Bestseller A/S

Ledelsesberetning

Adapting to new demands — in our business and beyondIn 2023-24, we faced headwinds, but found solid ground in our unwavering commitment to transform our business and bring fashion forward. While navigating a challenging market and balancing the juxtaposition of growth and sustainability, we remained determined to invest in our business and beyond. INTEGRATED REPORTINGThis report presents BESTSELLER’s financial and sustainability perfor-mance, investments, risks, strategy, and governance for the financial year 1 August 2023 to 31 July 2024. All financial figures are from the re-ported financial year unless otherwise specified. The sustainability statement includes reporting in accordance with section 99a, 99b, and 99d of the Danish Finan-cial Statements Act. We are striving to fully integrate the reporting of all sustainability data with financial data in the same re-porting period in the future. This will provide a comprehensive view of our performance and progress across both dimensions. Through this integrated reporting approach, we aim to demonstrate the interconnectedness of our financial and sustainability goals and our com-mitment to creating long-term value for our stakeholders. InnovationWe collaborated with innovators and launched capsule collections made with new materials. Read more on page 86 and 156.Supply chainWe introduced a collaborative initiative to financially empower suppliers to reduce their carbon footprint. Read more on page 82.Organic cottonWe increased our commitment to a transparent and fair cotton production through the direct-to-farm programme. Read more on page 88 and 160.Letter from our CEO & OwnerAt BESTSELLER, we continuously invest in our business and beyond. Even in a challenging market, we remain steadfast in our commitment to serving our partners and customers and bringing fashion forward.In 2023-24, we set out to reach new milestones, grow our company, and surpass last year’s results. Mindful of our heritage and founding principles, this is our aim every year, as we know our results are profoundly linked to our obligation to leave a positive im-pact on the world around us and to generate economic contribution which can benefit countries we operate in.While doing our best to fulfill this aspiration, we witnessed the impact of macroeconomic challenges along the way. As expected, persistent inflation and geopolitical uncertainties affected the market and caused a tough year for the fashion industry. These challenges also affected us, ulti-mately resulting in a turnover slightly below our ambition. Despite this, we managed to adapt to a new market and new demands, not least thanks to valued partnerships and skilled colleagues. As a result, profitability increased by 8 percent for this financial year. This achievement is a testament to the hard work and eagerness to innovate and invest that characterise the spirit of BESTSELLER, perhaps more than ever when we are facing headwinds. Continuous investments – throughout the ebb and flow of business – play an important role in honouring the re-sponsibility we carry for our company and the world we are a part of. Without hesitation, and with BEST-SELLER’s persistent determination, we have invested in new markets and new retail stores as well as new technology throughout our value chain. Furthermore, we have invested in efforts to reduce our environmen-tal footprint. Balancing growth with sustainability is one of the biggest challenges we face as a fashion com-pany. But it is also a challenge we face head-on with determination, transpar-ency, and cautious optimism. To motivate and accelerate our com-mitment towards reaching our targets, we will launch sustainability incen-tives for all colleagues in 2025. As BESTSELLER approaches its 50th anniversary next year, I am humbled by what we have achieved this year and in the years that came before it. Through our commitment to investing and bringing fashion forward, we are casting the foundation for the next 50 years. Anders Holch PovlsenCEO & OwnerJoint letter from our CFO & Head of SustainabilityDelivering results in a challenging market should not be underestimated. Nonetheless, true commer-cial success must be aligned with the ability to operate within the limits of the planet's resources and boundaries. While we have made progress, there is still a significant journey ahead. In this report, we outline the goals we must achieve to reach our ambitions. Considering the difficult market con-ditions and a changing fashion land-scape, we delivered reasonable com-mercial results for our financial year from 1 August 2023 to 31 July 2024. Top-line revenue fell by 4 percent, to DKK 35.6 billion, driven by conservative order patterns from online wholesale partners and a slight decrease in sales on our own online channels. In contrast, the multichannel retail nature of our business showed its strength, with top-line revenue from physical wholesale partners and par-ticularly from our 2,800 branded retail stores continuing to grow in line with recent years. Despite pressure on top-line revenue, our bottom-line profitability improved. This was primarily due to higher on-line sell-through, lower stock levels, and efficiency gains, especially in our logistics operations. As a result, profit-ability increased 8 percent to a total of DKK 5.3 billion. We anticipate the global uncertainty to continue into the current financial year, 2024-25, and expect revenue to remain stable and profit ranging be-tween DKK 5 and 6 billion. The ability to deliver results under difficult circumstances allows us to continue to invest in an even stronger commercial foundation and in bring-ing fashion forward. Our results are undoubtedly linked to our abilities to deliver on our broader ambitions and responsibility. Therefore, it is essential to invest in and elevate both, as they are deeply interconnected, forming the core of our overarching goal. In the coming years, we intend to do exactly this. The dilemma facing our industryAs with every company, our commer-cial success must go hand-in-hand with our broader responsibilities as part of an industry that operates with respect for human rights and within planetary boundaries. Dorte Rye OlsenHead of SustainabilityThomas Børglum JensenChief Financial OfficerGoing forward, we will amplify our ef-forts and collaboration with custom-ers, suppliers, consumers, and peers to address the ever-present dilemma facing our industry and all industries working in consumer goods. That is, delivering the right products, which provide the right value at the right time to consumers. All while simulta-neously addressing the environmen-tal and social impact of our business across the value chain. This report marks the second year we have consolidated our financial, so-cial, and environmental performance into a single, unified narrative, and we continue to further integrate our reporting. In 2023-24, we communicate for the first time the amount of greenhouse gas emissions from our value chain linked to the financial year. The data shows we are beginning to see a de-coupling of emissions compared to our commercial growth, a result largely driven by increased investments in preferred materials that have a lower environmental impact compared to conventional options. As knowledge evolves Collaborative solutions are crucial to achieving scale and transitioning to a circular future. Thomas Børglum JensenChief Financial Officer, BESTSELLER Dorte Rye OlsenHead of Sustainability, BESTSELLER A year of investing to make the biggest impact While we are happy to see progress, we recognise that there is a long way to go to reach our sustainability ambitions. To succeed, we have, and will continue to increase our investments in three key areas: — Increasing the volume of preferred and next generation material in our products. These are materials