unaudited information)
Base salary
Base salaries for FY24 are as follows: £300,000 for Daniel O’Neill (FY22: £300,000) and £260,000 for Dan Walden
F22:20,000.
Pension
Maximum contribution rates for Executive Directors are 3% of salary. This rate is aligned with the general workforce rate.
Benefits
Details of the benefits received by Executive Directors are set out in the Single Total Figure Table on page 101. There is no
intention to introduce additional benefits in FY24.
Annual bonus
The annual bonus opportunity for FY24 will be structured in a broadly similar manner to FY23. The maximum bonus will be
100% of salary and will be payable based on 30% underlying profit before tax performance, 30% revenue, 30% free cash
flow and 10% colleague engagement score.
These targets are set in light of internal and external forecasts and will require significant outperformance to generate higher
levels of pay-out.
Given the competitive nature of the Company’s sector, the specific performance targets for FY24 are considered to be
commercially sensitive and, accordingly, are not disclosed at this time, although the targets will be disclosed in next year’s
report in relation to the bonus outturn.
Long-term incentives
Awards are expected to be made under the PSP in 2023 to the Executive Directors. The structure of the awards is being
finalised and details will be included in the RNS announcing the awards at the time of their grant.
Chair and Non-Executive Directors’ fees
The fees of the Chair and Non-Executive Directors for FY24 will remain in line with the reduced fees which were implemented
from October 2022 onwards as outlined in the Chair’s Remuneration Committee Report before returning to their previous
levels in FY25 onwards.
Greg Hodder will therefore receive a reduced fee of £95,000 as Chair for FY24.
The Non-Executive Directors each receive a reduced fee for FY24 of £35,000 with an additional fee of £5,000 for each of
the Chair of the Audit and Risk Committee and Chair of the Remuneration Committee and an additional fee of £5,000 for the
Senior Independent Director.
Group plc Annual Report and Accounts 2023 107
Governance Report
Directors’ Report
This report contains the additional information the Directors are reuired to include in the AnnualReport and Accounts in
accordance with the Companies Act 2006 and the Listing Rules.
Disclosures required under Listing Rule 9.8.4R
The information required to be disclosed under Listing Rule 9.8.4R, where applicable to the Company, can be found in this
Annual Report and Accounts at the references provided below:
Listing Rule Requirement Annual Report Location
Interest capitalised Not applicable
Publication of unaudited financial information Not applicable
Details of long-term incentive schemes Pages 96 and 104 to 105
Waiver of emoluments by a Director Page 92
Waiver of future emoluments by a Director Page 107
Non-pre-emptive issues of equity for cash Not applicable
Non-pre-emptive issues of equity for cash by a major subsidiary Not applicable
Parent participation in a placing by a listed subsidiary Not applicable
Contracts of significance Not applicable
Provision of services by a controlling shareholder Page 111
Dividend waivers Page 57
Agreements with controlling shareholders Page 112
Results and dividends
The Company’s underlying loss after tax for the year ended
2 April 2023 was £(0.1)m; details are shown in the
Consolidated Income Statement on page 122. The Directors
are not recommending a final dividend for shareholder
approval at the 2023 Annual General Meeting.
Directors
The Directors who held office during the year and up to
the date of the signing of this report (unless otherwise
indicated) are:
• Greg Hodder
• Daniel O’Neill
• Steve Sanders resigned1December 2022
• Dan Walden
• David Stead
• Gillian Davies resigned1December 2022
• Luke Kingsnorth
Biographies for the current Directors appear on pages
78 to 79.
Information on the Directors’ remuneration, employee share
schemes and service contracts are set out in the Directors’
Remuneration Report on pages 94 to 107.
Appointment and replacement of Directors
The rules about the appointment and replacement of
Directors are contained in the Company’s articles of
association (‘Articles’). They provide that the Directors may
be appointed by ordinary resolution of the shareholders or
by the Board. Directors appointed by the Board may only
hold office until the next AGM of the Company and then shall
be eligible for election. The Company may remove a Director
by ordinary resolution where special notice has been given
and the necessary statutory procedures are complied with.
In line with best practice corporate governance, all Directors
will seek re-election at the 2023 AGM.
Re-election
In accordance with the Code and Articles, all Directors
are subject to annual re-election by the shareholders at
the AGM.
Time commitment
Each Director’s other commitments are disclosed and, in the
case of significant appointments, approved by the Board
in advance. The Board reviews a schedule of Directors’
interests at each Board meeting. The Board is satisfied that
the other commitments of the Chair and the independent
NEDs do not prevent them from devoting sufficient time to
the Company. The Executive Directors work solely for the
Group and do not hold any significant external directorships.
Access to advice
All Directors have access to the advice and services of the
Company Secretary, who is responsible for advising the
Board on corporate governance matters. The Directors
are able to take independent, professional advice to assist
them, if necessary, at the Company’s expense.
Powers of Directors
The general powers of the Directors are set out in article
128 of the Company’s Articles. This article provides that the
business of the Company shall be managed by the Directors,
who may exercise all the powers of the Company, subject
to any limitations imposed by applicable legislation, the
Articles and any directions given by special resolution of the
shareholders of the Company.
Group plc Annual Report and Accounts 2023108
Compensation for loss of office
The Company does not have arrangements with any Director
that would provide compensation for loss of office or
employment resulting from a takeover.
Future developments
In accordance with s414C(11) of the Companies Act 2006,
the Company has disclosed information about future
developments within the Strategic Report on pages 2 to 73.
Additionally, this Directors’ Report, Strategic Report and
the financial statements contain certain forward-looking
statements with respect to the financial condition,
performance and business of the Group. All forward-looking
statements involve risk and uncertainty because they relate
to events and circumstances that may or may not occur in
the future. There are a number of factors that could cause
actual outcomes to differ from those expressed or implied
by any forward-looking statements. Nothing in this Directors’
Report and Strategic Report or in these financial statements
should be construed as a profit forecast.
Corporate governance
A report on corporate governance and the Company’s
compliance with the UK Corporate Governance Code is set
out on page 75 and forms part of this report by reference.
Post balance sheet events
On 4 May 2023 the Group executed its agreement with
HSBC to amend certain terms of its existing Revolving Credit
Facility agreement. The amendment has reduced the Fixed
Charge Cover covenant from at least 1.70x to 1.25x for the
FY23 Q4 and FY24 Q1 test dates and 1.40x thereafter.
Research and development
The Directors consider that investment in research and
development (‘R&D’) is critical to enable the Company to
maintain its competitive advantage and continue to grow
its market share. The Group employs specialist resources in
product design and technology functions at its head office
in Gloucester, who work closely with external specialists and
overseas factories. R&D expenditure for the year was £nil
(FY22: £0.6m).
Asset values
Property, plant and equipment is disclosed in Note 15 of the
Consolidated Financial Statements on pages 122 to 155.
The Directors do not believe there is any material difference
between the carrying value and market value.
Financial instruments
An analysis of the Company’s financial instruments, risk
management objectives and its exposure to credit and
liquidity risk are disclosed in Note 25 of the Consolidated
Financial Statements.
Global operations
The Group’s Executive head office, accounting, domestic
sales and support functions are based in the UK. The Group
has 58 stores nationwide.
Political donations
No political donations were made and no political
expenditure was incurred during the year.
Charitable donations
Charitable donations of £59k were made during the year.
Stakeholder engagement
Information relating to how the Directors have engaged
with employees and other stakeholders, and had regard to
the Company’s relationships with suppliers, communities
and customers when taking key decisions, are set out in the
Strategic Report on pages 22 to 27. Our s172(1) Companies
Act 2006 statement can be found on page 22.
Colleague involvement
We are committed to colleague involvement in the activities
and development of our business. We keep our colleagues
informed through regular newsletters and town hall events,
and we seek their feedback through surveys and our
Colleague Advisory Panel.
Read more:
Engaging with our stakeholders – pages 22 to 27.
Sustainability: Our People – pages 31 to 35.
Colleague advisory panel - page 77.
Share incentive schemes in which employees participate are
described in the Annual Report on Remuneration on page 96
and in the Consolidated Financial Statements. The company
operates an all-employee SAYE scheme, and also issued
shares to qualifying colleagues on IPO.
Equal opportunities
The Group is committed to providing equal opportunities
for all existing and potential colleagues, and has established
policies and procedures around diversity, inclusivity and
equality.
Read more:
Diversity, equality and inclusion policy: see www.procookgroup.co.uk.
Non-financial information and sustainability statement – page 51.
Sustainability: Our people – pages 31 to 35.
Employees with disabilities
The Group is committed to providing equal opportunities for
all, including existing and potential colleagues with health
conditions, visible and non-visible, who meet the criteria
to perform the duties required of a role. Where required,
ProCook adjusts working environments or provides other
flexible means of working to support colleagues.
Group plc Annual Report and Accounts 2023 109
Governance Report
Directors’ Report
Continued
Greenhouse gas emissions
The information set out below is that required by the Companies Act 2006 (Strategic Report and Directors’ Report)
Regulations 2013 and Companies (Directors’ Report and Limited Liability Partnerships (Energy and Carbon Report)
Regulations 2018.
Greenhouse Gas emissions (tCO
2
)
FY19 FY20 FY21 FY22 FY23
Scope 1 - Direct emissions from gas and fuel 564.3 575.4 177.7 90.6 70.2
Scope 2 - Indirect emissions from electricity 432.6 440.2 252 357.1 299.7
Total Scope 1 and 2 GHG emissions 996.9 1,015.6 429.7 447.7 369.9
Revenue £m 27.8 38.9 53.4 69.2 62.3
CO
2
emissions intensity (tCO
2
/ £1m revenue) 35.9 26.1 8.0 6.5 5.9
The reduction in direct emissions (Scope 1) in FY23 is due to the Group’s continued focus on energy reduction initiatives and
transition towards green energy supply. Indirect emissions from electricity consumption decreased in FY23 as we began
the transition towards the use of green energy across our property estate. The lower CO
2
emissions intensity highlights the
improved emissions efficiency we are achieving as sales volumes grow.
Streamlined Energy and Carbon Reporting (SECR)
Energy (Megawatt hours)
1
FY19 FY20 FY21 FY22 FY23
Electricity 1.7 1.7 1.1 1.7 1.5
Gas 0.3 0.3 0.1 0.1 0.0
Fuel 2.2 2.2 0.7 0.3 0.3
Total 4.1 4.1 1.8 2.1 1.8
Consumption of energy decreased -14.3% to 1.8 Megawatt hours during FY23 driven by the above factors and our continued
progress with our green energy initiatives across the business.
1
The analysis presented above reflects the Group’s operations in the UK. Operations in the EU are through a 3rd party provider. The location-based
methodology has been adopted by the Group.
Directors’ interests and share options
During the year ended 2 April 2023, no Director had an interest in any significant third-party contract between the Company
or any of its subsidiaries. Directors’ shareholdings are disclosed in the Annual Report on Remuneration on pages 102 to 107.
Details of Directors’ share options are set out in Note 27 of the Consolidated Financial Statements.
Directors’ conflicts of interest
In accordance with the Companies Act 2006 and the Articles, the Company has arrangements in place to consider and,
where appropriate, authorise any Directors’ direct or indirect interests which may conflict with those of the Company.
Authorisation is only effective where the matter is put to a vote, excluding the Director who is subject to the conflict
authorisation. If a Director becomes aware that they or a connected party have an interest in an existing or proposed
transaction with the Company, they should notify the Company Secretary as soon as possible. Directors have a continuing
obligation to update any changes to potential conflicts and the Board formally reviews any such conflicts periodically. A
register of conflicts or potential conflicts is maintained by the Company Secretary and is available to all Directors.
Directors’ liability and indemnity insurance
The Company maintains Directors’ and officers’ liability insurance, which gives appropriate cover for legal action brought
against its Directors. In addition, third-party qualifying indemnity provisions (as defined in s234 of the Act) for its Directors
and Officers were in force during the year ended 2 April 2023 and remain in force. There were no qualifying pension scheme
indemnity provisions.
Articles of Association
A copy of the Articles of Association can be obtained from the Company’s registered office and is also available on the
Company’s website and the Companies House website. The Articles may only be amended by special resolution of the
shareholders.
Group plc Annual Report and Accounts 2023110
Share capital and waiver of pre-emption rights
The Company has one class of share in issue. The rights attached to each share are identical and each share carries equal
rights to dividends, return of capital on the winding up of the Company and one vote at general meetings of the Company.
There are no securities carrying special rights. There are no restrictions on the transfer of shares in the Company (other than
following a service of notice under s793 of the Act) and there are no restrictions on any voting rights or deadlines, other than
those prescribed by law.
Pursuant to the Placing Agreement, except pursuant to certain customary exceptions, Daniel O’Neill, Sarah O’Neill, Michael
O’Neill, and Daniel and Sarah O’Neill as trustees of the O’Neill 2021 Discretionary Settlement have agreed they will not (and
will use their best endeavours to procure that their connected persons do not) sell or otherwise dispose of their shares in the
Company without the prior written consent of the Company’s sponsor, Peel Hunt, for 365 days from the date of Admission
on 10 November 2021, and to abide by orderly marketing restrictions for a further 365 days thereafter. Further details of the
rights and obligations attached to the Company’s shares are set out in the Company’s Articles.
As at 2 April 2023, the Company had 108,956,624 fully paid ordinary shares of 1p each in issue which are traded on the London
Stock Exchange. Details of the share capital at 2 April 2023 are disclosed on page 151.
Authority for the Company to purchase its own shares
In line with the approval granted in the 2022 AGM, a new resolution will be proposed at the 2023 AGM that the Company be
authorised to purchase up to approximately 10% of its ordinary shares at the Directors’ discretion. If the resolution is passed,
the authority will lapse at the conclusion of the 2024 AGM or, if earlier, 15 months from the date of the resolution being
passed.
Substantial shareholdings
At 2 April 2023 the Company had been notified of the following disclosable interests of 3% or more in the Company’s
ordinary share capital:
Shareholder
As at 2 April 2023
No. of
shares held
% voting
rights
Michael O'Neill 36,589,016 33.28
Daniel O'Neill 16,538,725 15.18
Sarah O'Neill 14,798,785 13.58
Fackelmann GmbH + Co. KG 12,183,699 11.18
Daniel O'Neill and Sarah O'Neill as trustees of the O'Neill 2021 Discretionary Settlement 7,399,392 6.79
Canaccord Genuity Wealth Limited 4,210,344 3.86
Employee Benefit Trust (Intertrust Employee Benefit Trustee Limited) 3,596,624 3.30
Schroder Investment Management Ltd 3,308,941 3.04
Between the period end date and 23une 2023 being the latest practicable date prior to the date of thisreport, the
Company had been notified of the following holding:
Daniel O’Neill 17,048,725 15.65%
Fackelmann GmbH + Co. KG 14,348,648 13.17%
Provision of services by substantial shareholders
Daniel O’Neill is the Company’s Founder and CEO and has a beneficial interest in 36.02% of the Company’s issued share
capital. This includes shares held by Sarah O’Neill, and by Daniel O’Neill and Sarah O’Neill as trustees of the O’Neill 2021
Discretionary Settlement. Further details can be found in the Annual Report on Remuneration on pages 102 to 107.
Group plc Annual Report and Accounts 2023 111
Governance Report
Directors’ Report
Continued
Significant agreements
Daniel O’Neill, Sarah O’Neill, Michael O’Neill, Richard O’Neill, and Daniel and Sarah O’Neill as trustees of the O’Neill 2021
Discretionary Settlement (together, the “Controlling Shareholders”) collectively exercise or control 69.30% of the
Company’s voting rights. The Company has entered into a Relationship Agreement with the Controlling Shareholders
to ensure that the Company is managed for the benefit of its shareholders as a whole and (save in respect of any duties,
responsibilities and actions of Daniel O’Neill as an Executive Director and Richard O’Neill as an employee of the Company)
independently of the Controlling Shareholders, and that the principle of equality of treatment of shareholders set out in
Premium Listing Principle 5 of Listing Rule 7.2.1AR is upheld and maintained. The agreement also ensures that all transactions,
agreements and arrangements between the Company and any of the Controlling Shareholders is on an arm’s length basis
and on normal commercial terms. Both the Company and the Controlling Shareholders have complied with these provisions.
The agreement remains in place until the Controlling Shareholders cease to exercise or control 20% or more in aggregate
of the total voting rights of the Company. The agreement would also automatically terminate were the Company to cease
to be listed on the premium segment of the Official List and admitted to trading on the main market of the London Stock
Exchange.
Change of control
Change of control provisions are included in the Company’s banking agreements. Should a change of control event occur,
the Company’s revolving credit facility would be subject to immediate cancellation and the bank may call for immediate
repayment of anybalance outstanding.
Viability statement
The Board has undertaken a comprehensive review and assessment of long term viability over the period to 29 March 2026
including the Group’s financial projections, debt servicing requirements, available facility headroom and liquidity, and its
principal risks and uncertainties. In the base case scenario, and in the other downside scenarios which the Directors have
reviewed, the Group remains comfortably within its available facility headroom, and no facility covenants would be breached.
However, the Directors recognise that under the severe but plausible downside scenario, the Group is likely to breach its
fixed charge covenant unless mitigating actions can be applied sufficiently in advance to prevent such a breach, requiring
agreement of a covenant waiver, new banking terms, or alternative funding arrangements, none of which can be guaranteed.
The Directors therefore acknowledge that this potential breach represents a material uncertainty which may cast significant
doubt over the Group’s long term viability.
The Board considers the likelihood of such a severe downside scenario materialising to be low and recognises the range
of mitigating actions available to the Group to prevent a breach occurring, and the positive and long-standing relationship
which the Group has with its banking partner HSBC. The Directors therefore have a reasonable expectation that the Group
has adequate resources to continue in operational existence and meet its liabilities as they fall due over across all three years
of the period under review.
Directors’ statement regarding disclosure of information to the Auditor
The Directors confirm that, so far as they are each aware, there is no relevant audit information of which the Company’s
Auditor is unaware. The Directors also confirm that they have taken all reasonable steps to make themselves aware of any
relevant audit information and to establish that the Company’s Auditor is aware of thatinformation.
Appointment of Auditor
On the recommendation of the Audit and Risk Committee, resolutions will be proposed at the 2023 AGM to re-appoint
Mazars LLP as Auditor of the Company and to authorise the Audit and Risk Committee to set the Auditor’s remuneration.
