Up Global Regulatory News (UPGS)

Macroeconomic factors

Macroeconomic trends affecting consumer confidence and reducing non-food spending such as inflationary pressures, higher taxation, and higher interest rates, could affect retail demand.

The Group's international business provides

economic diversity and some protection against a downturn in the UK economy. Despite the challenging market conditions, the Group sees the opportunity to increase its market share by developing new customer relationships, particularly internationally and through online channels. The Group's products, being mass-market and value-led, are well placed in the event of an economic downturn.

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Sourcing

A major loss of continuity in the supply of goods for resale could adversely affect the Group's revenues. Heavy reliance on China as a source of products. Any deterioration in, or changes to political, economic or social conditions in China could disrupt the supply of goods or result in higher product cost prices.

The Group maintains close relationships with

its suppliers through regular factory visits

and interaction with its local teams. Wherever

possible, multiple sources of supply are sourced for major products. The Group closely monitors developments in China and continues to consider and use alternative sources when practicable and viable.

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Supply chain management

Inefficient stock management could result in overstocking, which may adversely affect working capital. Conversely, understocking, could limit the Group's ability to maximise revenue opportunities. Although there has been an abatement in the recent shipping and haulage capacity issues, any return in these issues could affect the availability and the costs of shipping.

Stock levels and purchasing are closely managed, with all purchase orders being reviewed before being placed. The Group's systems facilitate close management of the completion and timing of purchase orders placed. Stock is categorised between 'free' and (pre) 'sold' to ensure that management focus on higher risk items. 'Free' stock is reviewed and prompt actions are taken where necessary. The Group has taken various steps to mitigate the impact of increased shipping

costs and the reduction in shipping capacity,

including prioritising, rationalising and dynamically managing the volume of imported product.

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Margin pressure

A tough retail environment, increased

shipping and road haulage costs and the impact of weakened Sterling could put pressure on gross margin.

The Group's strategy of international growth,

expansion of online channels and increased

penetration of supermarkets continues to provide greater diversity and a balanced-margin portfolio. The Group also employs a combination of margin-enhancing initiatives including monitoring profitability of individual product lines, continued product innovation and refreshing product ranges, balanced against the need to ensure that our products remain competitive. Furthermore, the Group seeks to constantly develop and implement

productivity improvements. The Group actively manages foreign exchange risk through use of forward contracts.

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Protection of brands

Failure to develop and enhance the product range of our brands could result in loss of our competitive advantage, which could impact on the Group's turnover. Failure to develop

or acquire new brands could restrict growth, given the Group's brand-led strategy. Failure to renew or delays in renewing licences for key brands could impact turnover.

A high level of new product development focus is maintained and monitored by the Board. Buying teams attend trade shows and carry out store and factory visits to ensure that they are in touch with the latest consumer demands and trends. The Group continues to develop a "second tier" of brands and monitors opportunities to acquire new brands. The risk arising from the non-renewal of licences has reduced significantly as a result of the Group's acquisition of the Salter brand. FY 22 sales under other licences amounted to 13.1%. The risk in relation to these other licences is mitigated by maintaining strong revenues to and good working relationships with licensors. Post year end the Group renewed its trademark licence agreement with Spectrum Brands, which grants the Group an exclusive licence to use the "Russell Hobbs" trademark for non-electrical kitchen and laundry products.

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Climate Change & Environmental

Climate change is a widely acknowledged global emergency, with the need to act faster becoming evident. Managing the greenhouse gas emissions associated with our supply chain is critical to reducing our impact on climate change. The physical and financial impacts of climate change are already being felt and are set to intensify.

We have established a Group-wide ESG

Committee to extend oversight and governance for monitoring the delivery of the Group's climate commitments. We have stated a strong commitment to be net zero by 2050. This pledge is in the process of being supported by road maps and targeted decarbonisation plans. We are working internally and with third-party organisations to developing this suite of metrics to enable us to monitor progress. We also continue to report our climate-related financial disclosures (see TCFD section on pages 26 to 28).

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Legal and regulatory

Failure to comply with legal and regulatory requirements, including environmental and climate change developments, both in the UK and in other countries in which the Group operates, could result in fines or adverse impact on the Group's reputation.

The Board monitors the changing landscape of

laws and regulations. New legal and regulatory

requirements are discussed by the Audit and Risk Committee whose members contribute insight and experience of such matters. External technical and consulting expertise is sought when required. The Group has procedures for ensuring ongoing compliance with legal obligations, including external annual audits, and runs a programme of new-starter/refresher annual training.

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Humanresources

Failure to attract and retain high-quality individuals, both in the UK and

internationally, could impact on the delivery of the Group's strategy.

The Group's Graduate Development Scheme,

along with links to local universities, provides a steady inflow of high-quality staff to support the future growth of the Group, whilst the Group's Senior Management Development Programme and its Introduction to Leadership courses aim to create a succession of employees into senior roles. A number of steps are taken to encourage the retention of the employees, including the SAYE and PSP share ownership schemes to incentivise its workforce and to further improve retention.

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