with a lower environmental impact compared to conventional materials. In 2023-24, we increased the volume of recycled polyes-ter, doubled the amount of organic cotton sourced directly from farmers, and committed to increasing the volume sourced by another 50 percent in 2024-25. — Collaborating holistically with partners to decarbonise the global supply chain. This means working directly with suppliers to reduce their environmental impact and collaborating with peers to achieve scale at a faster pace. In 2023-24, we committed to investing in the Future Supplier Initiative. This initiative brings together major industry peers to provide financial support for garment producers and material manufacturers, helping them reduce their environmental footprint. Additionally, we made our biggest ever sustainability pledge for a renewable energy project in our supply chain. — Extending the lifecycle of our products to prepare for a circular future. This starts with improving product quality and durability. It also means working to-gether with partners across the industry to advocate for solutions that promote reuse and recycling, and engaging with consumers to raise awareness about their impact and providing solutions to promote recycling. In 2023-24, we launched our first online recommerce platform to enable product reselling. Now for the hard part Since the launch of our Fashion FWD sustainability strategy, we have made mean-ingful progress, and we remain committed to reaching our targets. Whenever we reach our goals, we will assess our progress and set new objectives. Similarly, we will introduce new, specific ambitions related to biodiversity, water, and land use, as these are areas with a profound impact on the health of our planet. Some of our targets set in 2018 were to be achieved between 2025 and 2030. We are more than aware that some will be challenging to achieve within the indicated timeframe. Here, we will not make any excuses. Instead, we will do our best to improve and increase our efforts, as we know that the long-term success of our business hinges upon achieving financial, societal, and environmental goals. Through collaborative efforts among customers, industry peers, suppliers, policy makers, and other stakeholders, we can collectively prepare the fashion industry for a circular future, which respects planetary boundaries. This is our unwavering commitment. HighlightsSupplier sustainability progress —We placed 78 percent of product orders with suppliers rated highly in our eval-uation of environmental and human rights management. This result sur-passes our 2025 goal of 75 percent. Organic cotton—The total amount of organic cotton used in products nearly doubled, rising from 11 percent in 2022-23 to 21 percent in 2023-24. FWD>>ENV programme —30 key suppliers in Bangladesh en-rolled in the programme reported av-erage annual savings of energy (7%) and water consumption (12%), reduc-ing CO2 emissions by 29,000 tonnes. Reduced electricity consumption in retail —Two years ahead of the projected time-line, we succesfully reduced our stores’ electricity consumption per square metre by 30 percent since 2018, largely due to low-wattage LED lighting.Retail performance—From a growth perspective, retail once again stood out in our total business. Sales in retail stores increase by over 5 percent.The Gender Diversity Pledge—We signed The Gender Diversity Pledge created by the Confederation of Dan-ish Industry to support our mission of promoting diversity, equity, and inclu-sion across our company. Climate emissions —We began to see a decoupling of green-house gas emissions from our growth, primarily driven by investments in low impact materials. New brands —We launched two new brands, ANNARR and JJ Rebel, each catering to different menswear segments, providing new and distinctive style options for to-day’s shoppers. International Accord extension —We joined leading fashion brands in extending the International Accord for Health and Safety in the Textile and Garment Industry in Pakistan and Bangladesh for six more years. This year, we celebrated 25 years of BESTSELLER Austria with a party for colleagues and partners in Vienna. National Olympic partnership —During Paris 2024, we proudly dressed the Danish Olympic and Paralympic athletes for the fifth consecutive time. The collection was designed and de-livered by JACK & JONES and VERO MODA.Investing in the future of our suppliers —In collaboration with leading fashion companies and industry organisations, we launched the Future Supplier Initia-tive to financially empower suppliers to reduce their carbon footprint. Economic contribution We strive to generate value in the countries and regions where we do business. One of the ways we do this is through tax payments, commercial relations, and other economic contributions. TOTAL TAX CONTRIBUTIONOur business model is based on buying and selling fashion. In addition to taxes on profit of the companies across BESTSELLER, our total tax contribution also includes additional value we generate for societies indirectly. These include, among others, the value added taxes and taxes paid on salaries by our 22,000 colleagues, as well as customs duties and property taxes.Each year, BESTSELLER discloses our total tax contribution, aiming to provide an overview of our total economic contribution to public finances as generated during our financial year. Taxes Borne: include corporate taxes, customes duties and other taxes levied on BESTSELLER such as property taxes. The total amount of taxes borne is 1,968 mDKK.Taxes Collected: include Indirect taxes such as VAT, GST, and Sales Taxes, as well as payroll taxes. The total amount of taxes collected is 6,524 mDKK.8,493Total tax contribution (mDKK)OUR TOTAL TAX CONTRIBUTION CONSISTS OF THE FOLLOWING CATEGORIES:194 mDKKOTHER TAXES Include, among others, council taxes, prop-erty taxes, lease taxes as well as other taxes which are not included in the above tax categories.4,769 mDKKINDIRECT TAXES Include taxes and duties levied on produc-ing, selling, or using goods and services, and comprise of Value Added Taxes (“VAT”), Goods and Service Tax (“GST”), and Sales taxes.605 mDKKCUSTOMS DUTIES Include all duties levied on goods imported and exported across international borders.EMPLOYEE TAXES1,756 mDKKInclude all taxes and social contributions in relation to the employment of staff. The employee taxes cover the taxes collected by the BESTSELLER Group on behalf of the employees and which are withheld from employee wages and salaries.1,169 mDKKCORPORATE INCOME TAXESInclude all taxes in relation to the compa-nies’ profit and cover both taxes payable on tax settlements and tax assessments in the form of tax pre-payments. No tax provisions or accruals are included.BESTSELLER at a glance It all started in a small store located in Ringkøbing in Denmark.Founded in 1975 by the Holch Povlsen family, BESTSELLER is a global fashion company with a family of brands catering to every demographic. Our commitment to quality and affordability has been a core value throughout our journey from a single store in Denmark to selling products in more than 75 countries globally.Our distribution network spans Europe, Asia, North America, South America, Oceania, and the Middle East. Through our wholesale operations, we collabo-rate with close to 16,000 multi-brand retailers, department stores, and online platforms. Additionally, we operate 2,800 BESTSELLER-branded retail stores, with a presence in 44 countries. Approximately 600 of these stores are run by close partners.We are proud of our dedicated team of 22,000 colleagues. From design and logis-tics to sales and technology, we foster a culture of ambition and value creation for our partners. Our global supply chain includes over 350 suppliers and 700 factories in 18 coun-tries. We prioritise working together with our partners to keep improving