Annual General Meeting
The Company’s AGM will be held at 11am on 19 September 2023. Details of the resolutions to be proposed at the AGM are set
out in the Notice of Meeting, which is provided to all shareholders.
The Directors’ Report was approved by the Board of Directors and authorised for issue on 27 June 2023.
For and on behalf of the Board
Dan Walden
Chief Financial Officer
27 June 2023
Group plc Annual Report and Accounts 2023112
Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Annual Report and the Group and Parent Company financial statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and Parent Company financial statements for each financial year.
Under that law they are required to prepare the Group financial statements in accordance with UK-adopted international
accounting standards in conformity with the requirements of the Companies Act 2006 and applicable law. In addition,
the Group consolidated financial statements are required under the UK Disclosure Guidance and Transparency Rules to
be prepared in accordance with UK-adopted International Financial Reporting Standards as issued by the International
Accounting StandardsBoard.
Under company law, the Directors must not approve the financial statements unless they are satisfied that they give a true
and fair view of the state of affairs of the Group and Parent Company and of the Group’s profit or loss for that period. In
preparing each of the Group and Parent Company financial statements, the Directors are required to:
• Select suitable accounting policies and then apply them consistently
• Make judgements and estimates that are reasonable, relevant and reliable
• State whether they have been prepared in accordance with international accounting standards in conformity with the
requirements of the Companies Act 2006, and as regards the Group financial statements, the UK-adopted International
Financial Reporting Standards as issued by the International Accounting Standards Board
• Assess the Group and Parent Company’s ability to continue as a going concern, disclosing, as applicable, matters related
to goingconcern
• Use the going concern basis of accounting unless they either intend to liquidate the Group or the Parent Company or to
cease operations or have no realistic alternative but todo so.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Parent
Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Parent Company and
enable them to ensure that its financial statements comply with the Companies Act 2006.
They are responsible for such internal control as they determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking
such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other
irregularities. Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report,
Directors’ Report, Directors’ Remuneration Report and Corporate Governance Statement which comply with that law and
those regulations.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the
Group’s website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
Responsibility statement of the Directors in respect of the annual financial report
We confirm that to the best of our knowledge:
• The financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair
view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the
consolidation taken as a whole; and
• The Strategic Report includes a fair review of the development and performance of the business and the position of the
issuer and the undertakings included in the consolidation, taken as a whole, together with a description of the principal
risks and uncertainties that they face. We consider the Annual Report and Accounts, taken as a whole, is fair, balanced and
understandable and provides the information necessary for shareholders to assess the Group’s position and performance,
business model and strategy.
Daniel O’Neill Dan Walden
Chief Executive Officer Chief Financial Officer
27 June 2023 27 June 2023
Group plc Annual Report and Accounts 2023 113
Governance Report
Independent Auditors’ Report
to the members of ProCook Group plc
Opinion
We have audited the financial statements of ProCook Group Plc (the ‘parent company’) and its subsidiaries (the ‘group’)
for the 52 weeks to 2 April 2023 which comprise the consolidated income statement, consolidated statement of financial
position, consolidated statement of cash flows and consolidated statement of changes in equity, parent company
statement of financial position and parent company statement of changes in equity and notes to the financial statements,
including a summary of significant accounting policies.
The financial reporting framework that has been applied in the preparation of the group financial statements is applicable law
and UK-adopted international accounting standards (‘IFRS’).
The financial reporting framework that has been applied in the preparation of the parent company financial statements is
applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable
in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice), as applied in accordance with
the provisions of the Companies Act 2006.
In our opinion:
• the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs as at 2 April
2023 and of the group’s loss for the period then ended;
• the group financial statements have been properly prepared in accordance with UK-adopted international accounting
standards;
• the group financial statements have been prepared in accordance with the requirements of the Companies Act 2006; and
• the parent company financial statements have been properly prepared in accordance with United Kingdom Generally
Accepted Accounting Practice, as applied in accordance with the provisions of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the “Auditor’s responsibilities for the audit of the financial
statements” section of our report. We are independent of the group and the parent company in accordance with the ethical
requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as
applied to listed entities and public interest entities and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Material uncertainty related to going concern
We draw attention to page 126 in the financial statements, which indicates that under a severe but plausible downside
scenario the Group is likely to breach its fixed charge covenant unless mitigating actions can be applied sufficiently in
advance to prevent such a breach. A covenant breach may require agreement of a covenant waiver, new banking terms or
alternative funding arrangements that are not solely executable within the ability and discretion of the Directors. As a result,
the Directors therefore acknowledge that this potential breach represents a material uncertainty which may cast significant
doubt on the group’s and the parent company’s ability to continue as a going concern.
As stated on page 128 these events or conditions, along with the other matters as set out in the viability assessment on page
72 of the Annual Report, indicate that a material uncertainty exists that may cast significant doubt on the group’s and the
parent company’s ability to continue as a going concern.
Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in
the preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the group’s and the
parent company’s ability to continue to adopt the going concern basis of accounting included, but was not limited to:
• Undertaking an initial assessment at the planning stage of the audit to identify events or conditions that may cast
significant doubt on the group’s and the parent company’s ability to continue as a going concern;
• Obtaining an understanding of the relevant controls relating to the directors’ going concern assessment;
• Making enquiries of the directors to understand the period of assessment considered by them, the assumptions
they considered and the implication of those when assessing the group’s and the parent company’s future financial
performance;
Group plc Annual Report and Accounts 2023114
Financial Statements
• Challenging the appropriateness of the directors’ key assumptions in their cash flow forecasts, as described on page 127
by reviewing supporting and contradictory evidence in relation to these key assumptions and assessing the directors’
consideration of severe but plausible scenarios. This included assessing the viability of mitigating actions within the
directors’ control;
• Inspecting the terms of loan agreements and financing facilities for covenants, and assessing the extent to which they are
restrictive and have been accurately included in severe but plausible scenarios;
• Inspecting the changes in the terms and conditions of financing facilities and covenants, and any changes in the terms that
may impact conclusions in relation to material uncertainties;
• Re-performing directors’ calculations and the mathematical accuracy of financial forecasts;
• Performing retrospective analysis to assess budgetary and forecasting accuracy, and the extent to which such
performance informs the assumptions in future cash flow forecast;
• Considering the consistency of the directors’ forecasts with other areas of the financial statements and our audit; and
• Evaluating the appropriateness of the directors’ disclosures in the financial statements on going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant
sections of this report.
In relation to ProCook Group Plc’s reporting on how it has applied the UK Corporate Governance Code, we have nothing
material to add or draw attention to in relation to:
• the directors’ identification in the financial statements of the material uncertainty related to the group’s and the parent
company’s ability to continue as a going concern over a period of at least twelve months from the date of approval of the
financial statements.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not
due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy; the allocation of
resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of
our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters.
We summarise below the key audit matters in forming our opinion above, together with an overview of the principal audit
procedures performed to address each matter and our key observations arising from those procedures. The matters set
out below are in addition to the “Material uncertainty related to going concern” above which, by its nature, is also a key audit
matter.
These matters, together with our findings, were communicated to those charged with governance through our Audit
Completion Report.
Group plc Annual Report and Accounts 2023 115
Financial Statements
Independent Auditors’ Report
to the members of ProCook Group plc
Key Audit Matter How our scope addressed this matter
Disclosure of non-underlying items (Group)
Refer to Note 3 – Total non-underlying items - £6,363k
The Directors have determined that non-underlying items
should be disclosed separately in the Consolidated Income
Statement in order to provide a consistent and comparable
view of the underlying performance of the Group. ProCook
defines non-underlying as ‘transactions that, in the
opinion of the Directors, should be disclosed separately
from the reported Consolidated Income Statement in
order to provide a consistent and comparable view of the
underlying performance of the Group. This will include
those items that relate to non-recurring events and are
material in nature and which have been incurred outside of
the normal business operations, including but not limited to
restructuring and fund-raising activities.’
In current year the following expense items have been
classified as non-underlying;
• Depreciation, rates, rent and other costs relating to the
development of, and transition to, the new Distribution
Centre and Warehouse premises (£749k);
• The impairment of right-of-use assets and PPE, following
an assessment of the carrying value of all retail CGUs
as a result of the identification of impairment triggers
(£4,405k); and
• Consistent with FY22, Share based payment charges
relating to the IPO (£1,209k).
There is a significant risk relating to the classification of
expenses as adjusting items given the impact this may have
on the readers of the financial statements and their view of
underlying business performance.
The determination of such items is judgmental and subject
to a higher risk of error and fraud. We attribute the fraud
risk to the incentive and opportunities to inflate underlying
earnings and performance, which could give rise to an
underlying profit rather than a loss.
Our audit procedures included, but were not limited to:
• Obtaining and inspecting a management judgement
paper on the classification of non-underlying items and
challenging management on the rationale for non-
underlying expenses.
• Challenging management’s assessment, calculation and
allocation of expenses as adjusting, including the extent
to which they are non-reoccurring per the definition
determined by management.
• Obtaining a breakdown of all non-underlying debit and
credit items, challenging management on the nature
of the item and agreeing a sample of transactions to
supporting evidence such as invoices.
• Challenging management on the extent to which
the adjusting items are presented fairly as non-IFRS
Alternative Performance Measures (‘APM’) and are
balanced and understandable in the annual report.
• Comparing APM disclosures to peers to assess the
understandability and reasonableness of the disclosures.
Our observations
Based on the work performed we were satisfied that
the use of non-underlying items are appropriate and
disclosedfairly.
Group plc Annual Report and Accounts 2023116
Key Audit Matter How our scope addressed this matter
Leases - Impairment of store-level CGUs (Group)
Refer to Note 3 – Impairment expense £4,405k
There is a significant risk relating to the carrying value of
Right-Of-Use assets (‘ROUA’) and PPE included in Cash
Generating Units (‘CGU’) is a result of increased economic
uncertainty and the performance of the Group.
The Directors are required to determine the CGU and
assess the CGU for impairment triggers on an annual basis.
Where impairment triggers are identified, the Directors are
required to calculate a Value-In-Use (‘VIU’) for each CGU
and compare this to the carrying amount of the CGU.
There is increased uncertainty in future cashflows at the
CGU level, in particular where stores have underperformed
versus budget.
The calculation of a VIU requires the Directors to make
estimates and judgements relating to forecast cash
inflows to be generated by the CGUs and determine an
appropriate Weighted Average Cost of Capital (‘WACC’) to
discount the forecast cash inflows.
Where the VIU is close to the carrying value of the CGU the
estimates and judgement might be sensitive, with small
changes in the estimates giving rise to material changes in
the carrying value of the CGU.
These estimates and judgements give rise to a Key Audit
Matter and significant risk relating to both error and fraud
Our audit procedures included, but were not limited to:
• Obtaining and inspecting a management judgement
paper detailing the impairment trigger assessment per
IAS 36.
• Challenging management on store performance and the
completeness and integrity of data used in impairment
assessments.
• Comparing and contrasting managements impairment
trigger assessment to external market data.
• Inspecting the completeness of managements
impairment assessment and validation that all open
stores were included in the assessment.
• Inspecting that fixed assets per store have been
appropriately allocated to each CGU identified.
• Inspecting the contribution of individual stores and
performing of retrospective analysis to assess the
reasonableness and historical accuracy of forecasts.
• Challenging of management on the calculation of the
discount rate and the determination that the discount
rate is appropriate for the nature of the lease assets.
• Using independent valuation experts to assess and
challenge the discount rate calculated by management.
• Agreeing assumptions to supporting documentation
such as board’s approved budgets.
• Recalculating the mathematical accuracy of the
calculations.
• Inspecting that impairment losses are disclosed in
accordance with applicable accounting standards.
Our observations
Based on the work performed we were satisfied that the
impairment attributed to the carrying value of the right-of-
use assets and PPE is reasonable per IAS 36.
Group plc Annual Report and Accounts 2023 117
Financial Statements
Independent Auditors’ Report
to the members of ProCook Group plc
Key Audit Matter How our scope addressed this matter
Valuation of investment (Company)
Refer to £117.3m Gross Balance and Net Balance £69.1m
The carrying value of ProCook Group plc’s investments in
subsidiary is significant, representing 97% of total assets in
the entity.
There is a risk of error relating to the identification of
impairment triggers, and the calculation of a VIU if
impairment triggers are identified.
As a result of the economic downturn, and market
capitalisation lower than the carrying value of the
investment, we determined that it was likely impairment
triggers had been identified.
The VIU assessment requires estimates and judgements
to be made to forecast the cash inflows generated by
the CGU and determine an appropriate WACC. There is a
significant risk of error in relation to the estimation of cash
flows, and the determination of the WACC, that could
result in material misstatement of the carrying value of the
investment in subsidiary.
As a result we have determined this to be a Key Audit
Matter.
Our audit procedures included, but were not limited to:
• Obtaining and inspecting a management judgement
paper detailing the impairment trigger assessment per
FRS 102 Section 27.
• The inspection of management’s inputs and key
assumptions in VIU calculations, including the
mathematical accuracy of the calculations.
• Agreeing assumptions to supporting documentation
such as board’s approved budgets.
• Assessing the underlying assumptions behind the
impairment assessment, and challenging management
on alternative assumptions and estimates by using
alternative data sources.
• Using independent valuation experts to assess and
challenge the discount rate calculated by management.
• Comparison of the carrying value with alternative and
disconfirming date points, such as the year-end market
capitalisation.
• Inspecting the disclosures made in the financial
statements to ensure they cover the requirements of FRS
102 section 27.
Our observations
Based on the work performed, we were satisfied that
the valuation of the investment is appropriate net of the
impairment calculated.
Our application of materiality and an overview of the scope of our audit
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality.
These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and
extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect
of misstatements, both individually and on the financial statements as a whole. Based on our professional judgement, we
determined materiality for the financial statements as a whole as follows:
Group materiality
Overall materiality £440k
How we determined it 7.5% set based on a benchmark of underlying profit before tax (‘PBT’) using an average PBT
over the past 3 years.
Rationale for benchmark
applied
Profit Before Tax is the primary benchmark for Public Interest Entities. The entity is profit
orientated and we have determined that Profit Before Tax is of principal interest to the users
of the financial statements. Average PBT has been selected due to the fluctuation of PBT for
the period ended 2 April 2023.
Performance materiality Performance materiality is set to reduce to an appropriately low level the probability that
the aggregate of uncorrected and undetected misstatements in the financial statements
exceeds materiality for the financial statements as a whole.
We set performance materiality at £286k, which represents 65% of overall materiality on a
rounded basis.
Reporting threshold We agreed with the directors that we would report to them misstatements identified during
our audit above £22k as well as misstatements below that amount that, in our view, warranted
reporting for qualitative reasons.
Group plc Annual Report and Accounts 2023118
Parent company materiality
Overall materiality £220k
How we determined it 0.3% of Total Equity
Rationale for benchmark
applied
ProCook Group Plc is a holding entity, and therefore not profit or revenue focused. Total
Equity is deemed to be the most appropriate benchmark for the users of the financial
statements. We have selected 0.3% of Total Equity which is capped at component
materiality.
Performance materiality Performance materiality is set to reduce to an appropriately low level the probability that
the aggregate of uncorrected and undetected misstatements in the financial statements
exceeds materiality for the financial statements as a whole.
We set performance materiality at £153k, which represents 70% of overall materiality.
Reporting threshold We agreed with the directors that we would report to them misstatements identified during
our audit above £10k as well as misstatements below that amount that, in our view, warranted
reporting for qualitative reasons.
As part of designing our audit, we assessed the risk of
material misstatement in the financial statements, whether
due to fraud or error, and then designed and performed
audit procedures responsive to those risks. In particular, we
looked at where the directors made subjective judgements,
such as assumptions on significant accountingestimates.
We tailored the scope of our audit to ensure that we
performed sufficient work to be able to give an opinion on
the financial statements as a whole. We used the outputs of
our risk assessment, our understanding of the group and the
parent company, their environment, controls, and critical
business processes, to consider qualitative factors to ensure
that we obtained sufficient coverage across all financial
statement line items.
Our group audit scope included an audit of the group and
the parent company financial statements. Based on our risk
assessment, all components of the group, including the
parent company, were subject to full scope audit performed
by the group audit team. Our audit scope covered 100% of
revenue, total assets and PBT. All components were audited
by the same audit team.
At the parent company level, the group audit team also
tested the consolidation process and carried out analytical
procedures to confirm our conclusion that there were no
significant risks of material misstatement of the aggregated
financial information.
Other information
The other information comprises the information included
in the Annual Report and Accounts 2023 other than the
financial statements and our auditor’s report thereon. The
directors are responsible for the other information. Our
opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly
stated in our report, we do not express any form of assurance
conclusion thereon.
Our responsibility is to read the other information and, in
doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge
obtained in the course of audit or otherwise appears
to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material
misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that
there is a material misstatement of this other information, we
are required to report that fact.
We have nothing to report in thisregard.
Opinions on other matters prescribed by the
Companies Act 2006
In our opinion, the part of the directors’ remuneration report
to be audited has been properly prepared in accordance
with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of
the audit:
• the information given in the strategic report and the
directors’ report for the financial year for which the
financial statements are prepared is consistent with
the financial statements and those reports have
been prepared in accordance with applicable legal
requirements;
• the information about internal control and risk
management systems in relation to financial reporting
processes and about share capital structures, given in
compliance with rules 7.2.5 and 7.2.6 in the Disclosure
Guidance and Transparency Rules sourcebook made
by the Financial Conduct Authority (the FCA Rules),
is consistent with the financial statements and has
been prepared in accordance with applicable legal
requirements; and
• information about the parent company’s corporate
governance code and practices and about its
administrative, management and supervisory bodies and
their committees complies with rules 7.2.2, 7.2.3 and 7.2.7
of the FCA Rules.
Group plc Annual Report and Accounts 2023 119
Financial Statements
Independent Auditors’ Report
to the members of ProCook Group plc
Matters on which we are required to report by
exception
In light of the knowledge and understanding of the group
and the parent company and their environment obtained
in the course of the audit, we have not identified material
misstatements in the:
• strategic report or the directors’ report; or
• information about internal control and risk management
systems in relation to financial reporting processes and
about share capital structures, given in compliance with
rules 7.2.5 and 7.2.6 of the FCA Rules.
We have nothing to report in respect of the following matters
in relation to which the Companies Act 2006 requires us to
report to you if, in our opinion:
• adequate accounting records have not been kept by the
parent company, or returns adequate for our audit have
not been received from branches not visited by us; or
• the parent company financial statements and the part of
the directors’ remuneration report to be audited are not in
agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by
law are not made; or
• we have not received all the information and explanations
we require for our audit; or
• a corporate governance statement has not been prepared
by the parent company.
