External Risk

Changing fashion trends
Risk description Potential impact Mitigation
The Group may fail to respond in a timely fashion to changes in consumer preferences or additionally, fail to anticipate increased consumer demand for its products. The Group may experience inventory shortages or excesses that could result in lost revenue and customer goodwill. The Group will continue to design new and innovative products, and will ensure a high level of market awareness and understanding of fashion and consumer trends by carrying out market research, visits to trade fairs and product research.

The Group is constantly refreshing and updating its product range and this assists in differentiating the product to meet evolving consumer needs.
The Group bears a risk of unfavourable changes in currency exchanges despite its forward foreign exchange contracts
Risk description Potential impact Mitigation
The Group is potentially vulnerable to adverse movements in exchange rates. It pays for a large proportion of its goods and receives a proportion of its revenues in foreign currency. The Group’s operating results become unpredictable due to changes in exchange rates that are outside our control. The Group has a documented foreign exchange policy and maintains constant management oversight, including monthly Board review of foreign exchange exposure and opportunities. The Group’s policy is to hedge these risks by using forward foreign exchange contracts.