manu-facturing practices and empower over 700,000 people across our supply network.TECH & Biggest Digital Main offices Logistics Sourcing Finance hubmarketshub in Denmarkcentres offices SpainGermanyThe NetherlandsBrandeDenmarkChinaFrance AarhusPolandIndiaSpainCopenhagenThe NetherlandsBangladeshItalySpain PakistanThe NetherlandsTürkiyeMyanmarCambodiaOur businessmodelAs a global fashion company, we recognise the importance of strong partnerships throughout our value chain. Our success hinges on being the preferred supplier for our customers and the most valued customer for our suppliers.Through our multi-channel retailing model, we distribute our products through our own retail stores, partner stores, multi-brand retailers, and branded e-com-merce platforms, as well as via online partners. We are dedicated to incorporating sustainability practices into every aspect of our operations, from material sourcing to production, logistics, and promoting reuse and recycling to extend product lifecycles. — MATERIALS — BUYING — LOGISTICS Collaborating with suppliers to in-Evaluating trends, supplier input, and Collaborating with logistics crease the amount of products made successful styles to inform buying partners to transport products with certified and branded materials.decisions.from suppliers to distribution centres.— DESIGN — SALES — MULTICHANNEL Working closely with suppliers on Introducing collections to sales teams Distributing products across retail, trend analysis and style inspiration for engagement with wholesale wholesale, and e-commerce channels.and creating products with and retail partners.circularity in mind.— SHOPPERS — PRODUCTIONEmpowering shoppers with Working with suppliers to manufac-information to make more informed ture styles using defined materials.choices and drive industry progress.A guide to exploring the annual report This integrated report offers a comprehensive overview of our progress and the key investments we have made over the past financial year along with our sustainability progress and financial figures. With each financial year comes new opportunities and new challenges. As a global fashion company, our performance is impacted by external factors, such as macroeconomics, political legislation, and consumer behaviour. But our success is defined by how we adapt to these demands and our ability to turn challenges into opportunities. For this reason, we continuously invest in our business and beyond to ensure sustainable growth today and for years to come. Investments have always been an important part of our company, but this year, perhaps more than ever, has been defined by key investments across our value chain. A YEAR OF INVESTMENTS In the first part of the report, we highlight selected initiatives and results from the year that has passed through case stories from our business. More specifically, we zoom in on Brands & Markets, Technology & Digitalisa-tion, and Planet & People as this trifecta holds defining investments made in a challenging market. Brands & marketsExpanding our global retail footprint and strengthening our brand portfolio. Technology & digitalisationDigitising sales channels and enhancing customer experiences. People & planetOur commitment to sustainability through caring forcolleagues and taking responsibility for our environment and society. SUSTAINABILITY STATEMENT In the second part of the report, we dive deeper into our sustainability progress and challenges by presenting our statutory reporting on corporate responsibility in accordance with the Danish Financial Statements Act §99a. Here we detail our performance, risks, strategy, and governance. In this comprehensive statement, we also introduce our Fashion FWD strategy and describe how we are working to integrate sustainability throughout our business. The overall structure is based on our three main sustainability pillars: ‘Addressing our Environmental Impact’, ‘Preparing for a Circular Future’, and ‘Supporting the People Throughout our Value Chain’. FINANCIAL STATEMENT In the third and final part of the report, we present the consolidated financial statements for the group and parent company. These tables are followed by a management’s statement and an independent auditor’s report. The framework of this year’s annual report is used to facilitate a thorough and methodical way to explore and understand our investments, ambitions, challenges, and results, and how we continuously adapt to new demands in our business and beyond. Brands &amarketsWe are committed to growing our business by investing in new stores, new brands, and new markets – to name a few. In this chapter, we will highlight the key investments we have made in 2023-24 across brands and markets to grow our business through expansion and improved logistics. With an emphasis on the right products and the right locations, we launched several strategic initiatives this financial year. These includes two new brands, expanding to emerging markets, and opening and renovating new offices and new retail stores. Here, we also highlight our investment in a new logistics centre in the Netherlands. Brick-and-mortar leads the way Investing inIn a consecutive financial year, retail was once retail again our fastest-growing sales channel. Led by our two biggest retail brands – ONLY and JACK & JONES – we invested in new stores and grew our revenue by 5 percent.More than 2,800 branded stores in 44 countries make up our retail business. As the public face of many of our brands, these stores are an important part of BESTSELLER – not only due to brand value and financial value but due to the stores’ contribution to thriving city centres as well. In 2023-24, our retail brands grew our presence in the market by investing in new stores and entering new countries. Still, our largest retail markets remain Germany, the Netherlands, and Denmark. 2,80044branded stores countriesONLY – A NEW STORE During this financial year, ONLY STORES delivered retail growth of 18 percent EVERY OTHER DAYand invested considerably in bigger and better stores. The brand opened 180 stores – half of them completely new and half of them expanded or moved to a more suitable location. 30 of the new stores represent ONLY STORES’ entry into three new retail markets: France, Italy, and the Czech Republic. In line with previous successful retail years, ONLY STORES’ retail growth in the financial year 2023-24 is the result of a strategy that targets more square metres on attractive locations with a vast selection of styles. Finn Poulsen “Closing yet another strong retail year for ONLY Brand Director STORES reinforces not only our confidence but ONLY our obligation as a market leader. We will con-tinue to dominate the market – in fact, I believe we have the potential to triple our retail business over the next decade.” Elaborating on this strategy, Finn Poulsen says: “We will continue to grow our retail business by opening stores that offer a unique shopping experience, exceeding customers’ expectations of a regular fashion store. Running hundreds of mega stores all over Europe with new styles arriving frequently requires an impressive setup across the value chain. This is possible at ONLY STORES thanks to skilled colleagues in our offices and in our stores – they truly are the backbone of our company.”ONLYMore square metres in better locations allow ONLY STORES to present a vast style selection for shoppers.JACK & JONES – DIGITISING RETAIL With 135 new and re-opened JACK & JONES stores, 2023-24 has been yet another ALL OVER THE WORLDeventful retail year for our biggest menswear brand. From the first store in Nor-way more than 30 years ago to store number 1,000 opened in Portugal this finan-cial year, investments in expansion have been a constant from the very get-go. The brand has made its retail entry in four new markets – Latvia, Mauritius, Portugal, and Slovenia – cementing the commitment to global growth. Anders Gam “Retail has always been a very important part Brand Director of our business – and with more than 100 store JACK & JONES openings, this year was no exception. New stores and new markets enable us to bring our products closer to shoppers around the world. We are tar-geting global expansion through dedicated team-work and valuable partnerships.”In 2023-24, JACK & JONES also continued its investments in omnichannel to create a seamless connection between retail and e-commerce. Adding to existing digital features such as in-store ordering, the launch of JACK & JONES Club in 11 markets and counting is expected to digitise the retail experience further while increasing basket quantity and strengthening shopper loyalty. Read more about this investment on page 72. When it comes to future investments, Anders Gam shares: “We will not only continue to expand our global retail portfolio, but we will also invest in our first multi-brand concept store with JACK & JONES and JJXX in the heart of London, marking the beginning of our retail journey into women’s fashion.” JACK & JONESThe new 400 m2 JACK & JONES store in Amadora, Portugal, marked the brand’s store number 1,000.JACK & JONESVisual merchandisers like Theresa create captivating displays that contribute to a great retail experience.Targeting new segments Investing inIn 2023-24, our brand portfolio grew as we new brandswelcomed two new brands, each catering to different segments in the menswear market. We continuously invest in brand development to expand our business and meet the demands of today’s shoppers. Our family of more than 20 brands is constantly evolving and adapting to new market trends and customer needs. Ever since the first BESTSELLER womenswear brand was founded nearly 50 years ago, we have invested in brands and sub brands – from menswear to chil-drenswear, to plus size and petite and now, entry-price to premium.20+2brandsnew brandsJJ REBEL – AN ENTRYPRICE Launched with a competitive price strategy, JJ REBEL is the newest addition to BRAND THAT DOES NOT the JACK & JONES brand portfolio. The new brand will offer collections kept COMPROMISE ON QUALITY at a lower price point made possible through a narrow collection structure. By basing the selection of styles on years of industry know-how and collaborat-ing with longstanding suppliers, the brand can cover all categories with few but strong products that maintain the JACK & JONES product quality.Dennis Birk Jørgensen “We have high standards for our qualities at JACK International Sales Director & JONES. JJ REBEL is no exception. We are able to JACK & JONEScreate these entry-price collections due to a deter-mined and focused product strategy – not because we compromise on quality.” ANNARR – A PREMIUM Inspired by the urban cityscape of Copenhagen, this new menswear brand targets BRAND THAT TRANSCENDS the premium fashion market with meticulously crafted staples that appeal to SEASONAL TRENDS high-end shops and key department stores. Innovative fibres, relaxed silhouettes, and inspiration from streetwear are some of the defining characteristics of ANNARR.Per Holk Reinertsen “Even in challenging times and a competitive Brand Managermarket, we are making our entry to meet the ANNARRdemands of a rapidly evolving young generation. They want to dress smarter, wear the best quality in new silhouettes, and combine elements from streetwear with tailoring.” Expanding a region Investing inExpansion was a main headline for BESTSELLER new marketsRegion East this financial year. Investments into new markets in the Middle East and Eastern Europe grew the region’s business to cover more than 30 countries run by five local hubs. LjubljanaThe new regional hub in Ljubljana will serve as a centre for business activities in the South East Subregion.Our products are currently sold in more than 75 countries worldwide. While Germany remains our biggest market, we continuously invest in new emerging markets that hold great potential. These investments cover a wide range of business activities including wholesale and retail business. In 2023-24, BESTSELLER Region East – a business region that covers various markets from Austria and Eastern Europe to the Middle East and North Africa – led the way by launching new offices in Athens, Dubai, Istanbul, and Ljubljana and opening 60 new retail stores across the vast region. Alexander Korosec “While the wholesale business is the backbone of Regional Director our company, the retail business, own stores and BESTSELLER Region East partner stores alike, is the main growth driver. With an estimated potential of 700 stores across the region, we face today’s market complexity head-on by investing in the right markets and the right people.” Localisation is an important factor when expanding a region that covers more than 30 countries. Elaborating on this strategy, Alexander Korosec says: “To realise the full potential of these new markets and keep a competitive edge, localisation is key. That is why we are continuing our growth journey by creating additional local hubs and organisations run by skilled colleagues with an entrepreneurial spirit.”Investing in new markets, especially outside our core business in Western Europe, is not new to this BESTSELLER region. The region includes Türkiye – BESTSELLER’s fastest-growing sales market for the last two years. “With the recent success in Türkiye achieved by our local team, we have seen first-hand what we can create when we invest in markets with great potential. This year, we turned to Balkan and the Middle East to establish new regional hubs in Dubai and Ljubljana – and we are far from done.”Read more about BESTSELLER Türkiye’s 2023-24 results in the next two pages. Growth market of the year – again Investing inIn a consecutive year, Türkiye was once again our new marketsbiggest growth market. Adding to last year’s re-sults, we seized new opportunities and untapped potential in a market with economic volatility. To support the growth of this market, we invested in new warehousing and a new showroom.Emerging markets play an important role in achieving the growth we aim for each year. For this reason, we are continuously improving our products and expanding our business to new countries that match our brand portfolio. Among these promising markets, Türkiye stands out this financial year with a top-line growth of 26 percent – on top of a record year in 2022-23. Eight neigh-bouring countries contribute to this result, as they are all managed from our hub in Istanbul. The country of Türkiye, however, stands for roughly 90 percent of the turnover. Top-line growth of26%Zahit Murat Apaydın “By understanding our customers’ needs and Country Commercial Manager delivering quality products with the right timing BESTSELLER Türkiye and pricing, we have managed to turn the chal-lenges of a developing market into opportunities.” Behind this result lie several strategic investments to support today’s demand and tomorrow’s potential. New dedicated teams for market expansion, relocation to a bigger warehouse, and a new showroom to showcase our brands are among the market’s defining initiatives of the year. Optimising valued partnerships Investing inWe rely on trusted partners throughout the partnershipsentire value chain. In 2023-24, BESTSELLER UK demonstrated the importance of great partner-ships – especially in a challenging market – by investing in a collaborative project with ASOS to optimise and grow our shared business. The UK market is home to one of our biggest cross-border online partners: ASOS. During the financial year 2023-24, we embarked on a joint project to address commercial challenges and improve business excellence. The goal was to improve performance, find efficiencies, improve speed-to-market, and ultimately deliver better sales and profits for both parties. Utilising