Corporate governance statement
The Listing Rules require us to review the directors’
statement in relation to going concern, longer-term viability
and that part of the Corporate Governance Statement
relating to ProCook Group Plc’s compliance with the
provisions of the UK Corporate Governance Statement
specified for our review.
Based on the work undertaken as part of our audit, we
have concluded that each of the following elements of the
Corporate Governance Statement is materially consistent
with the financial statements or our knowledge obtained
during the audit:
• Directors’ statement with regards the appropriateness of
adopting the going concern basis of accounting and any
material uncertainties identified, set out on page 128;
• Directors’ explanation as to its assessment of the entity’s
prospects, the period this assessment covers and why
they period is appropriate, set out on page 112;
• Directors’ statement on fair, balanced and
understandable, set out on page 113;
• Board’s confirmation that it has carried out a robust
assessment of the emerging and principal risks, set out
on page 62;
• The section of the annual report that describes the review
of effectiveness of risk management and internal control
systems, set out on page 90; and
• The section describing the work of the audit committee,
set out on page 90.
Responsibilities of Directors
As explained more fully in the directors’ responsibilities
statement set out on page 113, the directors are responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to
enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the group’s and the parent
company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors
either intend to liquidate the group or the parent company
or to cease operations, or have no realistic alternative but
to do so.
Auditor’s responsibilities for the audit of the
financial statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not
a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial
statements.
The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below.
Irregularities, including fraud, are instances of non-
compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above,
to detect material misstatements in respect of irregularities,
including fraud.
Based on our understanding of the group and the parent
company and their industry, we considered that non-
compliance with the following laws and regulations
might have a material effect on the financial statements:
employment regulation, health and safety regulation, anti-
money laundering regulation and data protection.
To help us identify instances of non-compliance with these
laws and regulations, and in identifying and assessing the
risks of material misstatement in respect to non-compliance,
our procedures included, but were not limited to:
Group plc Annual Report and Accounts 2023120
• Gaining an understanding of the legal and regulatory
framework applicable to the group and the parent
company, the industry in which they operate, and the
structure of the group, and considering the risk of acts by
the group and the parent company which were contrary to
the applicable laws and regulations, including fraud;
• Inquiring of the directors, management and, where
appropriate, those charged with governance, as
to whether the group and the parent company is in
compliance with laws and regulations, and discussing their
policies and procedures regarding compliance with laws
and regulations;
• Inspecting correspondence with relevant licensing or
regulatory authorities;
• Reviewing minutes of directors’ meetings in the year; and
• Discussing amongst the engagement team the laws
and regulations listed above, and remaining alert to any
indications of non-compliance.
We also considered those laws and regulations that have a
direct effect on the preparation of the financial statements,
such as: tax legislation, pension legislation, the Companies
Act 2006.
In addition, we evaluated the directors’ and management’s
incentives and opportunities for fraudulent manipulation of
the financial statements, including the risk of management
override of controls. We determined that the principal risks
related to posting manual journal entries to manipulate
financial performance and management bias through
judgements and assumptions in significant accounting
estimates, in particular in relation to the definition of non-
underlying items, impairment of retail and warehouse CGU’s,
revenue recognition (which we pinpointed to cut-off) and
significant one-off or unusual transactions.
Our procedures in relation to fraud included but were not
limited to:
• Making enquiries of the directors and management on
whether they had knowledge of any actual, suspected or
alleged fraud;
• Gaining an understanding of the internal controls
established to mitigate risks related to fraud;
• Discussing amongst the engagement team the risks of
fraud;
• Addressing the risks of fraud through management
override of controls by performing journal entry
testing; and
• Seeking disconfirming evidence by obtaining external
records to assess management assumptions against.
The primary responsibility for the prevention and detection
of irregularities, including fraud, rests with both those
charged with governance and management. As with any
audit, there remained a risk of non-detection of irregularities,
as these may involve collusion, forgery, intentional
omissions, misrepresentations or the override of internal
controls.
The risks of material misstatement that had the greatest
effect on our audit are discussed in the “Key audit matters”
section of this report.
A further description of our responsibilities is available on the
Financial Reporting Council’s website at www.frc.org.uk/
auditorsresponsibilities. This description forms part of our
auditor’sreport.
Other matters which we are required
toaddress
We were appointed by the Audit and Risk Committee on
22 November2021 to audit the financial statements for the
period ending 3 April 2022 and subsequent financial periods.
The period of total uninterrupted engagement is 2 years,
covering the periods ending 3 April 2022 to 2April 2023.
The non-audit services prohibited by the FRC’s Ethical
Standard were not provided to the group or the parent
company and we remain independent of the group and the
parent company in conducting our audit.
Our audit opinion is consistent with our additional report to
the audit committee.
Use of the audit report
This report is made solely to the company’s members
as a body in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the company’s members those
matters we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility
to anyone other than the company and the company’s
members as a body for our audit work, for this report, or for
the opinions we have formed.
Charlene Lancaster (Senior Statutory
Auditor)
for and on behalf of Mazars LLP
Chartered Accountants and StatutoryAuditor
One St Peter’s Square
Manchester
M2 3DE
27 June 2023
Group plc Annual Report and Accounts 2023 121
Financial Statements
Consolidated Income Statement
For the 52 weeks ended 2 April 2023
52 weeks ended 2 April 2023 52 weeks ended 3 April 2022
£’000s Note Underlying
Non-
underlying Reported Underlying
Non-
underlying Reported
Revenue 1 62,340 - 62,340 69,154 - 69,154
Cost of sales (23,994 ) - (23,994 ) (24,111 ) - (24,111 )
Gross profit 38,346 - 38,346 45,043 - 45,043
Operating expenses 2 (37,645 ) (6,159 ) (43,804 ) (36,277 ) (9,400 ) (45,677 )
Other income 6 51 - 51 407 - 407
Operating profit/(loss) 752 (6,159 ) (5,407 ) 9,173 (9,400 ) (227 )
Finance expense 9 (861 ) (204 ) (1,065 ) (623 ) - (623 )
Other (losses)/gains 10 (55 ) - (55 ) 944 - 944
(Loss)/profit before tax (164 ) (6,363 ) (6,527 ) 9,494 (9,400 ) 94
Tax credit/(expense) 11 29 1,559 1,588 (1,900 ) 1,720 (180 )
Profit/(loss) for the period (135 ) (4,804 ) (4,939 ) 7,594 (7,680 ) (86 )
Total comprehensive income/(loss) (135 ) (4,804 ) (4,939 ) 7,594 (7,680 ) (86 )
Earnings per ordinary share - basic 13 (0.12 )p (4.53 )p 7.34 p (0.01 )p
Earnings per ordinary share - diluted 13 (0.12 )p (4.53 )p 6.76 p (0.01 )p
Group plc Annual Report and Accounts 2023122
Consolidated Statement of Financial Position
As at 2 April 2023
£’000s Note
As at 2 April
2023
As at 3 April
2022
Assets
Non-current assets
Intangible assets 14 235 363
Property, plant, and equipment 15 7,781 5,801
Right-of-use assets 16 25,450 20,985
Deferred tax asset 11 2,520 1,175
Total non-current assets 35,986 28,324
Current assets
Inventories 17 11,515 16,759
Trade and other receivables 18 2,240 1,975
Current tax asset 611 271
Cash and cash equivalents 19 1,962 3,782
Total current assets 16,328 22,787
Total assets 52,314 51,111
Liabilities
Current liabilities
Trade and other payables 20 7,276 8,278
Lease liabilities 16 2,836 2,844
Provisions 21 200 173
Borrowings 22 4,716 5,540
Total current liabilities 15,028 16,835
Non-current liabilities
Trade and other payables 20 954 816
Lease liabilities 16 26,430 19,605
Provisions 21 612 444
Total non-current liabilities 27,996 20,865
Total liabilities 43,024 37,700
Net Assets 9,290 13,411
Equity and reserves attributable to Shareholders of ProCook Group plc
Share capital 26 1,090 1,090
Ordinary Shares to be issued 27 6,891 5,801
Share Premium 26 1 1
Retained earnings 26 1,308 6,519
Total equity and reserves 9,290 13,411
The consolidated financial statements on pages 122 to 155 were approved by the Board of Directors on 27 June 2023 and
were signed on its behalf by:
Dan Walden
Chief Financial Officer
27 June 2023
Group plc Annual Report and Accounts 2023 123
Financial Statements
Consolidated Statement of Cash Flow
For the 52 weeks ended 2 April 2023
£’000s Note
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Cash flows from operating activities
(Loss)/Profit before tax (6,527 ) 94
Adjustments for:
Depreciation of property, plant, and equipment 15 967 860
Amortisation of Intangible assets 14 128 52
Loss on disposal of property, plant, and equipment 2 37 135
Profit on termination of leases (75 ) (50 )
Amortisation of right-of-use assets 16 4,034 3,056
Impairment 2 4,405 -
Unrealised FX (gains)/losses 10 518 (1,098 )
Share Based Payments 1,090 5,837
Finance expense 9 1,065 623
Decrease/(Increase) in inventories 17 5,244 (6,671 )
Increase in trade and other receivables (413 ) (372 )
(Decrease)/Increase in trade and other payables (1,233 ) 3,822
Increase in provisions 21 195 59
Income taxes paid (97 ) (2,041 )
Net cash flows from operating activities 9,338 4,306
Investing activities
Purchase of property, plant, and equipment 15 (4,928 ) (3,165 )
Purchase of intangible assets 14 - (348 )
Lease inception costs (460 ) (248 )
Lease incentives received 204 -
Net cash (used in) investing activities (5,184 ) (3,761 )
Financing activities
Interest paid on borrowings (294 ) (156 )
Interest paid on lease liabilities 9 (771 ) (467 )
Proceeds from borrowings 18,689 28,320
Repayment of borrowings (19,701 ) (25,583 )
Lease principle payments 16 (3,625 ) (2,910 )
Proceeds from the issue of shares - 54
Dividends paid 12 (272 ) (1,900 )
Net cash (used in) financing activities (5,974 ) (2,642 )
Net movement in cash and cash equivalents (1,820 ) (2,097 )
Cash and cash equivalents at beginning of the period 3,782 5,879
Cash and cash equivalents at end of period 1,962 3,782
Group plc Annual Report and Accounts 2023124
Consolidated Statement of Changes in Equity
For the 52 weeks ended 2 April 2023
£’000s Note
Share
capital
Share
Premium
Share
Option
Reserve
Retained
earnings
Total
equity
As at 4 April 2021 - - - 9,505 9,505
Total comprehensive loss for the period - - - (86 ) (86 )
Bonus issue 117,300 - - (117,300 ) -
Capital reduction (116,300 ) - - 116,300 -
Share options exercised 54 1 - - 55
Issue of shares 36 - (36 ) - -
Employee Share Based Payment Awards 27 - - 5,837 - 5,837
Ordinary dividends paid - - - (1,900 ) (1,900 )
As at 3 April 2022 1,090 1 5,801 6,519 13,411
Total comprehensive loss for the period - - - (4,939 ) (4,939 )
Employee Share Based Payment Awards 27 - - 1,090 - 1,090
Ordinary dividends paid 12 - - - (272 ) (272 )
As at 2 April 2023 1,090 1 6,891 1,308 9,290
Group plc Annual Report and Accounts 2023 125
Financial Statements
Consolidated Financial Statements
Accounting Policies
General Information
The Group financial statements consolidate those of the ProCook Group plc (the ‘Company’) and its subsidiaries, together
referred to as the ‘Group’. The Company financial statements on pages 156 to 163 present financial information about the
Company as a separate legal entity, and not about the Group as a whole.
ProCook Group plc (the Company) is a public limited company incorporated and domiciled in England and Wales under the
Companies Act 2006 (Registration number: 13679248). The registered office is ProCook, 10 St. Modwen Park, Gloucester,
The principal activity of the Company together with its subsidiary undertakings throughout the period is the sale of
Basis of preparation
otherwise stated.
The Directors have, at the time of approving the financial statements, a reasonable expectation that the Company and Group
have adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the
going concern basis of accounting in preparing the financial statements.
The principal accounting policies adopted in the preparation of the financial information are set out below. These policies
have been consistently applied to all periods presented, unless otherwise stated.
Going concern
The financial statements have been prepared on a going concern basis. The Group has reported a loss before tax of £6.5m
after non-underlying items for the financial year ended 2 April 2023 (FY22: profit before tax of £94k) and had a net asset
position of £9.3m as at 2 April 2023 (3 April 2022: £13.4m), with a net current asset position of £1.3m (3 April 2022: £6.0m).
The Group had net debt (cash and cash equivalents less borrowings) of £2.8m at 2 April 2023 (3 April 2022: £1.8m) with
available liquidity headroom of £13.2m.
In their assessment of going concern the Board has considered a period of at least 12 months from the date of signing these
financial statements. In considering whether it is appropriate to adopt the going concern basis in the preparation of the
financial statements, the Directors have considered the Group’s principal risks and uncertainties and have assessed the
impact of a range of downside scenarios, including a severe but plausible downside scenario, on the Group’s expected
financial performance, position, and cash generation. The scenarios have been informed by a comprehensive review of
the macroeconomic environment, including the Group’s experience of trading through challenging periods such as the
Covid-19 pandemic, and the most recent macro-economic downturn in which consumers have been impacted by significant
inflationary pressures.
Consideration has been given to the availability of facility headroom and covenant compliance within the Group’s financing
facilities, details of which are set out below and in note 22:
1. An uncommitted trade finance facility of £6.0m. There are no covenants associated with this facility.
2.A Revolving Credit Facility (“RCF”) of £10.0m which was entered into on 20 April 2022 (expiring in April 2025, with a one-
year extension option to April 2026) with two covenants in respect of fixed charge cover and leverage. Shortly after the
year-end, on the 5 May 2023, the Group successfully finalised an amendment to the RCF terms in respect of the fixed
charge cover covenant, which had been agreed with HSBC during March 2023 in order to provide additional headroom
against that covenant given that the Group’s EBITDA performance declined during the year and would have breached the
test at the end of the financial year without action. The revised test requires EBITDAR to be no less than 1.25x fixed charges
for the FY23 Q4 and FY24 Q1 test dates, and 1.40x thereafter. The leverage coverage remains unchanged with net debt
to be no greater than 2.0x EBITDA. Both covenants are tested quarterly and calculated on a last twelve month rolling, pre-
IFRS 16 bases.
The base case for the scenario modelling extends from the annual budget plan that was approved by the Board in April 2023.
Forecasts for future periods are based on the Group’s strategic plan and its five year financial plan, which project forwards
from the FY24 budget.
Group plc Annual Report and Accounts 2023126
Key assumptions include Ecommerce and Retail like for like revenue growth, gross margin performance reflecting the return
to more normal marine freight costs, the financial impacts of opening of new stores (including capital investments and time
to maturity), operational efficiencies being delivered, investment in brand marketing activities, and the appropriate level of
inventory required to maintain strong availability for customers.
In their consideration of the Group’s principal risks and uncertainties the Board believes that the most likely and
most impactful risks that the Group faces are those surrounding customer and macro-economic factors, marketing
effectiveness, and financial and treasury risks, all of which are heightened as a result of the current macro-environment.
The Board has reviewed the potential downside impacts of these risks unfolding, modelled under a number of scenarios
including a severe but plausible downside scenario which reflected the following assumptions:
• A significant reduction in customer demand and shopping frequency, caused by continued macro inflationary pressures
and further increases in interest rates throughout the going concern period, resulting in a 15% lower revenue performance
in the FY24 year to go compared to base case (with LFL revenue declining a further -5%pts compared to year to date
performance), increasing to a 20% decrease compared to base case in FY25.
• Heightened competition to acquire customers in the market as demand falls, results in a 10% increase in the cost of
customer acquisition through online channels.
• The level of promotional activity required to convert customers increases and coupled with a deterioration in GBP against
the US dollar, gross profit margins reduce by 200bps compared to base case, commencing in H2 FY24.
• The increase in interest rates results in an increase of 100bps in the Group’s cost of borrowing through its facilities.
Under this severe but plausible downside scenario, and before mitigating actions, the Group would remain within its £10m
committed borrowing facilities throughout the next 12 months and remain compliant with the leverage covenant test.
However, it would breach the fixed charge covenant at the Q2 FY24 test date. The Group has a positive and long-standing
relationship with its banking partner HSBC, however there is no guarantee that a covenant waiver, new banking terms, or
alternative funding arrangements could be agreed within an acceptable period, and there is therefore the risk that current
funding arrangements could be withdrawn.
The Board has also reviewed a reverse stress test which has been applied to the base case model to determine the level of
sales decline which would result in a breach of financial covenants. A reduction in revenue, with no mitigations applied, of
approximately 11% in Q2 FY24 (representing a year on year decline in LFL revenue of -12% in the remainder of FY24), would be
required to breach fixed charge covenants at that quarter-end test date. A further reduction in revenue of 21% in FY25 would
be required to breach fixed charge covenants in that year.
The other downside scenarios linked to the key principal risks and uncertainties, which were considered by the Board, have a
cumulative impact which was similar to the severe but plausible downside scenario outlined above.
The Board has also considered the potential impacts of climate change risks (as set out on page 48 to 50). These are not
considered to have a material effect on the Group’s financial projections over the assessment period.
If any of the downside scenarios were to arise, including the severe but plausible downside scenario and the reverse stress
test scenario, there are a series of mitigating actions that the Group could seek to implement to protect or enhance financial
performance and position including to:
• Increase selling prices for products which have lower price elasticity to help offset additional sourcing costs
• Increase promotional activity to accelerate trading performance and reduce stock levels, or alternatively, reduce
promotional activity to better protect gross margins
• Reduce paid media, above-the-line or retention marketing spend
• Reduce non-variable costs in operational functions to reflect the lower sales volumes
• Reduce central overhead costs (including headcount investment) over the short or medium term
• Delay capital expenditure in retail, technology, and logistics
• Renegotiate payment terms with suppliers
• Seek alternative forms of financing to support working capital and investment requirements
Group plc Annual Report and Accounts 2023 127
Financial Statements
Conclusion
The Board has undertaken a comprehensive review and assessment of going concern including the Group’s financial
projections, debt servicing requirements, available facility headroom and liquidity, and its principal risks and uncertainties.
In the base case scenario, and in the other downside scenarios which the Directors have reviewed, the Group remains
comfortably within its available facility headroom, and no facility covenants would be breached. However, the Directors
recognise that under the severe but plausible downside scenario, the Group is likely to breach its fixed charge covenant,
unless mitigating actions can be applied sufficiently in advance to prevent such a breach, requiring agreement of a covenant
waiver, new banking terms, or alternative funding arrangements, none of which can be guaranteed. The Directors therefore
acknowledge that this potential breach represents a material uncertainty which may cast significant doubt on the Group’s
ability to continue as a going concern.
The Board considers the likelihood of such a severe downside scenario materialising to be low and recognises the range of
mitigating actions available to the Group to prevent such a breach occurring, and the positive and long-standing relationship
which the Group has with its banking partner HSBC. The Directors therefore have a reasonable expectation that the Group
has adequate resources to continue in operational existence and meet its liabilities as they fall due over the period of at least
12 months from the date of approving these financial statements. Accordingly, the financial statements have been prepared
under the going concern basis of accounting.
Further information regarding the Group’s business activities, together with the factors likely to affect its future
development, performance and position is set out in the Strategic Report on pages 2 to 73.
Critical accounting estimates and judgements
The Group makes certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated
based on historical experience and other factors, including expectations of future events that are believed to be reasonable
under the circumstances. In the future, actual experience may differ from these estimates and assumptions. Revisions to
accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.
The key estimates and judgements that are used within the financial statements are set out below:
Judgement: Lease terms and expiries
Judgement is exercised in determining the lease term and expiry date of the lease. IFRS 16 defines the lease term as the
non-cancellable period of a lease together with the options to extend or terminate a lease, if the lessee were reasonably
certain to exercise that option, or when either the lessee or the lessor each has the right to terminate the lease without
permission from the other party with no more than an insignificant penalty. The Group has assessed the likelihood of
exercising a break option by considering current economic and market conditions, current trading performance, forecast
profitability, the significance of any fees payable, and the level of capital investment in the property, as well as the status of
any open dialogue with Landlords. The Group typically determines the lease term to be the full term of the lease, assuming
that any option to break or extend the lease is unlikely to be exercised and it is not reasonably certain on inception, that the
Group will continue in occupation for any period beyond the lease term. Subsequent adjustments are made to the lease
terms where break options are reassessed and determined more likely than not to be exercised.
Judgement: Indicators of Impairment
The Group has determined that only stores that have been open and trading for at least 24 months would be assessed for
impairment triggers. However, where maturing stores are not yet on track to meet their original business case performance
(or projected to be), the Group has determined it is appropriate to include such stores in any such assessment. The Group
has reviewed recent financial performance of individual CGUs and considered the wider economic environment, and a range
of other potential factors, to identify any indicators of impairment.
The Group has concluded that given the uncertainty in the macro-economic backdrop, and the recently experienced
decline in like-for-like sales, that there were indicators of impairment at the year-end date which therefore required further
assessment for potential impairment across all CGUs. Additionally, given the Group’s transition to its new Distribution Centre
and Warehouse premises, there are indicators of impairment in respect of the two pre-existing sites which will soon no
longer be operational.
Estimate: Discount rates
IFRS 16 states that the lease payments shall be discounted using the lessee’s incremental borrowing rate where the rate
implicit in the lease cannot be readily determined. Accordingly, all lease payments have been discounted using the Group’s
incremental borrowing rate (IBR). The IBR has been determined by using a range of data including current economic and
market conditions, review of current debt and capital within the Group and comparisons against seasoned corporate bond
rates. A 100 basis points increase in the IBR across all leases would lead to a decrease in the lease liability of £(0.5)m (2022:
£(0.9)m). Further details can be found in note 16.
Consolidated Financial Statements
Accounting Policies Continued
Group plc Annual Report and Accounts 2023128
Estimate: Dilapidations
The Group has estimated the dilapidations provision in respect of anticipated future restoration costs of each of the Group’s
leasehold properties in the event that any individual location is vacated by the Group.
These future costs are estimated based on actual retail property historical average costs per square foot (or the Group’s
best estimates for non-retail sites where appropriate) the Group has incurred to vacate and make good a property plus
inflation, and any specific contractual requirements detailed within lease contracts. The provision for restoration costs have
been discounted to their present value and unwound using an appropriate risk-free rate. A 10 percentage point increase
in the estimated cost per square foot would result in an increase in the dilapidations provision of £0.07m (2022: £0.05m).
Further details can be found in note 21.
Estimate: Impairment Provision
The Group has performed an impairment assessment in respect of all Retail CGU’s which have indicators of impairment as
well as the Group’s two Distribution / Headquarter sites which will soon no longer be operational following the transition to
the Group’s new site.
To perform the Retail CGU impairment assessment, the Group has determined the value-in-use of each CGU over its
remaining useful life. In doing this, estimates have been made on future financial performance in order to determine a
reasonable estimate for the value-in-use of each CGU. The forecast financial performance based on the Group’s five-year
plan, has been prepared utilising both historical experience as well as forward-looking estimates with respect to trading
conditions and performance. In this assessment, consideration has been given to the directly attributable profits generated
by each CGU after all directly attributable costs including logistics, occupancy, and salary costs as well as a proportion of
central costs. Once all future cash flows have been estimated, they have been discounted using the Group pre-tax WACC of
12.8%.
To perform the impairment assessment in respect of the Group’s two Distribution/ Headquarter sites, consideration has
been given to future anticipated sub-lease income which will be generated from the sites, as well as the occupancy costs
(including lease liability costs) over the remaining life of the lease to their lease expiry or break point. Consideration has also
been given to the duration with which the properties will be empty to accurately estimate future income.
The Group has determined that it is appropriate to recognise an impairment provision of £3.3m in respect of retail CGUs
and £1.1m in respect of the two Distribution / Headquarter sites, both of which have been expensed to the Consolidated
Income Statement within non-underlying items as each are material in nature, and by virtue of their relationship to future
performance, are not considered related to the performance of the financial year ended 2 April 2023. A 100 basis points
reduction in forecasted sales growth would lead to an increase in the retail impairment provision of £0.2m. A one percentage
point increase in the weighted average cost of capital would lead to an increase in the retail impairment provision of £56k.
A three month delay beyond what has been assumed in obtaining a new tenant in the disused warehouses would lease to an
increase in the impairment provision of £0.3m.
Basis of consolidation
Group companies included in the consolidated financial statements for FY23 include ProCook Group plc and all subsidiary
undertakings, which are those entities which it controls. ProCook Group plc controls an entity when it is exposed to, or has
rights to, variable returns from its involvement with the entity and can affect those returns through its power to direct the
activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to ProCook Group plc
until the date that control ceases. The Company assesses whether it controls an investee if facts and circumstances indicate
that there are changes to one or more of the elements of control indicators listed above.
Where necessary, amounts reported by subsidiaries have been adjusted to conform with ProCook Group plc’s accounting
policies.
Transactions eliminated on consolidation
Intra-group balances, and any unrealised gains and losses or income and expenses arising from intra-group transactions are
eliminated in preparing the financial information. Losses are eliminated in the same way as gains, but only to the extent that
there is no evidence of impairment.
Group plc Annual Report and Accounts 2023 129
Financial Statements
Revenue recognition
The Group records customer transactions through its store point of sale systems and its ecommerce platforms. Revenue is
recognised at the point in time when the Group delivers a product or service to a customer, whether this be at the point of
sale in store, or later upon delivery to a customer. Payment of the transaction price is due immediately when the customer
purchases the product in store or upon ordering online.
Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added
tax and other sales taxes. Revenue is reduced for estimated customer returns, and other similar allowances.
Deferred income
Sales made through the Group’s website are recognised at the point the product is delivered to the customer. Deferred
income is recognised as a creditor at the point where the order has been received and not yet despatched, or where the
goods have been despatched but are yet to be delivered to the customer.
Refunds and returns
At the point at which goods are supplied, the Group provides customers with a right to return goods within a 90-day period
for a full refund subject to certain terms and conditions. The Group has established a refunds and returns other payables
balance within the Consolidated Statement of Financial Position to provide for the expected level of returns on sales made
before the period end but returned after the period end. The provision for returns is calculated based on estimated refund
and return rates using historical trends. The associated estimated value of cost of sales related to the returned items is also
reflected within inventory.
Expenses
Share-based payments
The Group operates a number of shared based compensation plans which are all equity settled, in exchange for services
received from employees. The fair value of these compensation plans is calculated at the grant date using the Black-Scholes
model. The resulting cost is expensed to the Consolidated Income Statement over the vesting period. The value of the
expense is adjusted to reflect expected and actual levels of vesting, considering any performance conditions which may
apply to individual plans.
Social security contributions payable in connection with the grant of the share options are considered an integral part of the
grant itself and the expense is treated as a cash-settled transaction.
No other entities in the Group other than ProCook Group plc have issued any equity-settled share-based incentives.
Employee benefits
The costs of short-term employee benefits are recognised as an expense in the Consolidated Income Statement as
incurred. The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are
received.
Termination benefits are recognised immediately as an expense when the Group is demonstrably committed to terminate
the employment of an employee or to provide termination benefits.
Pensions
The Group operates a defined contribution pension scheme using an external pensions partner. Contributions to the scheme
are expensed to the Consolidated Income Statement in the period to which the contributions relate. The assets of the
scheme are held separately from those of the Group.
There have been no significant changes during the period relating to the current scheme, nor its membership and terms and
conditions.
Non-underlying items
Non-underlying items are defined as transactions that, in the opinion of the Directors, should be disclosed separately from
the reported Consolidated Income Statement in order to provide a consistent and comparable view of the underlying
performance of the Group. This will include those items that relate to non-recurring events and are material in nature and
which have been incurred outside of the normal business operations, including but not limited to restructuring and fund-
raising activities.
Finance income and expenses
Finance income comprises interest on bank deposits.
Finance expense comprises of interest payable on the Group’s finance facilities and lease liability interest which are
expensed to the Consolidated Income Statement in the period in which they are incurred.
Consolidated Financial Statements
Accounting Policies Continued
Group plc Annual Report and Accounts 2023130
Other operating income
Other operating income represents all other income received by the Group.
This includes rental income and Government grants. Government grants are recognised at their fair value where there is
reasonable assurance that the grant will be received, and the Group will comply with all relevant conditions. Government
grants relating to costs are deferred and recognised in the Consolidated Income Statement over the period necessary to
match them with the costs that they are intended to compensate.
Foreign currency translation
Transactions in foreign currencies are recorded at the rate of exchange prevailing at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies, are retranslated at the rate of exchange prevailing at the end of the
reporting period. Any exchange gains or losses are recognised in the Consolidated Income Statement.
Current and deferred taxation
Taxation, comprising current and deferred taxation, is recognised in the Consolidated Income Statement, except where a
charge attributable to an item of income or expense recognised as other comprehensive income or to an item recognised
directly in equity is also recognised in other comprehensive income or directly in equity, respectively.
Current tax on profits or losses for the period, is calculated based on tax rates and laws that have been enacted or
substantively enacted by the reporting date in the UK where the Group operates and generates taxable income.
Deferred tax balances in the Consolidated Statement of Financial Position are recognised in respect of all temporary
differences that have originated but not reversed by the balance sheet date, except where:
• The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the
reversal of deferred tax liabilities or other future taxable profits;
• Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been
met; and
• Where timing differences relate to interests in subsidiaries, associates, branches and joint ventures and the Group can
control their reversal and such reversal is not considered probable in the foreseeable future.
Where applicable the Group makes claims for Research and Development (R&D) tax reliefs in accordance with the Research
and Development Expenditure Credit (RDEC) scheme. Qualifying projects are assessed to ensure the claims made fit the
criteria and definitions set out by the UK HM Revenue and Customs. R&D tax relief claims are recognised in the tax expense
line of the Consolidated Income Statement.
Dividends
Ordinary dividends proposed by the Board of Directors are only recognised in the Consolidated Statement of Financial
Position when they have been approved by the shareholders, and the Company is obliged to make payment.
Intangible assets
Intangible assets with finite useful lives that are either acquired separately or internally developed are carried at cost less
accumulated amortisation and accumulated impairment losses.
Directly attributable costs associated with software development by the Group’s own IT experts, in respect of customised
IT programmes and systems controlled by the Group are capitalised as intangible assets, provided they meet the following
recognition requirements:
• The development costs can be measured reliably
• The project is technically and commercially feasible
• The Group intends to and has sufficient resources to complete the project
• The Group has the ability to use or sell the software
• The software will generate probable future economic benefits.
Software development costs not meeting these criteria are classified as research or maintenance expenditure and are
expensed to the Consolidated Income Statement as they are incurred. Directly attributable costs include employee costs
incurred on software development and external developer costs.
The estimated useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any
changes in estimate being accounted for on a prospective basis.
Group plc Annual Report and Accounts 2023 131
Financial Statements
Intangible assets are amortised on a straight-line basis over their estimated useful lives. Assets under construction are
capitalised as expenditure is incurred, with amortisation commencing from the point at which the asset starts being utilised
by the Group. Annual impairment assessments are undertaken to ensure the valuations remain appropriate. Amortisation is
provided on the following basis:
• Intangibles (Software) 3 years, straight line
Property plant and equipment
Property, plant, and equipment acquired and owned by the Group is stated at historical cost less accumulated depreciation
and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the
asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Assets under construction are capitalised as expenditure is incurred and tested for impairments annually. Depreciation is
• Land and buildings 5 – 10 years, straight line
• Plant and machinery 10 – 20 years, straight line
• Fixtures and fittings 3 – 10 years, straight line (or over term of the lease)
• Motor vehicles 3 years, straight line
The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate,
or if there is an indication of a significant change since the last reporting date. At each reporting period end date, the
Group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets
have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any).
The recoverable amount is the higher of the asset’s fair value less any costs to sell and its value in use. If the recoverable
amount of an asset is estimated to be less than it’s carrying amount, the carrying amount of the asset is reduced to its
recoverable amount and an impairment loss is recognised immediately in the Consolidated Income Statement.
Gains and losses on disposals are determined by comparing any proceeds on disposal with the carrying amount and are
recognised in the Consolidated Income Statement.
Leased assets
At inception of a new contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration.
To assess whether a contract conveys the right to control the use of an identified asset, the Group assesses whether a
physically distinct asset can be identified; the Group has the right to obtain substantially all of the economic benefits from
the asset throughout the period of use; the Group has the ability to direct the use of the asset over the lease term; and is able
to restrict the usage of third parties as applicable.
Leases are recognised in the Consolidated Statement of Financial Position as a right-of-use asset with a corresponding
lease liability except for:
• Leases of low value assets (less than £5,000); or
• Leases with a duration of 12 months or less.
Right-of use-assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and
increased for:
• Lease payments made at or before commencement of the lease;
• Initial direct costs incurred; and
• The amount of any provision recognised where the Group is contractually required to dismantle, remove, or restore the
leased asset.
Lease liabilities are recognised in the Consolidated Statement of Financial Position measured at the present value of the
contractual payments due to the lessor over the lease term, with the discount rate determined by reference to the rate
inherent in the lease unless (as is typically the case) this is not readily determinable, in which case the Group’s incremental
borrowing rate on commencement of the lease is used.
Consolidated Financial Statements
Accounting Policies Continued
Group plc Annual Report and Accounts 2023132
On initial recognition, the carrying value of the lease liability also includes:
• Amounts expected to be payable under any residual value guarantee;
• The exercise price of any purchase option granted in favour of the Group if it is reasonably certain to access that
option; and
• Any penalties payable for terminating the lease, if the term of the lease has been estimated on the basis of the termination
option being exercised.
Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance
outstanding and are reduced for lease payments made. Right-of-use assets are amortised on a straight-line basis over
the remaining term of the lease or over the remaining economic life of the asset if, rarely, this is judged to be shorter than
the lease term. When the Group revises its estimate of the term of any lease (because, for example, it re-assesses the
probability of a lessee extension or termination option being exercised), it adjusts the carrying amount of the lease liability
to reflect the payments to make over the revised term, which are discounted at the revised discount rate applicable at the
date of estimation. An equivalent adjustment is made to the carrying value of the right-of-use asset, with the revised carrying
amount being amortised over the remaining (revised) lease term.
Where the Group’s property leases contain variable payment terms, payments determined as variable are treated as
a charge to the Consolidated Income Statement and not capitalised. Variable lease payments are only included in the
measurement of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the lease
liability assumes the variable element will remain unchanged throughout the lease term.
Dilapidations
The value of any provision for contractually committed future costs to dismantle, remove or restore a leased asset are
included in the initial measurement of a right-of-use asset.
Inventories
Inventory is recognised in the Consolidated Statement of Financial Position at the lower of cost and net realisable value.
Cost is determined on a weighted average cost basis and comprises all costs of purchase and other costs incurred in
bringing the inventories to their present location and condition. Net realisable value is the amount that can be realised from
the sale of the inventory in the normal course of business after allowing for the costs of realisation.
Inventory in transit at the period end is included within inventory at cost, where ownership of legal title by the Group can be
readily determined.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of inventory over its
estimated selling price less costs to sell is recognised as an impairment loss in the Consolidated Income Statement. In the
current period, the Group has determined that it should reduce the carrying value of inventory to recognise the estimated
exposure to writing off damaged items held at cost within inventory at the year end, which will subsequently be disposed of
by the Group when identified as damaged of faulty after the year end. Reversals of impairment losses are also recognised in
Consolidated Income Statement.
Trade and other receivables
Trade receivables are initially recognised when they are originated.
The Group makes use of a simplified approach in accounting for trade and other receivables and records the loss allowance
as lifetime expected credit losses. These are the expected shortfalls in contractual cash flows, considering the potential for
default or any other failure to make payment to the Group in line with agreed terms, at any point during the life of the financial
instrument. In calculating this, the Group uses its historical experience, external indicators, and forward-looking information
to calculate the expected credit losses.
The Group assesses impairment of trade receivables on a collective basis as they possess shared credit risk characteristics
based on grouping debt by days overdue.
Cash and cash equivalents
Cash and cash equivalents are liquid financial assets and include cash in hand, deposits held on call with banks, cash in transit
to the Group in respect of debit and credit card receipts, and other short-term liquid investments with original maturities of
three months or less.
Trade and other payables
Trade and other payables are recognised at fair value on the Consolidated Statement of Financial Position.
Group plc Annual Report and Accounts 2023 133
Financial Statements
Financial instruments
Financial instruments are all financial assets and financial liabilities that comprise a contract that gives rise to a financial asset
of one entity and a financial liability or equity instrument of another entity and are detailed in note 25.