the trust and respect we have built over the years, we came together to collectively work across departments and functions to review and optimise end-to-end flows covering all aspects including commercial, logistical, and operational processes. Although the project is on-going and holds further potential, the invested time and resources have improved our sell-through rate and impacted this year’s result, closing the ASOS order book at index 110 compared to 2022 -23 – a result that underlines the value of great partnerships and the power of collaboration. Lee Davison “Nearness to our customers has always been a Country Manager cornerstone of our business, perhaps now more BESTSELLER United Kingdom than ever. The market is evolving and changing every day and we need to work in tandem to face any challenges and opportunities together. We will continue to roll out our sales, digital, opera-tional, and logistic optimisation process across our partners to drive further efficiencies. Our ambition is to be closer than ever to our partners and faster to market than our competitors.” New officesInvesting inDuring this financial year, we invested in new new officesoffices and in renovations of current locations to support the needs of our markets and ensure the BESTSELLER identity – no matter where you visit us. MontrealParisAthensIstanbulDubaiWe have offices in more than 30 countries worldwide. These locations are home to thousands of colleagues as well as visiting customers and business partners. Although every location offers something unique, each space is meticulously designed to enhance BESTSELLER’s Nordic look & feel. Birgitte Majlund Mikkelsen “We want our colleagues and customers to feel at Designer home in all BESTSELLER offices around the world. BESTSELLER Identity No two locations are alike, but our identity spans geographical borders thanks to consistent choices in colours, furniture, and decorations. All offices are based on a modern and fashionable design philosophy with emphasis on creating a warm and ambient space for business and relaxing.” In 2023-24, we opened new offices in Athens, Dubai, Paris, and Istanbul and completed an extensive renovation and expansion of our office in Montreal. While some offices represent our entry into a new market, others represent growing markets that need better locations and more space. Entry or existing market, these new BESTSELLER offices are all designed to be long-lasting and flexible for future needs. AthensOur new office in Greece is a piece of modern architecture located in Kifissia, one of the oldest and most beautiful suburbs of Athens.MontrealAn extensive renovation doubled the size of our industrial office space in Montreal, creating more showrooms and inviting natural light inside.ParisThe newly renovated corner building on Rue de Provence in Paris’ 9th arrondissement features a stunning mix of new and preserved materials.Building a new logistics centre Investing inThe Dutch city of Lelystad will be home to this logisticsyear’s biggest investment in logistics: a 155,000 m2 logistics centre with stunning architectural details and cutting-edge technology. When com-pleted, it is expected to be Europe’s largest logis-tics centre made of mass timber. Our logistics centres play a crucial role in getting products to customers at the right time. To support the growth of our brands and optimise lead time, we have signed the papers for a new logistics centre – Logistics Centre West – that will also be our first own-operated warehouse outside Denmark.Allan Kyhe Kjærgaard “Building Logistics Centre West not only Logistics Director strengthens our opportunities for future BESTSELLER growth but also underlines our commitment to reducing the environmental impact of our logistics operations and the continual integration of automation technology to improve our business.” Storage capacity of 1,500,000 cartons50% of the site dedicated to landscape Biodiversity increased by 10%Powered by 23,000 m2 solar panels 600 highly skilled colleagues1,000+ robotsDesigned by renowned architecture studio Henning Larsen, Logistics Centre West will offer around 600 colleagues a positive workspace of natural daylight, green areas, and timber sourced from FSC-approved suppliers. BREEAM is one of the leading international building certifications in sustainable construction, and the new logistics centre is designed to be BREEAM-certified at the highest level due to features like solar panels and landscape areas protecting biodiversity and absorbing CO2. To assist our skilled colleagues and increase efficiency, we will deploy state-of-the-art AI and robotic technology inside the logistics centre. With more than 1,000 robots, the facility is set to become one of Europe’s most highly automated and efficient logistics centres.When it comes to investments that demonstrate our commitment to tech and sustainability, Logistics Centre West was not the only initiative of this financial year. In the following chapters, you can read more about selected investments in these two key areas of our business. Technology & digitalisThrough digital investments, we are transforming our business and equipping ourselves with the technology needed to support our customers with the right products at the right time.Investing in technology is critical to achieve our sustainability ambitions. By optimising our buying and sales processes, we can design closer to season and showcase our styles digitally to minimise the number of samples. At the same time, upgrading our data platforms is essential to create transparency and traceability in our supply chain. In this chapter, we will highlight the key initiatives made in 2023-24 to accel-erate our digital transformation. This includes incorporating new generative artificial intelligence technology throughout our business, while supporting wholesale customers’ transition to digital sales channels. It also encompasses new projects within automatic product replenishment and omnichannel shopping. IntroductionAt BESTSELLER, we navigate digital trends and adapt to new demands through investments in existing solutions and the latest technology to increase effectiveness, strengthen security, and optimise our business throughout the entire value chain. “There is never a dull year in the ever-changing world of technology – and this financial year was no exception. Finalising the implementation of our new retail platform for 2,400 of our stores, building a new wholesale plat-form, strengthening our platform for digital collaboration with our sup-pliers, taking the first steps towards product transparency, automating our logistics and warehouse operations, and initia ting new AI (artificial intel-ligence) projects are among the key tech investments that have defined an eventful year. Naturally, generative AI has played – and continues to play – an important role in our digital journey. We have developed new initiatives to prepare our business for a digital revolution of endless opportunities. By taking our point of departure in every day AI to create a solid foun-dation for game-changing AI, we are slowly but steadily supporting our col-leagues with AI assistance to various extents, ultimately increasing produc-tivity, minimising errors, and bringing new inspiration. It has also been a year of keeping our company safe from cyber threats. Each week, we face attacks on our firewall. For this reason, we continuously invest in dedicated efforts towards disarming this risk through preventive and reac-tive technology. Looking ahead, we know that more opportunities as well as challenges will come. From our TECH hubs in Denmark, Malaga, and Kigali, we keep focusing on our core business to sup-port further growth. By embedding our solutions across the business, we en-sure full value harvesting while keep-ing in mind that the fashion industry is rapidly changing, which