Financial assets and financial liabilities are recognised in the Consolidated Statement of Financial Position when the Group
becomes party to the contractual provisions of the instrument. Financial assets and financial liabilities are initially measured
at fair value. Transaction costs that are directly attributable (other than financial assets or liabilities at fair value through profit
or loss are added to or deducted from the fair value as appropriate, on initial recognition.
A financial liability is derecognised when the obligation under the liability is discharged, cancelled, or expires. A financial
asset is derecognised when the rights to receive cash flows from the asset have expired.
The fair values of financial instruments measured at amortised cost and derivative instruments recognised at fair value are
disclosed in note 25.
Financial assets
Financial assets are subsequently classified into the following categories:
• Financial assets at fair value through profit or loss;
• Fair value through other comprehensive income; or
• Amortised cost.
The classification depends on the nature and purpose of the financial asset (i.e., the Group’s business model for managing
the financial assets and the contractual terms of the cash flows) and is determined at the time of initial recognition.
They are measured at amortised cost if they are held within a business model whose objective is to hold financial assets in
order to collect contractual cash flows and the contractual terms give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.
Financial assets not held at amortised cost or fair value through other comprehensive income are held at fair value through
profit or loss. At present the Group only has financial assets held at amortised cost, apart from derivatives which are
measured at fair value through profit or loss.
Financial liabilities
Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the
contractual arrangements.
Equity instruments are any contract that evidences a residual interest in the assets of an entity after deducting all of its
liabilities. Equity instruments are recognised at proceeds received net of issue costs.
Financial liabilities are classified as either financial liabilities at fair value through profit or loss or financial liabilities at
amortised cost, which are measured using the effective interest method. At present the Group only has financial liabilities
held at amortised cost, apart from derivatives which are measured at fair value through profit or loss.
Impairment of financial assets
IFRS 9 requires the use of forward-looking information to recognise expected credit losses – the ‘expected credit loss
model’. Recognition of credit losses is not dependent on the Group first identifying a credit loss event; instead, the Group
considers a broader range of information when assessing credit risk and measuring expected credit losses, including past
events, current conditions and reasonable and supportable forecasts that affect the expected collectability of the future
cash flows of the instrument.
Derivatives
Derivatives are initially recognised in the Consolidated Statement of Financial Position at fair value at the date a derivative
contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or
loss is recognised in the Consolidated Income Statement within other gains/(losses) immediately unless the derivative is
designated and effective as a hedging instrument, in which event the timing of the recognition in Consolidated Income
Statement depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is
recognised as a financial liability.
Consolidated Financial Statements
Accounting Policies Continued
Group plc Annual Report and Accounts 2023134
Provisions
Provisions are recognised in the Consolidated Statement of Financial Position where a legal or constructive obligation has
been incurred which will probably lead to an outflow of resources that can be reasonably estimated. The amount recognised
as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date,
taking into consideration the risks and uncertainties surrounding the obligation. The timing of cash outflows are by their
nature uncertain and are therefore best estimates. A contingent liability is disclosed where the existence of the obligations
will only be confirmed by future events, or where the amount of the obligation cannot be measured with reasonable
reliability.
Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is
recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a
finance cost in the Consolidated Income Statement in the period in which it arises.
Warranties
All ProCook products are offered with a warranty ranging from 12 months to 25 years. This warranty provides the customer
with the right to return the product, should it not be performing in the manner as described when the product was purchased.
The customer is then entitled to a replacement product free of charge.
All warranties in the Group are assurance type warranties as the Group assures that the product will perform as expected. The
Group’s warranties do not provide any additional services to the customer and are not able to be purchased separately; the
warranties provide a guarantee to the customer that the product will perform as expected.
The Group maintains a warranty provision in respect of future expected cost of claims outstanding at the year-end, based on
sales which are accompanied by product warranties made prior to the financial year-end and historical return rate trends.
Dilapidations
The Group maintains a dilapidations provision in respect of its future restoration cost obligations in respect of leasehold
properties occupied by or previously occupied by the Group as at the financial year-end, based on historical average costs
incurred to vacate and make good a property, and any specific contractual requirements detailed within lease contracts.
Borrowings
Interest-bearing loans are initially recorded at their fair value and subsequently held at amortised cost. Arrangement and
transaction fees incurred are amortised over the term of the loan. Borrowings are classed as current liabilities unless the
Group has a right to defer settlement of the liability for at least 12 months after date of the Consolidated Statement of
Financial Position.
Share Capital
Changes in the share capital structure are recognised within equity on the Consolidated Statement of Financial Position,
with any excess over the nominal share price being recognised within Share premium. Where the Company purchases its
own equity share capital (treasury shares) the consideration paid, including any directly attributable incremental costs, is
deducted from the equity attributable to the Company’s equity holders until the shares are cancelled or reissued. Where
such shares are subsequently sold or reissued, any consideration received net of any directly attributable incremental
transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.
Impairment of non-financial assets
At the end of each reporting period, the Group reviews the carrying amounts of its non-financial assets to determine
whether there is an indication of impairment. For impairment purposes, assets are grouped at the lowest levels for which
there are largely independent cash inflows (cash-generating unit or CGU). As a result, some assets are tested individually for
impairment, and some are tested at the CGU level. Management considers CGUs to be determinable by individual store and
the various ecommerce platforms.
Assets and CGUs are tested for impairment whenever events or changes in circumstances indicate that the carrying amount
may not be recoverable. An impairment loss is recognised for the amount by which the assets or CGU’s carrying amount
exceeds its recoverable amount, which is the higher of fair value less costs of disposal and value-in-use.
Group plc Annual Report and Accounts 2023 135
Financial Statements
To determine the value-in-use, management estimate expected future cash flows from the CGU and determine a suitable
discount rate to calculate the present value of those cash flows. Discount factors are determined for the CGU to reflect
current market assessments of the time value of money and asset-specific risk factors.
Impairment charges are allocated on a pro-rata basis in accordance with the CGU’s carrying amounts. In allocating the
impairment loss to a CGU the carrying amount of each asset within the CGU is reduced to the highest of either its fair
value less costs to sell; value-in-use; or nil. Recognition of impairment losses do not result in a recognition of a liability. All
assets are subsequently reassessed for indications that an impairment loss previously recognised may no longer exist. An
impairment loss is reversed if the assets or CGU’s recoverable amount exceeds its carrying amount.
Segmental reporting
The Group’s operating segments are reported in a manner consistent with the internal reporting provided to the Board of
Directors. The Board is identified as the Chief Operating Decision-Maker (‘CODM’) for the business and is responsible for
making strategic decisions, allocating resources, and assessing performance of the operating segments. The Group is
considered to have two operating segments: Ecommerce and Retail.
Revenues and underlying operating profits for both segments are generated from the sale of kitchenware and related
products. Each segment has separate operational characteristics and are identifiable by way of where the customer
completes their transaction; either in a retail store, or via one of the ecommerce website platforms the Group has operated
during the year.
New standards, amendments, and interpretations
New standards impacting the Group that have been adopted for the financial year ended 3 April 2022 and year ending 2 April
2023 are as follows:
• Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37);
• Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16);
• Annual Improvements to IFRS Standards 2018-2020 (Amendments to IFRS 1, IFRS 9, IFRS 16 and IAS 41);
• References to Conceptual Framework (Amendments to IFRS 3).
Following an assessment, the Group have determined that these standards do not have a material impact upon the Group’s
Consolidated Financial Statements.
New standards, amendments and interpretations not yet adopted
There are several standards, amendments to standards, and interpretations which have been issued by the IASB that are
effective in future accounting periods that the Group has decided not to adopt early. The following amendments are
effective for the period beginning 3 April 2023:
• IFRS 17 (including the June 2020 amendments to IFRS 17) Insurance Contracts
• Amendments to IFRS 10 and IAS 28 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture
• Amendments to IAS 1 Classification of Liabilities as Current or Non-current
• Amendments to IAS 1 and IFRS Practice Statement 2 Disclosure of Accounting Policies
• Amendments to IAS 1 non-current liabilities with covenants
• Amendments to IAS 8 Definition of Accounting Estimates
• Amendments to IAS 12 Deferred Tax related to Assets and Liabilities arising from a Single Transaction
• Amendments to IFRS 16 Sale and Leaseback
The Group do not expect these standards to have a material impact on its Consolidated Financial Statements either in the
current reporting period or future reporting periods.
Consolidated Financial Statements
Accounting Policies Continued
Group plc Annual Report and Accounts 2023136
Notes to the Consolidated Financial Statements
1. Revenue
Group revenue is not reliant on any single major customer or group of customers. Management considers revenue is derived
from one business stream being the retail of kitchenware and related products and services.
Customers interact and shop with the Group across multiple touchpoints and their journey often involves more than one
channel. The Chief Operating Decision-maker is the Board of Directors of ProCook Group plc. The Board reviews internal
management reports on a frequent basis, and in line with internal reporting, the channel reporting below indicates where
customers complete their final purchase transaction.
The majority of the Group’s operations are carried out in the UK, with a smaller proportion of the Group’s revenue being
generated in the European Union. During the financial year ended 2 April 2023 the Group ceased its trading operations in the
European Union. All revenue is from external customers.
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
United Kingdom 61,550 66,124
European Union 790 3,030
Total revenue 62,340 69,154
2. Operating expenses
Operating profit/(loss) for the periods is stated after charging:
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Depreciation of tangible fixed assets 967 860
Amortisation of Intangible assets 128 52
Amortisation of right-of-use assets 4,034 3,056
Impairment of tangible fixed assets 1,944 –
Impairment of right-of-use assets 2,461 –
Variable lease payments 785 985
Loss on disposal of property, plant, and equipment 37 174
Total R&D expenditure included in operating expenses for the 52 weeks ended 2 April 2023 was £nil (52 weeks ended 3 April
2022: £0.6m).
3. Non-underlying items
Consistent with FY22, expenses in respect of employee share-based awards which relate to the IPO event in that year, which
itself is non-recurring, have been presented as non-underlying costs. These expenses are expected to continue through
relevant vesting periods to FY25, albeit these costs reduce over time.
During the financial year ended 2 April 2023, the Group consolidated its head office and warehouse operations into a new
site. Operating expenses of £0.7m associated with occupying the site while its development was completed, and the costs
of transitioning into the new site have been presented as non-underlying costs as these costs are non-recurring, dual-
running and transition-related.
The Group’s impairment assessment has resulted in an expense to the Consolidated Income Statement of £3.3m (2022:
£nil) in respect of Retail CGU impairment and £1.1m (2022: £nil) in respect of the Group’s two pre-existing distribution /
head office sites. These have been presented as non-underlying items as each are material in nature, and by virtue of their
relationship to future performance, are not considered related to the performance of the financial year ended 2 April 2023.
Group plc Annual Report and Accounts 2023 137
Financial Statements
Notes to the Consolidated Financial Statements
Continued
3. Non-underlying items
continued
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
IPO Associated costs – 2,742
Share based payments 1,209 6,658
Headquarters transition-related costs 749 –
Impairment expense 4,405 –
Total 6,363 9,400
4. Segmental reporting
The Chief Operating Decision Maker (CODM) is the Board of Directors and segmental reporting analysis is presented based
on the Group’s internal reporting to the Board. At 2 April 2023, the Group had two operating segments, being Ecommerce
and Retail. Central costs are reported separately to the Board. Whilst central costs are not considered to be an operating
segment, it has been included below to aid reconciliation with operating profit as presented in the Consolidated Income
Statement.
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Revenue
Ecommerce 25,653 32,332
Retail 36,687 36,822
Total revenue 62,340 69,154
Operating loss
Ecommerce 4,588 8,056
Retail 5,319 9,635
Central costs (9,155) (8,518)
Non-underlying operating costs
1
(6,159) (9,400)
Operating loss (5,407) (227)
Non-underlying finance costs
2
(204) –
Finance costs (861) (623)
Other (losses)/gains (55) 944
(Loss)/profit before tax (6,527) 94
1
Included in non-underlying costs for the 52 weeks ended 2 April 2023 is an impairment charge of £3.3m in respect of the Retail segment, and £1.1m in
respect of central segment (3 April 2022: £nil).
2
Non-underlying finance costs are the interest costs on the lease liability for the new head office site.
Substantially all of the assets of ProCook Group plc are located in the UK.
5. Auditor Remuneration
The Group’s total fees paid or payable to its auditor in respect of the audit of the Group’s financial statements and for other
services provided to the Group:
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Audit of Consolidated Financial Statements 39 25
Audit of the Parent Company and Group subsidiary entities 355 120
Other services
1
10 13
Total auditor remuneration 404 158
1
The Group engaged the auditor to undertake certain agreed upon procedures in respect of the interim financial statements.
Group plc Annual Report and Accounts 2023138
6. Other income
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Other income 51 112
Government grants – 295
Total other income 51 407
The government grants received in the 52 weeks ended 3 April 2022 relate to the Government’s Coronavirus Job Retention
Scheme (‘CJRS’), the Government Business Rates Relief Scheme and local restrictions support grants. There are no
unfulfilled conditions or contingencies attached to these grants that have been recognised.
7. Employee numbers and costs
The average monthly number of colleagues employed by the Group including Directors was:
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Retail and distribution staff 564 601
Support staff 121 82
Total 685 683
The total remuneration of all employees including Directors includes:
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Wages and salaries 12,952 12,572
Social security contributions and similar taxes 1,139 947
Other pension costs 305 192
Total 14,396 13,711
Details of Directors’ remuneration including base pay, short and long-term incentive schemes and pension entitlements are
disclosed in the Directors’ Remuneration Policy and Annual Report on Remuneration on pages 94 to 107.
8. Retirement benefit plan
The Group operates a defined contribution retirement benefit scheme for all qualifying employees. The scheme is
administered and managed by a separate third-party specialist pension scheme provider. The total expense recognised in
the Consolidated Income Statement for the 52 weeks ended 2 April 2023 was £305k (3 April 2022: £192k) and represents
contributions payable to these plans by the Group at rates specified in the rules of the plans.
9. Finance expense
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Interest on borrowings and other interest 294 156
Interest on lease liabilities 771 467
Total finance expense 1,065 623
Group plc Annual Report and Accounts 2023 139
Financial Statements
Notes to the Consolidated Financial Statements
Continued
10. Other gains and losses
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
(Loss)/gain on derivatives (518) 1,098
Exchange rate gains/(losses) 463 (154)
Total gains (losses) (55) 944
11. Tax expense
The tax expense for the periods presented differ from the standard rate of UK corporate income tax applicable in the
financial year. The differences are explained below:
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Current taxation
Corporate income tax charge for the period – 1,384
Adjustments in respect of previous years (243) –
(243) 1,384
Deferred tax
Origination and reversal of temporary differences (1,632) (920)
Impact of change in tax rate – (284)
Adjustments in respect of prior periods 287 –
Total tax (credit)/expense (1,588) 180
The tax charge reconciles with the standard rate of UK corporate income tax as follows:
£’000
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Profit on ordinary activities before tax (6,527) 94
UK Corporate income tax at standard rate of 19% (2022: 19%) (1,240) 18
Factors effecting the charge in the period:
Tax effect of expenses that are not deductible for tax purposes (20) 446
Adjustments in respect of prior years (243) –
Adjustments in respect of prior periods (deferred tax) 287 –
Remeasurement of deferred tax for changes in tax rates (372) (284)
Total taxation (credit)/expense (1,588) 180
The underlying taxation expense for the period as a percentage of profit before tax (the effective tax rate) was 17.6%
(2022: 20.0%).
The standard rate of UK corporate income tax was 19% for all periods presented. Deferred tax balances reflect future
corporation tax rates of 25%.
The deferred tax asset has arisen due to accelerated capital allowances on items of property, plant and equipment and
the timing of future vesting dates in respect of share-based payments. The amounts have been presented on a net basis
to follow the way in which they will be recouped by the Group. The following is the analysis of the deferred tax balances for
financial reporting purposes:
Group plc Annual Report and Accounts 2023140
11. Tax expense continued
Movement in the year:
£’000
Accelerated
capital
allowances
Share based
payments
Carried
forward
losses Total
Deferred tax asset as at 3 April 2022 (479) 1,654 – 1,175
(Debit)/Credit to profit and loss (601) 315 1,631 1,345
Deferred tax asset at 2 April 2023 (1,080) 1,969 1,631 2,520
Carried forward losses arise from the tax losses incurred during this financial year. This has been recognised as a deferred tax
asset as the Group believes there is a high degree of likelihood there will be sufficient future profits to offset against over the
medium term planning cycle.
12. Dividends
£’000
52 weeks
ended
2 April 2023
Dividend
per
share
(pence)
52 weeks
ended
3 April 2022
Dividend
per
share
(pence)
Final dividend for the period ended 4 April 2021 – – 1,000 1.0 pence
Interim dividend for the period ended 3 April 2022 – – 900 1.0 pence
Final dividend for the period ended 3 April 2022 272 0.9 pence – –
Interim dividend for the period ended 2 April 2023 – – – –
The FY22 final dividend of £1.0 m was declared representing 0.9 pence per share, however £0.7m of this dividend was
waived by certain shareholders. The final dividend was paid to the shareholders on the register at close of business on
2September 2022.
The FY22 interim dividend of £1.0m was declared and paid representing 1.0 pence per ordinary share, however £0.1m of this
dividend was waived by certain shareholders.
13. Earnings per share
Basic earnings per share is calculated by dividing the profit for the period attributable to equity holders of the Group by the
weighted average number of ordinary shares in issue.
Diluted earnings per share is calculated by dividing the profit for the period attributable to ordinary equity holders of the
parent by the weighted average number of ordinary shares in issue during the period plus the weighted average number
of ordinary shares that would have been issued on the conversion of all dilutive potential ordinary shares into ordinary
shares.
52 weeks
ended
2 April 2023
52 weeks
ended
3 April 2022
Weighted average number of shares 108,956,624 103,509,034
Impact of share options 9,126,940 8,774,159
Number of shares for diluted earnings per share 118,083,564 112,283,193
£’000
52 weeks
ended
2 April 2023
Underlying
1
52 weeks
ended
2 April 2023
Reported
52 weeks
ended
3 April 2022
Underlying
1
52 weeks
ended
3 April 2022
Reported
(Loss)/profit for the period (135) (4,939) 7,594 (86)
Earnings per ordinary share – basic (0.12)p (4.53)p 7.34p (0.01)p
Earnings per ordinary share – diluted (0.12)p (4.53)p 6.76p (0.01)p
1
Underlying earnings per ordinary share is a non-IFRS measure.
Group plc Annual Report and Accounts 2023 141
Financial Statements
Notes to the Consolidated Financial Statements
Continued
14. Intangible assets
£’000 Software
Assets under
construction Total
Cost
At 4 April 2021 – 67 67
Transfers out of Assets under construction 67 (67) –
Additions 190 158 348
At 3 April 2022 257 158 415
Additions – – –
Transfers out of Assets under construction 158 (158) –
At 2 April 2023 415 – 415
Accumulated Amortisation
At 4 April 2021 – – –
Charge for the period 52 – 52
At 3 April 2022 52 – 52
Charge for the period 128 – 128
At 2 April 2023 180 – 180
Net book value
At 4 April 2021 – 67 67
At 3 April 2022 205 158 363
At 2 April 2023 235 – 235
Amortisation was recognised in the Consolidated Income Statement within operating expenses throughout the period.
15. Property, plant, and equipment
£’000
Land and
Buildings
Plant and
Machinery
Fixtures and
Fittings
Motor
Vehicles
Assets under
Construction Total
Cost
At 4 April 2021 34 320 6,044 4 – 6,402
Additions 34 167 2,514 25 425 3,165
Disposals (56) – (96) – – (152)
At 3 April 2022 12 487 8,462 29 425 9,415
Additions – – 1,112 – 3,816 4,928
Transfers 175 21 2,418 – (2,614) –
Disposals – – (241) – – (241)
At 2 April 2023 187 508 11,751 29 1,627 14,102
Accumulated depreciation and
impairments
At 4 April 2021 9 32 2,726 4 – 2,771
Charge for the period 3 31 818 8 – 860
Disposals (9) – (3) (5) – (17)
At 3 April 2022 3 63 3,541 7 – 3,614
Charge for the period 3 34 925 5 – 967
Disposals – – (204) – – (204)
Impairment 1 101 1,838 4 – 1,944
At 2 April 2023 7 198 6,100 16 – 6,321
Net book value
At 4 April 2021 25 288 3,318 – – 3,631
At 3 April 2022 9 424 4,921 22 425 5,801
At 2 April 2023 180 310 5,651 13 1,627 7,781
Group plc Annual Report and Accounts 2023142
15. Property, plant, and equipment continued
Assets under construction includes retail store equipment and fixtures acquired but not yet in use, and certain assets relating
to the new distribution centre and head office which had not been fully developed or commissioned at 2 April 2023.
Impairment tests have been carried out where appropriate and an impairment charge of £1.9m has been recognised in the
52 weeks ended 2 April 2023 (3 April 2022: £nil). This impairment charge relates to a retail wide impairment review where
certain stores have been identified as impaired.
Depreciation was recognised in the Consolidated Income Statement within operating expenses throughout the period.
16. Leased assets
The Group leases a number of assets, with all lease payments fixed over the lease term. Where there are leasehold properties
which hold a variable element to lease payments made these are not fixed and not capitalised as part of the right of use
asset. All expected future non-variable cash out flows are reflected within the measurement of the lease liabilities at each
period end.
As at 2 April
2023
As at 3 April
2022
Number of active leases 71 71
The Group’s leases include leasehold properties for commercial and head office use, motor vehicles and plant equipment.
The leases range in length from 2 to 20 years and vary in length depending on lease type. Leasehold properties hold the
longest-term length of up to 20 years, plant, and equipment up to 5 years, and motor vehicles of up to 5 years.
Extension, termination, and break options
The Group occasionally negotiates extension, termination, or break clauses in its leases. In determining the lease term,
management considers all facts and circumstances that create an economic incentive to exercise an extension option, or
not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term
if the lease is reasonably certain to be extended (or not terminated).
On a case-by-case basis, the Group will consider whether the absence of a break clause would expose the Group to
excessive risk. Typically, factors considered in deciding to negotiate a break clause include:
• The length of the lease term;
• The economic stability of the environment in which the property is located; and
• Whether the location represents a new area of operations for the Group.
Incremental borrowing rate
The Group has adopted a rate with a range of 2% - 6% as its incremental borrowing rate, being the rate that the individual
lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a
similar economic environment with similar terms, security, and conditions. This rate is used to reflect the risk premium over
the borrowing cost measured by reference to the Group’s financing facilities.
Short term or low value lease expense
No short term or low value leases existed during the financial period.
Group plc Annual Report and Accounts 2023 143
Financial Statements
Notes to the Consolidated Financial Statements
Continued
16. Leased assets
continued
Right-of-use assets included in the Consolidated Statement of Financial Position were as follows:
£’000
Leasehold
Property
Motor
Vehicles
Plant and
Equipment Total
Cost
4 April 2021 20,437 179 29 20,645
Additions 7,843 57 39 7,939
Re-measurement
1
241 – – 241
Disposals (2,296) – – (2,296)
At 3 April 2022 26,225 236 68 26,529
Additions 16,336 – – 16,336
Re-measurement (4,371) – – (4,371)
Disposals (1,706) (54) (29) (1,789)
At 2 April 2023 36,484 182 39 36,705
Accumulated amortisation and impairments
At 4 April 2021 2,779 19 13 2,811
Charge for the period 2,974 68 14 3,056
Disposals (323) – – (323)
At 3 April 2022 5,430 87 27 5,544
Charge for the period 3,959 64 11 4,034
Disposals (701) (54) (29) (784)
Impairment 2,461 – – 2,461
At 2 April 2023 11,149 97 9 11,255
Net book value
At 4 April 2021 17,658 160 16 17,834
At 3 April 2022 20,795 149 41 20,985
At 2 April 2023 25,335 85 30 25,450
For impairment testing purposes, the Group has determined that each store is a separate CGU. Each CGU is tested for
impairment at the balance sheet date for any indicators of impairment. Due to the macro-economic environment in the UK,
all stores have been assessed for impairment.
The value in use of each CGU is calculated based on the Group’s latest budget and forecast cash flows, covering a five-year
period, which have regard to historic performance and knowledge of the current market, together with the Group’s views on
the future achievable growth. Cash flows beyond this five-year period are extrapolated using a long-term growth rate based
on management’s future expectations.
The key assumptions in the value in use calculations are the growth rates of sales and gross profit margins, changes in the
operating cost base, long-term growth rates and the risk-adjusted pre-tax discount rate. The pre-tax discount rates are
derived from the Group’s weighted average cost of capital, which has been calculated using the capital asset pricing model,
the inputs of which include a country risk-free rate, equity risk premium, Group size premium and a risk adjustment (beta)
along with the cost of debt. A total impairment charge of £4.4m has been recognised, spread proportionately across the
Group plc Annual Report and Accounts 2023144
16. Leased assets continued
Lease liabilities included in the Consolidated Statement of Financial Position were as follows:
£’000
Leasehold
Property
Motor
Vehicles
Plant and
Equipment Total
At 4 April 2021 19,281 155 15 19,451
Additions 7,615 57 39 7,711
Remeasurement
1
241 – – 241
Interest expense 462 4 1 467
Lease payments (3,286) (75) (16) (3,377)
Disposals (2,044) – – (2,044)
At 3 April 2022 22,269 141 39 22,449
Additions 15,893 – – 15,893
Remeasurement
1
(4,371) – – (4,371)
Interest expense 768 2 1 771
Lease payments (4,318) (67) (11) (4,396)
Disposals (1,080) – – (1,080)
At 2 April 2023 29,161 76 29 29,266
1
Remeasurements have arisen where store lease rental terms and lease expiry dates have been renegotiated.
Reconciliation of minimum lease payments and present value:
£’000
As at 2 April
2023
As at 3 April
2022
Within 1 year 4,147 3,325
More than 1 year and less than 5 years 14,064 11,448
After 5 years 17,066 10,300
Total including interest cash flows 35,277 25,073
Less: interest cash flows (6,011) (2,624)
Total principal cash flows 29,266 22,449
Reconciliation of current and non-current lease liabilities:
£’000
As at 2 April
2023
As at 3 April
2022
Current 2,836 2,844
Non-current 26,430 19,605
Total 29,266 22,449
17. Inventories
£’000
As at 2 April
2023
As at 3 April
2022
Finished goods and goods for resale 11,515 16,759
The cost of Group inventories recognised as an expense in the period to 2 April 2023 amounted to £24.0m (3 April 2022:
£23.4m). This is included in cost of sales.
Within inventory the Group has recognised a provision relating to damaged stock of £123k as at 2 April 2023 (2022: £157k).
Group plc Annual Report and Accounts 2023 145
Financial Statements
Notes to the Consolidated Financial Statements
Continued
18. Trade and other receivables
£’000
As at 2 April
2023
As at 3 April
2022
Trade receivables – 87
Other receivables 840 748
Derivative financial instruments – 148
Prepayments 1,400 992
Total 2,240 1,975
All trade receivables are due within one year from the end of the reporting period. No impairment was incurred on trade
receivables during the period and the expected credit loss provision held at period end is nil (2022: nil). No material amounts
are overdue (2022: nil).
Included in other receivables at the period end is supplier deposits of £512k (3 April 2022: £290k).
19. Cash and cash equivalents
£’000
As at 2 April
2023
As at 3 April
2022
Cash at bank available on demand 1,180 3,058
Cash in transit 782 724
Total 1,962 3,782
20. Trade and other payables
£’000
As at 2 April
2023
As at 3 April
2022
Amounts falling due within one year
Trade payables 1,796 3,280
Other payables 477 154
Accruals 2,768 2,294
Deferred income 81 95
Derivative financial instruments 369 –
Other taxation and social security 1,785 2,455
7,276 8,278
Amounts falling due after one year:
Accruals 954 816
Total 8,230 9,094
The Directors consider that the carrying value of trade and other payables approximates to their fair value. Trade payables
are non-interest bearing and are typically settled monthly. The accruals falling due after one year relate solely to the
Employer National Insurance contributions payable on Share Schemes.
Group plc Annual Report and Accounts 2023146
21. Provisions
£’000
As at 2 April
2023
As at 3 April
2022
Amounts falling due within one year
Warranties 116 133
Dilapidations 84 40
200 173
Amounts falling due after one year:
Warranties 7 7
Dilapidations 605 437
Total 812 617
Provisions for warranties are largely short term in nature given the Group’s experience of the timing of such claims being
largely made within the first year of purchase. The estimated costs to service these claims have minimal uncertainty as they
are based on the cost of the Group’s products.
Provisions for dilapidations are based on the Group’s past experience of existing leasehold property sites. It is estimated
that all dilapidations provisions will occur at the end of the term of the lease.
£’000 Dilapidations Warranties Total
At 3 April 2022 476 141 617
Additions during the year 227 197 424
Unwinding of discount rate 6 – 6
Utilised during the year (20) (215) (235)
At 2 April 2023 689 123 812
22. Borrowings
£’000
As at 2 April
2023
As at 3 April
2022
Current
Bank loans 4,716 5,540
Total borrowings 4,716 5,540
As at 2 April 2023 the Group has access to an uncommitted trade finance facility which expires on 1 October 2023, although
is expected to be renewed at that date, with a maximum limit of £6.0m. There are no covenants associated with this facility.
The following amounts had been drawn down and were outstanding at 2 April 2023: £4.7m (3 April 2022: £5.5m).
The Group has access to a committed £10m Revolving Credit Facility (RCF) to provide additional cash headroom to support
operational and investment activities. This facility expires in April 2025 and has a one-year extension option available to
extend the term to April 2026. Additionally, the RCF agreement provides an accordion option, subject to the lender’s
approval, to extend the facility by a further £5m. No amounts were drawn on this facility at the year end date (3 April
2022: Nil).
Shortly after the year-end, on the 5 May 2023, the Group successfully finalised an amendment to the RCF terms in respect
of the fixed charge cover covenant, which had been agreed with HSBC during March 2023 in order to provide additional
headroom against that covenant given that the Group’s EBITDA performance declined during the year and would have
breached the test at the end of the financial year without action. The revised test requires EBITDAR to be no less than 1.25x
fixed charges for the FY23 Q4 and FY24 Q1 test dates, and 1.40x thereafter. The leverage coverage remains unchanged
with net debt to be no greater than 2.0x EBITDA. Both covenants are tested quarterly and calculated on a last twelve month
rolling, pre-IFRS 16 bases.
The Group has a debenture in place during the year which related to a fixed charge over all present freehold and leasehold
property provided as security to the Group’s Revolving Credit Facility which will remain in place throughout the term of the
facility agreement.
Group plc Annual Report and Accounts 2023 147
Financial Statements
Notes to the Consolidated Financial Statements
Continued
23. Derivatives
The Group’s local currency is Pounds Sterling but due to purchases of goods and services in foreign currencies the Group
seeks to reduce foreign exchange risk by entering into forward contracts and other derivatives. At 2 April 2023, the
outstanding contracts all mature within 18 months of the period end, with committed purchases of $21.5m (3 April 2022:
$33.6m).
The contracts are measured at their fair value, which is determined using valuation techniques that utilise observable
inputs. The key inputs used in valuing the derivatives are the forward exchange rates. The fair value movement of the foreign
currency contracts are detailed in note 10 above.
There were no designated hedges in place during the current or proceeding financial year.
24. Changes in liabilities arising from financing activities
£’000
At 3 April
2022 Repayments Interest
New
borrowings
Other gains
and losses
At 2 April
2023
Short-term borrowings 5,540 (19,995) 294 18,689 188 4,716
Lease liabilities 22,449 (4,396) 771 15,893 (5,451) 29,266
Total liabilities from financing activities 27,989 (24,391) 1,065 34,582 (5,263) 33,982
25. Financial Risk Management
Financial risk management
The Group is exposed through its operation to the following financial risks: credit risk, interest rate risk, foreign exchange
risk and liquidity risk. Risk management is carried out by the Directors of the Group. The Group uses financial instruments to
provide flexibility regarding its working capital requirements and to enable it to manage specific financial risks to which it is
exposed.
The Group finances its operations through a mixture of debt finance, cash and liquid resources and various items such as
trade debtors and trade payables which arise directly from the Business’s operations.
For further information on the Group’s Capital allocation and dividend policy, please see page 51.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its
contractual obligations. To minimise the risk, the Group endeavours only to deal with companies which are demonstrably
creditworthy and this, together with the aggregate financial exposure, is continuously monitored. The maximum exposure
to credit risk is the carrying value of its financial receivables, trade and other receivables and cash and cash equivalents as
disclosed in the notes to the financial information.
The receivables’ age analysis is evaluated on a regular basis for potential doubtful debts, considering historic, current, and
forward-looking information. No impairments to trade receivables, have been made to date. Further disclosures regarding
trade and other receivables are provided within the notes to financial statements.
Credit risk also arises on cash and cash equivalents and deposits with banks and financial institutions. For banks and financial
institutions, only independently rated parties with minimum rating “B+” are accepted.
Currently all financial institutions whereby the Group holds significant levels of cash are rated from B+ to A+.
Interest rate risk
As at 2 April 2023 the Group’s only drawn borrowings are through its trade finance facility with a floating interest rate linked
to the United States Federal funds rate. This is variable on the amount drawn down and there is no fixed settlement date,
therefore the interest rate risk exposure for the Group is minimal. The Group also has a £10m RCF with a floating interest
rate linked to the Bank of England base rate. The Group’s policy aims to manage the interest cost of the Group within the
constraints of its financial borrowings. The Group does not currently use any form of derivatives to manage interest rate
volatility or future rate increases, however it does seek to minimise interest costs through careful management of its use of
facilities.
Group plc Annual Report and Accounts 2023148
25. Financial Risk Management continued
Foreign exchange risk
Foreign exchange risk arises when the Group enter transactions in a currency other than their functional currency. The
Group’s policy is, where possible, to settle liabilities denominated in a currency other than its functional currency with cash
already denominated in that currency.
The Group makes purchases of goods and services from overseas in foreign currencies and uses additional means to cover
its exposure to the foreign exchange movement. The Group uses various financial derivatives such as forward exchange
contracts, to help mitigate movements in foreign currency to restrict losses and to ascertain control of expected cash out
flows. All the Group’s foreign exchange contracts are designated to settle the corresponding liability.
Liquidity risk
The Group seeks to maintain sufficient cash balances to support its working capital and investment requirements.
Management reviews cash flow forecasts on a regular basis to determine whether the Group has sufficient available cash to
meet support its operational and investment activities.
Financial assets
Financial assets measured at amortised cost, which approximates to fair value, comprise trade receivables, other
receivables, and cash.
£’000
As at 2 April
2023
As at 3 April
2022
Trade receivables – 87
Other receivables 840 748
Cash at bank and on hand 1,180 3,782
Total 2,020 4,617
Financial assets measured at fair value include derivative financial assets:
£’000
As at 2 April
2023
As at 3 April
2022
Derivatives – 148
Total – 148
In the 52 weeks ended 3 April 2022, derivatives assets were included within the balance sheet under trade and other
receivables and were recognised under level 2 of the fair value hierarchy.
Financial liabilities
Financial liabilities measured at amortised cost comprise trade and other payables, accruals, borrowings, and lease
liabilities:
£’000
As at 2 April
2023
As at 3 April
2022
Trade payables 1,796 3,280
Other payables 477 154
Accruals 2,768 3,110
Borrowings 4,716 5,540
Lease liabilities 29,266 22,449
Total 39,023 34,533
Group plc Annual Report and Accounts 2023 149
Financial Statements
Notes to the Consolidated Financial Statements
Continued
25. Financial Risk Management
continued
Financial liabilities measured at fair value include derivative financial liabilities, as follows:
As at 2 April
2023
As at 3 April
2022
Derivatives 369 –
Total 369 –
In the 52 weeks ended 2 April 2023, derivatives liabilities are included within the balance sheet under trade and other
payables and are recognised under level 2 and 3 of the fair value hierarchy.
A maturity analysis of the Group’s financial liabilities is shown below. With the exception of lease liabilities (whose payment
schedule spans the term of the respective lease agreements, please see Note 16 for further details) and national insurance
contributions on share based payments, the Groups’ other liabilities as at 2 April 2023 are all due within less than one year:
£’000
As at 2 April
2023
As at 3 April
2022
Due within one year:
Trade payables 1,796 3,280
Other payables 477 154
Accruals 2,768 2,294
Borrowings 4,716 5,540
Lease liabilities 2,836 2,844
Total 12,593 14,112
As at 2 April
2023
As at 3 April
2022
Due within one year:
Derivatives 369 –
Total 369 –
£’000
As at 2 April
2023
As at 3 April
2022
Due after one year:
Accruals 954 816
Lease liabilities 26,430 19,605
Total 27,384 20,421
Further maturity of the Group’s lease liabilities is set out in note 16. All other liabilities which are due after one year are due to
be settled within five years.