will require increased flexibility in our solutions. We are committed to supporting and developing our main activities as well as new emerging markets using our solid solutions, knowledge, and data combined with modern technology and AI. This way, we invest in the digital transformation today to grow our busi-ness tomorrow”. Nicolas Skovmand Chief Information OfficerBESTSELLERDigitising our wholesale business Investing inInvesting in the digitalisation of our sales pro-wholesale cesses drives customer value and strengthens partnerships.Wholesale operations remain a cornerstone of our company, representing over half of our business. The traditional sales cycle in the fashion industry relies on the two main seasonal collections of Spring-Summer and Autumn-Winter. By adopting new technology, we have optimised our sales processes and enhanced customers’ buying experience. By leveraging experience and insights from thousands of data points, we identify top-performing styles and improve the way we present our product offerings to generate greater value for our wholesale partners. In 2023-24, digital sales across all BESTSELLER channels grew by 5 percent. This was mainly due to the continual rollout of new digital technology, training of our colleagues in using digital tools, and the dedication of thousands of sales colleagues working to help customers make the transition to buying digitally. Copenhagen Fashion WeekDigital tools play a big part for most brands when attending fashion fairs. Germany, France, and Spain were the markets with the highest share of digital sales, while we saw significant growth in digital sales across our newer markets in Latin America. The two key channels for digitising the dialogues with our customers are DIRECT and digital showrooms (DSRs). DIRECT B2B PLATFORMDIRECT is our interactive B2B digital sales platform, empowering wholesale customers with self-managed ordering, personalised experiences, real-time product availability, and delivery timelines. The platform provides customers with efficient order planning and forecasting capabilities, streamlining the ordering process, and facilitating in-season collection adjustments.In 2024-25, we will transition customers from DIRECT to our new digital sales platform, MORE. Developed specifically for BESTSELLER, MORE represents the next stage in the digital sales journey, meaning we can develop even more customer centric features and integrate seamlessly into our other digital tools. The transition to MORE will take place market by market and close collaboration between sales colleagues and customers will be the key to success. In this chapter, on page 62, we highlight the work done by colleagues in BESTSELLER France, who led the way with their work supporting customers using DIRECT. DIGITAL SHOWROOMS Digital showrooms utilise touchscreen technology to transform the sales ex-perience. Customers can engage with products interactively, access detailed information, and personalise their shopping journey, streamlining the ordering process and enhancing product discovery.Utilising digital showrooms enables sales teams to present collections using a limited number of physical samples alongside high-resolution images, videos, and 3D models. This approach enhances the customer experience while offering the potential for significant reductions in physical samples, leading to substantial environmental and cost benefits.In 2023-24, we developed new digital tools to enhance the buying experience for our key customers. These included developing a digital merchandise floor, a 3D viewers, and digital catalogues.The merchandise floor provides sales colleagues options to mix and match styles to find the perfect product combination. Being able to present 3D collections means customers can almost feel the textures of the materials, explore details, and immerse themselves in the products.Finally, the new digital catalogues are collaborative platforms for joint interac-tion with customers. We can showcase comprehensive product information, and customers can easily place orders directly through the catalogue.In 2023-24, we expanded our global network of digital showrooms to over 200 across 20 countries, representing a significant increase of more than 40 new installations.Germany was once again the market with the highest volume of sales in digital showrooms, while Denmark and Belgium were the other leading markets.Across the company, sales from digital showrooms increased to DKK 1.2 billion. In this chapter, on page 66, we continue our focus on digital sales in 2023-24 by highlighting the work done by colleagues at VERO MODA, inspiring customers using digital showrooms. 20Countries200+ShowroomsDigitising sales globallyTouchscreen technology in showrooms across 20 countries enables colleagues to offer our customers an interactive experience.Frederik Leerskov Bugslag “By continuing to digitise our sales channels, Head of Digital B2Bwe empower our sales representatives to deliver BESTSELLERa more personalised and inspiring buying expe-rience, offering greater flexibility for colleagues and partners to customise and select the right products tailored to their needs.” Leading DIRECT sales in FranceInvesting inIn 2023-24, France was the market with the wholesale highest share of digital sales on DIRECT, and the second highest share of self-service orders placed by customers. Digital sales tools provide real-time stock information and order history, enabling customers to identify and order needed products quickly. Many of BESTSELLER’s largest customers still buy collections using physical samples and through traditional sales channels. During 2023-24, the French sales teams worked closely with customers to showcase the advantage of buying collections using digital sales channels. The team highlighted the benefits, such as time and cost savings and the reduced environmental impact of prioritising digital sales to reduce samples. The success of the digital transformation in France can be attributed to the local market strategy consisting of creating tailored digital content for the French market and brands, training sales representatives and customers on digital tool use, and supporting customers’ transition to digital self-service. This year, the team in France supported Intersport, one of our most important customers, to successfully transition from traditional to digital sales channels. As a major international retailer with thousands of stores, Intersport requires a flexible digital platform for their stores to place orders independently based on local market demands. By providing exclusive digital access to full collections and local digital market-ing content, the France team was able to highlight the benefits for Intersport to using digital sales, especially the self-service functionality. DIRECT is our digital B2B sales platform created to offer the best self-service shopping experience to our customers.The self-service functionality on DIRECT provides a simplified digital dashboard with real-time access to available stock, order history, and inbound orders. This provides customers with an easy overview of new products and the ability to place orders themselves with just one click. Digital sales were particularly important in France in 2024. During the Olympic Games in Paris, the city and our central showroom were largely inaccessible, un-derscoring the critical importance of digital sales channels so we could continue to help our customers place orders digitally during a normally busy sales period. Thibaut Demange “Our long-term commitment to digitalisation of Country Director our sales channels is unwavering. Using digital France & Italysales channels benefits both BESTSELLER and our customers by providing simpler and more effi-cient delivery of styles and allowing customers to tailor their own ordering to the demands of their business. We believe that by embracing dig-ital technologies, we can enhance the customer experience, drive sales growth, and position our business for future success.” A new standard for digital showrooms Investing inWith 34 digital showrooms across 18 countries, digital showroomsVERO MODA is committed to its digital journey. This year, the brand invested in localisation, training, and events to optimise the tool in close collaboration with our markets. 