The currency profile of the Group’s cash and cash equivalents is as follows:
£’000
As at 2 April
2023
As at 3 April
2022
Sterling 1,531 3,368
US Dollar 249 135
Euro 182 279
Total 1,962 3,782
Group plc Annual Report and Accounts 2023150
25. Financial Risk Management continued
Foreign denominated asset and liability balances held at the year-end are as follows:
£’000
As at 2 April
2023
As at 3 April
2022
Current assets
Cash and cash equivalents 431 414
Current liabilities
Trade and other payables 1,134 1,155
Borrowings 4,716 5,512
Total 6,281 6,667
Substantially all of the trade and other payables positions and borrowings positions shown above are denominated in US
Dollars.
Further information relating to the Group’s hedging of these assets and liabilities is set out in note 23. A $0.01 change in the
Sterling to USD exchange rate would result in a £60k increase/ decrease in the Consolidated Income Statement.
Capital disclosures
The capital structure of the business consists of cash and cash equivalents, debt, and equity. Equity comprises share capital
and retained profit and is equal to the amount shown as ‘Equity’ in the balance sheet. As at 2 April 2023 debt comprised
solely of the borrowings on the Group’s trade finance facility which is set out in further detail above and in the notes to the
accounts.
The Group’s objectives when maintaining capital are to:
• Safeguard the Group’s ability as a going concern so that it can continue to pursue its growth plans.
• Provide a reasonable expectation of future returns to shareholders.
• Maintain adequate financial flexibility to preserve its ability to meet financial obligations, both current and long term.
The Group sets the amount of capital it requires in proportion to risk. The Group manages its capital structure and adjusts it
in the light of changes in economic conditions and the risk characteristics of underlying assets. In order to maintain or adjust
the capital structure, the Group may issue new shares or sell assets to reduce debt.
During the periods presented the Group’s business strategy remained unchanged.
During the periods presented the Group maintained compliance with all relevant facility covenants.
26. Share capital and reserves
£
As at 2 April
2023
As at 3 April
2022
Allotted, called up and fully paid
108,956,624 Ordinary Shares of 1p each 1,089,566 1,089,566
Total 1,089,566 1,089,566
Only one class of shares have been issued which have full voting, dividend, and capital distribution rights.
Reserves
The following describes the nature and purpose of each reserve within equity:
Share premium account: Proceeds received in excess of the nominal value of shares issued, net of any transaction costs
Share option reserve: Used to recognise the value of equity-settled share-based payments expenses. See note 27 for
further details on share-based payment plans.
Retained earnings: All other accumulated net gains and losses and transactions with shareholders not recognised elsewhere.
Group plc Annual Report and Accounts 2023 151
Financial Statements
Notes to the Consolidated Financial Statements
Continued
27. Share based payments
The Group operates several equity-settled share based compensation plans for employees. The vesting date for each
scheme is the last day of the contractual life of the scheme. The terms and conditions of the grants are detailed below:
Date of grant Share Scheme
No. of
options
Exercise
price
(pence)
Vest
conditions Vest Date
12-Nov-21 Leadership IPO Award 3,173,876 0 No 12 November 2021
12-Nov-21 Employee IPO Award 1
1
1,198,688 44 Yes 12 November 2023
12-Nov-21 Employee IPO Award 2
1
1,198,688 29 Yes 12 November 2023
12-Nov-21 Employee IPO Award 3
1
1,198,688 15 Yes 12 November 2024
12-Nov-21 Executive IPO Award 1
1
172,413 0 Yes 12 November 2024
12-Nov-21 Executive IPO Award 2
1
689,655 145 Yes 12 November 2024
12-Nov-21 Leadership ESP Award FY22 706,896 0 Yes 12 November 2024
10-Jan-22 SAYE FY22
1
435,255 112 Yes 12 November 2024
08-Aug-22 Leadership ESP Award FY23
2
2,618,481 0 Yes 8 August 2025
17-Feb-23 SAYE FY23
1
1,330,364 27 Yes 17 February 2026
Total 12,723,004
1
There are no performance conditions attached to these schemes, except that the employee is required to be in employment with ProCook Group
plc on the vest date.
2
The performance conditions for this scheme are set out within the Annual Report on Remuneration on page 104.
The weighted average remaining vest period is 21 months as at 2 April 2023. The fair value of all share options granted are
calculated at the date of grant using a Black-Scholes option pricing model. Given the Group’s admission to the London
Stock Exchange in November 2021, at the date of issue, volatility remained relatively unknown. A reasonable volatility
expectation has therefore been applied by the Group, based on a review of similar businesses’ historical share price volatility.
Detail of inputs are shown below:
Leadership IPO Award 2022
Share price at date of grant 160 pence
Exercise Price 0 pence
Volatility 50%
Expected life 3 years
Risk Free rate 0.67%
Dividend yield 1.19
Fair value per option 156 pence
Employee IPO Award 1 2022
Share price at date of grant 160 pence
Exercise Price 44 pence
Volatility 50%
Expected life 1 year
Risk Free rate 0.67%
Dividend yield 1.19
Fair value per option 115 pence
Group plc Annual Report and Accounts 2023152
27. Share based payments continued
Employee IPO Award 2 2022
Share price at date of grant 160 pence
Exercise Price 29 pence
Volatility 50%
Expected life 2 Years
Risk Free rate 0.61%
Dividend yield 1.19
Fair value per option 127 pence
Employee IPO Award 3 2022
Share price at date of grant 160 pence
Exercise Price 15 pence
Volatility 50%
Expected life 3 years
Risk Free rate 0.61%
Dividend yield 1.19
Fair value per option 140 pence
Executive IPO Award 1 2022
Share price at date of grant 160 pence
Exercise Price 0 pence
Volatility 50%
Expected life 1 year
Risk Free rate 0.67%
Dividend yield 1.19
Fair value per option 154 pence
Executive IPO Award 2 2022
Share price at date of grant 160 pence
Exercise Price 145 pence
Volatility 50%
Expected life 3 years
Risk Free rate 0.67%
Dividend yield 1.19
Fair value per option 56 pence
Leadership ESP Award FY22 2022
Share price at date of grant 160 pence
Exercise Price 0 pence
Volatility 50%
Expected life 3 years
Risk Free rate 0.67%
Dividend yield 1.19
Fair value per option 154 pence
Group plc Annual Report and Accounts 2023 153
Financial Statements
Notes to the Consolidated Financial Statements
Continued
27. Share based payments
continued
SAYE FY22 2022
Share price at date of grant 160 pence
Exercise Price 112 pence
Volatility 50%
Expected life 3 years
Risk Free rate 0.67%
Dividend yield 1.19
Fair value per option 70 pence
Leadership ESP Award FY23 2023
Share price at date of grant 43 pence
Exercise Price 0 pence
Volatility 50%
Expected life 3 years
Risk Free rate 2.46%
Dividend yield 1.98%
Fair value per option 40 pence
SAYE FY23 2023
Share price at date of grant 41 pence
Exercise Price 27 pence
Volatility 76%
Expected life 3 years
Risk Free rate 2.29%
Dividend yield 3.10%
Fair value per option 22 pence
Details of the total number of share options granted, exercised, lapsed and outstanding at the end of each period as well as
the weighted average exercise prices in £ (“WAEP”) are as follows:
As at 2 April As at 3 April
2023 WAEP (£) 2022 WAEP (£)
Outstanding at beginning of period 8,774,159 0.29 858 141.5
Granted during the period 3,948,845 0.09 8,774,159 0.29
Forfeited/lapsed during the period – (858) (142)
Exercised during the period – – –
Outstanding at period end 12,723,004 0.23 8,774,159 0.29
Exercisable at end of period – – – –
A corresponding charge to the Consolidated Income Statement of £1.1m (2022: £5.8m) has been made in respect of
these share options in the period (excluding employer’s national insurance contributions of £0.1m). In total, £1.2m has been
recognised as a non-underlying cost and £0.1m as an underlying credit.
Group plc Annual Report and Accounts 2023154
28. Contingent liabilities
The Group had no contingent liabilities at the year-end date (2022: none).
29. Related Parties
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation
and are not disclosed in this note.
Transactions with Quella Bicycle Limited, a related party by virtue of one of the Group’s Directors (Daniel O’Neill) holding a
financial interest, relate to the renting of warehouse space from ProCook Limited. During the year, Quella Bicycle Limited
were charged £7k for the warehouse rental (3 April 2022: £16k). Payments from Quella totalled £7k during the year (3 April
2022: £19k). The amount receivable at 2 April 2023 was £7k (3 April 2022: £7k).
Transactions with Life’s a Beach Limited, a related party by virtue of one of the Group’s Directors (Daniel O’Neill) being a
trustee, relate to charitable donations made on ProCook sales and other associated transactions. During the year, ProCook
sales generated £52k of donations payable to Life’s a Beach (3 April 2022: £20k). During the year, ProCook made payments
to Life’s a Beach of £52k (3 April 2022: £62k). The amount payable at 2 April 2023 was £7k (3 April 2022: £7k).
Transactions with a director (Daniel O’Neill) in respect of payment of a historical dividend balance outstanding amounted to
£19k during the period (3 April 2022: £77k). Amounts included in other payables at the period ending 2 April 2023 was £nil (3
April 2022: £19k).
Details of the remuneration of the Board can be found on pages 94 to 107.
Group plc Annual Report and Accounts 2023 155
Financial Statements
Parent Company Statement of Financial Position
As at 2 April 2023
£’000s Note
As at 2 April
2023
As at 3 April
2022
Assets
Non-current assets
Investment in subsidiary 4 69,091 117,300
Deferred tax asset 2,292 1,559
Total non-current assets 71,383 118,859
Current assets
Other receivables 5 169 111
Deferred tax asset – 80
Total current assets 169 191
Total assets 71,552 119,050
Liabilities
Current liabilities
Trade and other payables 6 3,254 1,370
Corporation tax payable 76 76
Total current liabilities 3,330 1,446
Non-current liabilities
Trade and other payables 6 749 816
Total non-current liabilities 749 816
Total liabilities 4,079 2,262
Net assets 67,473 116,788
Equity and reserves attributable to Shareholders of ProCook Group plc
Share capital 7 1,090 1,090
Share Option Reserve 8 6,891 5,801
Share Premium 7 1 1
Retained earnings 7 59,491 109,896
Total equity and reserves 67,473 116,788
The Company made a loss after tax of £50.1m in the 52 week period to 2 April 2023 (3 April 2022: £5.5m).
The financial statements for ProCook Group Plc (Company Registration No. 13679248 (England and Wales)) on pages 156 to
163 were approved by the Board of Directors on 27 June 2023 and signed on its behalf by:
Dan Walden
Chief Financial Officer
27 June 2023
Group plc Annual Report and Accounts 2023156
Parent Company Statement of Changes in Equity
For the 52 weeks ended 2 April 2023
£’000s Note
Share
capital
Merger
relief
reserve
Share
Premium
Share
Option
Reserve
Retained
earnings
Total
equity
On incorporation, 14 October 2021 – – – – – –
On acquisition of ProCook Limited – 117,300 – – – 117,300
Bonus issue 117,300 (117,300) – – –
Capital reduction (116,300) – – – 116,300 –
Share options exercised 54 – 1 – – 55
Issue of shares 36 – – (36) – –
Employee Share Based
Payment Awards – – – 5,837 – 5,837
Total comprehensive loss for
the period – – – – (5,504) (5,504)
Ordinary dividends paid 3 – – – – (900) (900)
As at 3 April 2022 1,090 – 1 5,801 109,896 116,788
Total comprehensive loss for
the period – – – – (50,133) (50,133)
Employee Share Based
Payment Awards – – – 1,090 – 1,090
Ordinary dividends paid 3 – – – – (272) (272)
As at 2 April 2023 1,090 – 1 6,891 59,491 67,473
Group plc Annual Report and Accounts 2023 157
Financial Statements
Parent Company Financial Statements
Accounting Policies
General Information
Companies Act 2006 (Registration number: 13679248). The registered office is ProCook, 10 St. Modwen Park, Gloucester,
GL10 3EZ.
The principal activity of the Company is that of a holding company. The principal activities of its subsidiaries are set out in
Note 4 to the financial statements.
Basis of preparation
The financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and FRS 102
“The financial reporting standard applicable in the UK and Republic of Ireland” (FRS 102”). In accordance with the exemption
allowed by Section 408(3) of the Companies Act 2006, the Company has not presented its own income statement or
statement of comprehensive income. The financial statements are presented in Pounds Sterling, generally rounded to the
nearest thousand. They are prepared on the historical cost basis, unless otherwise stated.
The directors have, at the time of approving the financial statements, a reasonable expectation that the Company has
adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going
concern basis of accounting in preparing the financial statements.
The principal accounting policies adopted in the preparation of the financial information are set out below. These policies
have been consistently applied to all periods presented, unless otherwise stated.
The Group has taken the following permissible disclosure exemptions under FRS 102:
• Exemption from presenting a Statement of Cash Flow and related notes
• Partial exemption from share-based payment disclosures
• Exemption from disclosing related party transactions entered into between wholly owned subsidiaries
Going concern
In their consideration of going concern of ProCook Group plc , The Board has undertaken a comprehensive review and
assessment of going concern including the Group’s financial projections, debt servicing requirements, available facility
headroom and liquidity, and its principal risks and uncertainties. In the base case scenario, and in the other downside
scenarios which the Directors have reviewed, the Group remains comfortably within its available facility headroom, and
no facility covenants would be breached. However, the Directors recognise that under the severe but plausible downside
scenario, the Group is likely to breach its fixed charge covenant, unless mitigating actions can be applied sufficiently in
advance to prevent such a breach, requiring agreement of a covenant waiver, new banking terms, or alternative funding
arrangements, none of which can be guaranteed. The Directors therefore acknowledge that this potential breach represents
a material uncertainty which may cast significant doubt on the Group’s ability to continue as a going concern.
The Board considers the likelihood of such a severe downside scenario materialising to be low and recognises the range of
mitigating actions available to the Group to prevent such a breach occurring, and the positive and long-standing relationship
which the Group has with its banking partner HSBC. The Directors therefore have a reasonable expectation that the Group
has adequate resources to continue in operational existence and meet its liabilities as they fall due over the period of at least
12 months from the date of approving these financial statements. Accordingly, the financial statements have been prepared
under the going concern basis of accounting.
Further information regarding the Directors approach to assessing going concern is set out on pages 126 to 128 of the
consolidated financial statements.
Critical accounting estimates and judgements
The Company makes certain estimates and assumptions regarding the future. Estimates and judgements are continually
evaluated based on historical experience and other factors, including expectations of future events that are believed to be
reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The
estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities within the next financial year are discussed below.
Group plc Annual Report and Accounts 2023158
Judgement – Indicator of impairment (investment in subsidiaries)
The Group has considered indicators of impairment for the investment in subsidiaries which reflect the trading entities of
the Group. Notably the share price declined substantially since the last financial year end, an effect which was particularly
evident after the Group updated the markets on its trading performance and outlook on 10 June 2022 and again on 14
December 2022, and has remained at a similar level since. Given the share price fall, and the lower profitability in the financial
year ended 2 April 2023, the Group has judged there to be an indicator of impairment, and as such a review of the valuation of
the investment in subsidiary has been undertaken.
Estimate: Investment in Subsidiaries
Since the acquisition of ProCook Limited was obtained via a share for share exchange, the cost of the investment was
determined to be the fair value of ProCook Limited. Without external market valuations, business valuations are inherently
estimation and judgement based. The best available internal and market data was used by management to determine the
valuation at that time.
Subsequent to the initial recognition, management has considered indicators of impairment, and has reviewed the valuation
of the investment in subsidiaries. The subsidiaries’ performance and viability is assessed for the entity as a whole. In line with
FRS 102, the management therefore considered the assessment on a single CGU basis as appropriate.
This review has considered the future anticipated financial performance and cash generation of the Group over a forecast
period based on the Group’s five year financial plan and reflecting a terminal growth rate of 2% which we consider to be
cautious and given the Group’s historical growth record and its opportunity for continued growth in the markets in which it
operates.
The forecast reflects revenue and cost growth assumptions in respect of the Group’s Retail and Ecommerce activities, as
well as expected capital investments and net working capital requirements. The assessment approach considered value in
use, by way of a discounted cash flow methodology and was compared to EV/ EBITDA multiple valuations.
The revised carrying value of the investment is £69.1m which reflects an impairment charge of £48.2m. The sensitivity of
the valuation estimates is such that a 5% compound reduction in projected revenue growth in each year of the assessment
period (53% reduction in projected revenue growth over five years) would result in a £11.7m reduction in the value of the
Investment in Subsidiaries held on the Statement of Financial Position. A one percentage point increase in the weighted
average cost of capital which has been applied would result in a £7.2m reduction in the value of the Investment in Subsidiaries
held on the Statement of Financial Position. Further detail on investment in subsidiaries can be found in note 4.
Expenses
Share-based payments
The Company operates a number of shared based compensation plans which are all equity settled, in exchange for services
received from employees. The fair value of these compensation plans is calculated at the grant date using the Black-
Scholes model. The resulting cost is expensed to the Income Statement over the vesting period. The value of the expense
is adjusted to reflect expected and actual levels of vesting, considering any performance conditions which may apply to
individual plans.
Social security contributions payable in connection with the grant of the share options are considered an integral part of the
grant itself and the expense will be treated as a cash-settled transaction.
Employee benefits
The costs of short-term employee benefits are recognised as an expense in the Income Statement as incurred. The cost of
any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the Company is demonstrably committed to
terminate the employment of an employee or to provide termination benefits.
Pensions
The Company operates a defined contribution pension scheme using an external pensions partner. Contributions to the
scheme are expensed to the Income Statement in the period to which the contributions relate. The assets of the scheme are
held separately from those of the Company.
There have been no significant changes during the period relating to the current scheme, nor its membership and terms and
conditions.
Group plc Annual Report and Accounts 2023 159
Financial Statements
Current and deferred taxation
Taxation, comprising current and deferred taxation, is recognised in the Income Statement, except where a charge
attributable to an item of income or expense recognised as other comprehensive income or to an item recognised directly in
equity is also recognised in other comprehensive income or directly in equity, respectively.