2023-24 brought a new BESTSELLER record for sales in our digital showrooms, achieving close to EUR 160 million in sales globally. Originally developed by VERO MODA and BESTSELLER Germany with support from BESTSELLER TECH, the tool is now used widely across a majority of brands and markets. The digital showroom tool opens up an interactive world of inspiration, colour options, data, and much more, ultimately transforming the sales experience for our sales colleagues as well as our customers. The digital showroom is a touchscreen tool that allows our sales colleagues to present and adjust new collections for customers.Susanne Buur “The digital approach is infused in everything Sales Director we do. But we cannot do it alone – we rely on our VERO MODAskilled sales colleagues around the world. For this reason, we have invested in various initiatives to create nearness, from market customisation and content creation to digital events and continu-ous trainings. Digital showrooms are a true game changer but you can only win as a team.” As the first BESTSELLER brand to invest in digital showrooms, VERO MODA has tailored the tool over a four-year period to fit our markets perfectly and keep up with ever-changing technology. In 2023-24, the brand has focused on localisation – adapting products and styling to each market – to enable sellers to build relationships with customers based on trust and authenticity. “Being digital does not create distance from our customers – on the contrary. With tools like the digital showrooms, we are bridging physical and digital sales to inspire, guide, and increase sales,” says Susanne Buur and ends: “In this financial year, we once again experienced a substantial growth in orders placed through digital showroom. Going forward, we will continue our digital investments and onboard new markets.” Innovating to improve automatic replenishment Investing inIn 2023-24, we invested in a pilot programme to customer retail valueimprove the customer value proposition of our automatic replenishment programme. The data driven programme aims to further strengthen our partnerships with retail customers and optimise product availability in challenging market conditions. The programme covers NOOS (Never out of Stock) collections, which feature timeless pieces in high demand. NOOS collections are a cornerstone of our business. In Germany, our largest market, NOOS accounts for more than 40 percent of sales.By combining our business acumen with new streams of product data, we are now investing in NooS 2.0. The programme leverages real-time data to directly optimise product flow, ensuring customers’ bestselling styles are available in the right quantities at the right time in their stores.NooS 2.0 will initially be tested with five of our largest brick-and-mortar cus-tomers in Germany using JACK & JONES and VERO MODA products. NOOS 2.0 workflows of the customers in the programme will be directly managed by ded-icated BESTSELLER teams, allowing customers to focus on their core collection management while we take care of the business of logistics.Going forward, we aim to expand the programme to even more customers in Germany and in other markets. Our long-term vision is integrating ‘in season’ products into the same workflow, further streamlining the process and ensuring shorter time to market for customers.Lars Pedersen “Our vision is to connect as many customers as Regional Director possible to the new version of our important North and Central BESTSELLERautomatic replenishment programme. This will provide great value for customers, securing the right products, the right quantity and the right flow. We have the belief to innovate and use our knowledge and technology to improve our cus-tomer value proposition.” The foundation for ecommerce & digital growthInvesting inDuring 2023-24, we invested further in the de-ecommerce and velopment of our unified commerce experience, digital solutionsdigital platforms, and our ambitious ecommerce business operation. By delivering new digital and data solutions, improving our operational effect, and focusing on providing seamless shopper experiences, our online profitability almost doubled, laying the foundation for future sustainable growth. Our online business provides inspiration, fashion trends, and the latest styles directly to shoppers across all BESTSELLER brands. More than 40 percent of our total sales are online. Our products are sold through our own platforms and as well as on those of our ecommerce partners. During 2023-24, we expanded our ecommerce to eight new markets and launched several new brands through our ecommerce platforms. We continued our focus and investment in building competitive advantage through AI forecasting, ac-curacy of buying, and sell-through models. We continued the development of our own online channels and those of our partners. We opened new marketplaces so shoppers can find our products on our own platforms as well as with even more of the biggest international online fashion retailers.We developed a stronger digital and unified commerce foundation with a new customer relationship management system (CRM/CXP) and data platforms. This included launching eight new brand apps, featuring new loyalty programmes and clubs for omnichannel shoppers. These tools provide greater flexibility and improve the way we can personalise digital shopper experiences across channels and brands. Finally, we strengthened our connected commerce experience with a new instore ordering system for retail, extended ship from store, and expanded the solution across more markets. The global online fashion market continues to be a challenging landscape. As in previous years, online sales remain flat, and profitability is impacted by distribu-tion and handling costs as well as high return rates, especially in central Europe. STRONG PROGRESS AND In 2023-24, we improved our promotional strategies, buying accuracy, and sell-PROFITABILITY IN CHALLENGING through and reduced our return rates across channels. Despite a slight decline ONLINE MARKET or flat development in sales across brands, our combined efforts resulted in doubling our profitability across our online channels, and improved our online partner trading significantly. Importantly, by improving our service offerings across markets and platforms, we doubled online shopper satisfaction based on our own and external benchmarks. Claus Nielsen “Our ambition is to build world-class, unified Business Director commerce experiences across our brands, Ecommerce & Digital BESTSELLERmarkets, and channels. Through our insight and data-driven approach, this year’s result shows that we have laid the foundation for the future sustainable growth of our ecommerce and digital channels.” A connected shopping experience Investing inJACK & JONES launched its first shopper loyalty omnichannelprogramme, JACK & JONES Club, providing shop-pers exclusive rewards and personalised benefits for instore and online shoppers.Now successfully rolled out to more than 10 markets across Europe, the app-based programme represents a significant milestone in the brand’s omnichannel journey. The rollout of the loyalty programme also includes retail partner stores, to ensure a unified approach across the brand.JACK & JONES Club offers a variety of personalised benefits for members. These include exclusive member deals, digital receipts, and bonus point vouchers. Importantly for