Current tax on profits or losses for the period, is calculated based on tax rates and laws that have been enacted or
substantively enacted by the reporting date in the UK where the Company operates and generates taxable income.
Deferred tax balances in the Statement of Financial Position are recognised in respect of all timing differences that have
originated but not reversed by the balance sheet date, except where:
• The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the
reversal of deferred tax liabilities or other future taxable profits; and
• Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations,
when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions
available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed
for tax. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the
reporting date.
Where applicable the Company makes claims for Research and Development (R&D) tax reliefs in accordance with the
Research and Development Expenditure Credit (RDEC) scheme. Qualifying projects are assessed to ensure the claims made
fit the criteria and definitions set out by the UK HM Revenue and Customs. R&D tax relief claims are recognised in the tax
expense line of the Income Statement.
Dividends
Ordinary dividends proposed by the Board of Directors are only recognised in the financial statements when they have been
approved by the shareholders, and the Company is obliged to make payment.
Investment in subsidiaries
Investment in subsidiaries are recognised at cost less accumulated impairments. During the previous year, the cost of
the acquisition of the ProCook Limited Group was recognised at the fair value of the shares issued in the share for share
exchange, over the nominal value of the shares, as required under Section 612 of the Companies Act 2006. During each
subsequent reporting period an impairment assessment is undertaken to ensure the valuation remains appropriate. All
impairment losses will reduce the carrying value of the investment and be charged to the Income statement during the year
in which the impairment is recognised.
Trade and other receivables
Trade and other receivables are initially measured at the transaction price less transaction costs and are subsequently
carried at amortised cost using the effective interest method.
The Company assesses impairment of trade receivables on a collective basis as they possess shared credit risk
characteristics based on grouping debt by days overdue. The Company also considers the potential for default or any
other failure to make payment to the Company. Trade and other receivables are only derecognised when the right to the
contractual cash flows from the asset expire or are settled.
Trade and other payables
Trade and other payables are initially recognised at the transaction price and are subsequently carried at amortised cost.
They are recognised as current liabilities if payment is due within 12 months. Otherwise, they are recognised as non-current.
Share Capital
Changes in the share capital structure are recognised within equity on the Statement of Financial Position, within any
excess over the nominal share price being recognised within the share premium reserve. Where the Company purchases
its own equity share capital (treasury shares) the consideration paid, including any directly attributable incremental costs,
is deducted from the equity attributable to the Company’s equity holders until the shares are cancelled or reissued. Where
such shares are subsequently sold or reissued, any consideration received net of any directly attributable incremental
transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.
Parent Company Financial Statements
Accounting Policies
Continued
Group plc Annual Report and Accounts 2023160
Notes to the Parent Company Financial Statements
1. Employee numbers and costs
The Company’s employees are the Chairman, two Non-Executive directors and two Executive directors (the Group Board).
Full details of the Directors’ remuneration and interests are set out in the Remuneration Report on pages 94 to 107.
Share-based payments details are given in note 8.
The Company operates a defined contribution retirement benefit scheme for all qualifying employees. The scheme is
administered and managed by a separate third-party specialist pension scheme provider. The total expense recognised in
the Income Statement for the 52 weeks ended 2 April 2023 was £16k (3 April 2022 £2k) representing contributions payable to
these plans by the Company at rates specified in the rules of the plans.
2. Auditors Remuneration
£’000
52 weeks
ended
2 April 2023
23 weeks
ended
3 April 2022
Fee payable for the audit of the Company’s financial statements 8 8
Total audit remuneration 8 8
3. Dividends
£’000
52 weeks
ended
2 April 2023
Dividend
per share
(pence)
52 weeks
ended
3 April 2022
Dividend
pershare
(pence)
Final dividend for the period ended 4 April 2021 – – 1,000 1.0 pence
Interim dividend for the period ended 3 April 2022 – – 900 1.0 pence
Final dividend for the period ended 3 April 2022 272 0.9 pence – –
Interim dividend for the period ended 2 April 2023 – – – –
The FY22 final dividend of £1.0m was declared representing 0.9 pence per share, however £0.7m of this dividend was
waived by certain shareholders. The final dividend was paid to the shareholders on the register at close of business on 2
September 2022.
The FY22 interim dividend of £1.0m was declared and paid representing 1.0 pence per ordinary share, however £0.1m of this
dividend was waived by certain shareholders.
4. Investment in subsidiaries
ProCook Group plc owns 100% of the shares in ProCook Limited. Management determined the valuation of ProCook
Limited at the acquisition date and has performed an impairment assessment at the reported date further details of which
are set out in the above “critical accounting estimates and judgements”. An impairment of £48.2m was identified on the
original valuation of £117.3m.
ProCook Group plc substantially owns directly or indirectly the whole of the issued and fully paid ordinary share capital of its
subsidiary undertakings. The subsidiary undertakings of ProCook Group plc are presented below:
Subsidiary undertaking
% of
ordinary
shares held Principal activity
ProCook Limited 100% Retail of kitchenware
ProCook (Kitchens) Limited
3
100%
1
Property holding company
ProCook (Steamer Trading) Limited
3
100%
1
Property holding company
ProCook B.V (Registered in The Netherlands)
1
100%
1
Retail of kitchenware
2
1
Share capital held by subsidiary undertaking
2
ProCook B.V. is not yet trading.
3
The group will be applying audit exemptions to both ProCook (Kitchens) Limited and ProCook (Steamer Trading) Limited
Group plc Annual Report and Accounts 2023 161
Financial Statements
Notes to the Parent Company Financial Statements
Continued
4. Investment in subsidiaries
continued
For the year ended 2 April 2023, ProCook (Kitchens) Limited (company number 11816559) and ProCook (Steamer Trading)
Limited (company number 11749708) have taken advantage of s479A-479C of the Companies Act 2006 (Act) which allows
companies to claim exemption from audit. The ultimate parent company, ProCook Group plc guarantees all outstanding
liabilities to which the subsidiary companies are subject at the end of the financial year to which the guarantee relates, until
they are satisfied in full.
ProCook Group plc, the Company, and its subsidiaries (excluding ProCook B.V) are incorporated and domiciled in the UK.
The registered office is ProCook, 10 St. Modwen Park, Gloucester, GL10 3EZ.
ProCook B.V., incorporated in the Netherlands, has a registered office at Veerpolder 1-B, 2361KV, Warmond, TheNetherlands.
5. Other receivables
£’000
As at 2 April
2023
As at 3 April
2022
Other receivables 159 104
Prepayments 10 7
Total 169 111
All receivables are due within one year from the end of the reporting period. No impairment was incurred on trade receivables
during the period. No material amounts are overdue.
6. Trade and other payables
£’000
As at 2 April
2023
As at 3 April
2022
Amounts falling due within one year:
Accruals 512 97
Amounts owed to group undertakings 2,742 1,273
Total 3,254 1,370
£’000
As at 2 April
2023
As at 3 April
2022
Amounts falling due after one year:
Accruals 749 816
Total 749 816
The Directors consider that the carrying value of trade and other payables approximates to their fair value. Trade payables
are non-interest bearing and are normally settled monthly.
7. Share Capital and Reserves
£
As at 2 April
2023
As at 3 April
2022
Allotted, called up and fully paid
108,956,624 Ordinary Shares of 1p each 1,089,566 1,089,566
Total 1,089,566 1,089,566
Only one class of shares have been issued which have full voting, dividend, and capital distribution rights.
Reserves
The following describes the nature and purpose of each reserve within equity:
Share premium account: Proceeds received in excess of the nominal value of shares issued, net of any transaction costs
Share option reserve: Recognises the value of equity-settled share-based payments expenses. See note 8 below and note
27 in the Group’s consolidated financial statements for further details on share-based payment plans.
Retained earnings: All other accumulated net gains and losses and transactions with shareholders not recognised elsewhere.
Group plc Annual Report and Accounts 2023162
8. Share based payments
The Company operates several equity-settled share based remuneration schemes for employees. The vesting date for each
scheme is the last day of the contractual life of the scheme. The terms and conditions of the grants are detailed below:
Date of grant Share Scheme
No. of
options
Exercise
price
(pence)
Vest
conditions Vest Date
12-Nov-21 Leadership IPO Award 3,173,876 0 No 12 November 2021
12-Nov-21 Employee IPO Award 1
1
1,198,688 44 Yes 12 November 2023
12-Nov-21 Employee IPO Award 2
1
1,198,688 29 Yes 12 November 2023
12-Nov-21 Employee IPO Award 3
1
1,198,688 15 Yes 12 November 2024
12-Nov-21 Executive IPO Award 1
1
172,413 0 Yes 12 November 2024
12-Nov-21 Executive IPO Award 2
1
689,655 145 Yes 12 November 2024
12-Nov-21 Leadership ESP Award FY22 706,896 0 Yes 12 November 2024
10-Jan-22 SAYE FY22
1
435,255 112 Yes 12 November 2024
08-Aug-22 Leadership ESP Award FY23
2
2,618,481 0 Yes 8 August 2025
17-Feb-23 SAYE FY23
1
1,330,364 27 Yes 17 February 2026
Total 12,723,004
1
There are no performance conditions attached to these schemes, except that the employee is required to be in employment with ProCook Group
plc on the vest date.
2
The performance conditions for this scheme are set out within the Annual Report on Remuneration on page 104.
Fair Value Calculations
The fair value of all share options granted are calculated at the date of grant using a Black-Scholes option pricing model.
Further detail is provided on pages 152 to 154.
An expense of £1.0m has been recognised in the Income Statement during the period in respect of the share schemes in
place, with a corresponding entry in the share option reserve.
Details of the number of share options granted, exercised, lapsed and outstanding at the end of each period as well as the
weighted average exercise prices in £ (“WAEP”) are as follows.
As at 2 April As at 3 April
2023 WAEP (£) 2022 WAEP (£)
Outstanding at beginning of period 8,774,159 0.29 858 141.5
Granted during the period 3,948,845 0.09 8,774,159 0.29
Forfeited/lapsed during the period – (858) (142)
Exercised during the period – – –
Outstanding at period end 12,723,004 0.23 8,774,159 0.29
Exercisable at end of period – – – –
9. Contingent liabilities
The Group had no contingent liabilities at the year-end date (2022: none).
Group plc Annual Report and Accounts 2023 163
Financial Statements
Alternative Performance Measures (APMs)
The Group monitors a range of measures to track financial and operational performance.
These include alternative performance measures which may not be defined in accordance with
statutory measures (IFRS) and are therefore prone to varying calculations and as such may not
be comparable between different companies, although they may be similarly titled.
The Group considers these alternative performance measures to be helpful in providing stakeholders with additional
information on the performance of the business, although recognises that they should not be considered a substitute for, or
superior to, IFRS measures.
To support the understanding of these APMs, details and definitions of the Group’s measures are provided as follows:
APM Rationale
Closest
equivalent
IFRS
measure
Reconciliation
to IFRS
measure Definition and reconciliation
Like-for-like
(“LFL”) revenue
growth %
Provides an
understanding of
the performance
of the existing
and continuing
business on a
consistent basis
year on year
before the effect
of new store
or ecommerce
launches
Movement in
revenue year
on year in the
Consolidated
Income
Statement
Revenue from
non like-for-
like stores and
ecommerce
channels
LFL revenue growth % is a revenue performance measure which
reflects:
• Retail YoY: Continuing Retail stores which were trading
for at least one full financial year prior to the 3 April 2022,
inclusive of any stores which may have moved location
or increased/ decreased footprint within a given retail
centre.
• Retail Yo3Y: Continuing Retail stores which were trading for
at least one full financial year prior to the 29 March 2020,
inclusive of any stores which may have moved location or
increased/ decreased footprint within a given retail centre.
• Ecommerce YoY and Yo3Y: ProCook direct website
channel only.
Year on Year
FY23
£’000
FY22
£’000 Var %
LFL Revenue
3
54,118 60,584 (10.7%)
LFL Ecommerce
3
24,872 27,945 (11.0%)
LFL Retail
3
29,246 32,639 (10.4%)
Non LFL Revenue 8,222 8,570
Non LFL Ecommerce
3
781 4,387
Non LFL Retail
3
7,441 4,183
Total Revenue 62,340 69,154 (9.9%)
Total Ecommerce
3
25,653 32,332 (20.7%)
Total Retail
3
36,687 36,822 (0.4%)
Year on 3 Year
FY23
£’000
FY20
£’000 Var %
LFL Revenue 44,566 21,004 112.2%
LFL Ecommerce 24,872 8,086 207.6%
LFL Retail 19,694 12,918 52.5%
Non LFL Revenue 17,774 17,951
Non LFL Ecommerce
3
781 6,398
Non LFL Retail
3
16,993 11,553
Total Revenue 62,340 38,955 60.0%
Total Ecommerce
3
25,653 14,484 77.1%
Total Retail
3
36,687 24,471 49.9%
Group plc Annual Report and Accounts 2023164
APM Rationale
Closest
equivalent
IFRS
measure
Reconciliation
to IFRS
measure Definition and reconciliation
Gross Margin % This measures
our success in
sourcing high
quality products
which offer
customers great
value, while still
achieving strong
gross margins
to support our
business model.
Gross profit Not applicable Gross profit presented as a percentage of revenue.
Gross profit represents revenue less cost of goods sold inclusive
of costs incurred to get inventory to its final selling location and
condition.
£’000 / % FY23 FY22
Revenue 62,340 69,154
Gross Profit 38,346 45,043
Gross Margin % 61.5% 65.1%
Non-underlying
items
Excluding these
items from
profit measures
provides readers
helpful additional
information about
the underlying
performance
of the Group,
consistent with
how performance
is planned, and
reported to
the Board.
None See Note
3 in the
consolidated
financial
statements
Non-underlying items are defined as transactions that, in the
opinion of the Directors, should be disclosed separately from the
reported Consolidated Income Statement in order to provide a
consistent and comparable view of the underlying performance of
the Group. This will include those items that relate to non-recurring
events and are material in nature and which have been incurred
outside of the normal business operations, including but not limited
to restructuring and fund-raising activities.
Underlying
operating profit
Underlying
profit
before tax
Underlying
profit after tax
The Group
consider these
to be important
measures of profit
performance,
helpful to the
readers, and
consistent with
how Group
performance
is planned and
reported to
the Board.
Operating
profit
Profit before
tax
Profit after
tax
Non-
underlying
items (see
note 3 in the
consolidated
financial
statements)
Statutory IFRS profit measures before the impact of non-
underlying items. Treatment is consistent between financial
periods.
Effective
tax rate
This measure
is useful to
understand the
tax expense
recognised
in the Income
Statement
compared to the
headline tax rate
in force for the
financial year.
None Not applicable Tax expense in the Consolidated Income Statement taken as a
percentage of profit before tax.
£’000 / % FY23 FY22
Underlying (loss) / profit
before tax (164) 9,494
Tax credit/ (expense) 29 (1,900)
Effective tax rate % 17.6% 20.0%
Net capital
expenditure
This measure is
useful to highlight
the net cash
investment made
by the Group
in long- term
assets which will
provide economic
benefits over a
longer time frame.
Net cash
used in
investing
activities
See
Consolidated
statement of
cash flows
Calculated as capital expenditure in respect of purchases of
Property, Plant and Equipment, Intangible assets, and costs
associated with lease arrangements, less proceeds from sale of
fixed assets.
£’000 FY23 FY22
Purchase of property, plant, and
equipment 4,928 3,165
Purchase of intangible assets – 348
Lease inception costs 460 248
Lease incentives received (203) –
Net capital expenditure 5,185 3,761
Group plc Annual Report and Accounts 2023 165
Financial Statements
Alternative Performance Measures (APMs)
APM Rationale
Closest
equivalent
IFRS
measure
Reconciliation
to IFRS
measure Definition and reconciliation
Free
cash flow
This measure is useful to
understand the level of free
cash generated which could be
retained for future investment
by the business, utilised to
repay any debt or distributed
to shareholders.
Net
movement
in cash
and cash
equivalents
See
CFO’s report
Net (decrease)/increase in cash and cash equivalents
before dividend payments, proceeds from the issue of
shares, and proceeds/ (repayments) from borrowings.
£m FY23 FY22
Net decrease in cash and cash
equivalents (1.8) (2.1)
Add back dividends paid 0.3 1.9
Add back change in borrowings 1.0 (2.7)
Add back proceeds from the issue
of shares – (0.1)
Free Cash Flow (0.5) (3.0)
Net
cash/ (debt)
This measure is useful to
understand the financial
stability of the business and as
an indicator of leverage.
None Not applicable Net cash/ (debt) comprises of cash and cash equivalents
less borrowings. This definition of net cash/ (debt) does
not include lease liabilities, derivatives or any contingent
consideration which may be conditional upon future
events which are not yet certain at the year- end date.
£’000 FY23 FY22
Cash and cash equivalents 1,962 3,782
Borrowings (4,716) (5,540)
Net debt (2,754) (1,758)
12 month
repeat rate %
This measure is useful to
understand the Group’s ability
to retain customers and as an
indicator of the Group’s ability
to increase the life time value
of customers.
None Not applicable The 12 month repeat rate reflects the percentage of new
customers who first purchased from the Group in the
preceding financial year, who have made at least one
subsequent purchase in the 12 months since their first
purchase.
Number
of active
customers
This measure of the Group’s
active customer database
is useful as an indicator of
continued penetration into
the markets we operate in.
This database allows ProCook
to understand shopping
behaviours and better target
marketing activities.
None Not applicable Active customers are those that have completed at least
1 purchase during the last 12 months and whose customer
details are recorded on our customer database.
Group plc Annual Report and Accounts 2023166
The production of this report supports the work of the Woodland
Trust, the UK’s leading woodland conservation charity. Each
tree planted will grow into a vital carbon store, helping to reduce
environmental impact as well as creating natural havens for wildlife
and people.
ProCook Group plc (registered office)
ProCook
10 St. Modwen Park
Gloucester
GL10 3EZ
Email: investor.relations@procook.co.uk
Tel: 0330 100 1010
Corporate broker and financial advisor
Peel Hunt LLP
100 Liverpool Street
London
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Leeds
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115 Colmore Row
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Independent Auditor
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M2 3DE
Banking
HSBC UK Bank Plc
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Bristol
BS1 6DZ
Financial Public Relations
MHP Group
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London
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Contacts and Advisors
Group plc Annual Report and Accounts 2023
ProCook
10 St. Modwen Park
Gloucester
GL10 3EZ
procookgroup.co.uk