shoppers, the loyalty programme is an omnichannel solution to connect instore and online channels. For every euro spent in store or online, members earn one point, which can be redeemed for a EUR 5 voucher once 100 points are accumulated. Shoppers scan their individual member ID in the app at check-out to claim and spend points.Early results are promising. Across all markets, JACK & JONES Club members have, on average, a more than 40 percent larger basket size and a 30 percent higher basket quantity compared to non-members. This demonstrates the programme’s effectiveness in driving shopper engagement and loyalty.The project required coordination and dedication across the company, show-CROSS-FUNCTIONAL casing the strength of teamwork between retail, e-commerce, and tech teams. SUCCESS While developing the programme, investing in the right technology, and testing instore and online was essential to ensure shoppers have smooth and seamless experiences in-stores at check out and on digital platforms. The programme’s success also relies heavily on the dedication of JACK & JONES’ in-store colleagues. With 100 percent staff-driven signups, these colleagues play a crucial role in welcoming new members and driving shopper loyalty.The app will be rolled out to 10+ further retail markets in Europe during 2024.Helena Pinderup Schelle “The JACK & JONES Club exemplifies our com-Digital Retail Manager mitment to providing a seamless and rewarding JACK & JONESshopping experience for our customers, both online and in stores. As the programme continues to grow and evolve, it will play a crucial role in gathering customer insights and feedback, steer-ing the direction of our brand. Additionally, it will drive sales growth, increase store traffic, enhance customer retention, satisfaction, and engage-ment, all while fostering stronger relationships with our customers”.From supporting colleagues with AI tools to digitising sales to reduce products samples and building traceability through our material supply chain, this year’s tech investments play an important role in our company’s responsibility to our people and our planet. In the next chapter, you can read more about selected investments in this key area of our business.People& planetWe have a responsibility to operate our business with respect for people and planetary boundaries. Our sustainability strategy, Fashion FWD, sets the direction for reducing our impact and bringing fashion forward towards a more circular future. This chapter will delve into some of the key investments made during 2023-24 to reaching our sustainability ambitions. This begins with our commitment to the well-being of the 22,000 colleagues in our company and our pledge to build a more diverse, equitable, and inclusive workplace. It emphasises the important investment in helping suppliers transition to clean, renewable energy and addressing their environmental and social im-pact. Finally, we focus on the investment in the raw materials in our products. Here we focus on cotton, where we have made progress in 2023-24. In the Sustainability Statement, we dive deeper into the details of our approach, progress, and the challenges we face to reach our ambitious goals.People are the heart of our company Investing inMore than 22,000 colleagues around the world peoplemake up BESTSELLER. In 2023-24, we signed the Gender Diversity Pledge and continued our commitment to a safe workplace built on respect through investments in new policies, surveys, and systems.Every year, we set out to grow our business – and our people. In 2023-24, we grew the BESTSELLER family by 2,000 colleagues and welcomed skilled people to our culture of trust, respect, fairness, and responsibility. While these values have been the foundation of BESTSELLER ever since our two founders welcomed the first colleagues almost 50 years ago, we remain deeply com-mitted to ensuring an inclusive workplace with equal opportunities for everyone. For this reason, we continued our work with diversity, equity, and inclusion (DEI) by launching a new DEI policy and signing the Confederation of Danish Industry’s Gender Diversity Pledge. By placing our signature, we have committed to work-ing with our diversity goals and developing an action plan to reach our targets. 20,000colleagues worldwide2022—23Louise Sylvest “Our values and the wish to make everyone in Chief People Officer & Head of the BESTSELLER family feel welcome, respected, BESTSELLER Identity and at home, have always been important to us. However, we need to make sure we do not take this aspect for granted. That is why we have put our existing stance on the matter in writing. Research shows that companies with high levels of diversity and inclusion tend to achieve greater long-term success. While we acknowledge our past achievements, we must remain vigilant and recognise the ongoing work ahead.” 22,000colleagues worldwide2023—24It has also been yet another year of investing in the personal growth of our colleagues. Through BESTSELLER Academy we have conducted more than 5,700 training sessions to ensure continuous development and new opportunities for thousands of colleagues. Furthermore, we have introduced digitalised growth management in our digital HR system, offering a new user experience to enhance and manage personal as well as team goals. By investing in new people initiatives, we are only halfway there. To ensure that these initiatives are well-received and spark positive change, feedback and data are crucial. In 2023-24, we launched a new exit survey to support the data from current colleagues gained through Our People’s Voice – our annual employee survey that reached a record response rate of 83 percent in this financial year. Supplier sustainability evaluation Investing inIn 2023-24, we placed 78 percent of product or-suppliersders with suppliers highly rated in our Supplier Sustainability Evaluation. The result is a signif-icant increase from 2022-23 and means we have surpassed our goal of placing 75 percent of orders with highly rated suppliers by 2025. The Supplier Sustainability Evaluation plays a central role in BESTSELLER’s dedication to rigorous assessment and engagement in reducing the environmental and social impact in our supply chain. Each supplier’s evaluation integrates factory-level data on human rights and environmental performance with supplier-level data on responsible supply chain management, commitment, and ethics & transparency. To achieve a high rating, suppliers must not only meet our expectations, but demonstrate proactive efforts to reduce their impacts and contribute to improvements in the industry and their communities.In practiceThere are hundreds of indicators of human rights risks we Evaluating social impactare monitoring at each factory. To be highly rated, factory management teams have to consistently demonstrate that they are providing safe, secure workplaces that go above and beyond the expectations in our Code of Conduct. In practiceEvaluating Every factory is different, but nonetheless every process at environmental each factory has an impact. To be highly rated, a factory impactneeds to be managing and reducing its impacts and show-ing us that they are doing all they can to be as resource efficient as possible. 78%of product orders placed with highly rated suppliersFelicity Tapsell “Reaching the target ahead of schedule under-Head of Responsible Sourcingscores the vital role of collaboration between BESTSELLER suppliers, factories, and BESTSELLER. Through committed partnerships, we can foster a shift in practices at a factory level that paves the way for improvements across our supply chain, signifi-cantly reducing the risks we see.”Decarbonising the supply chain Investing inMore than 40 percent of our total climate reducing supply chain emissions come from yarn & fabric production emissionsand garment manufacturing. To succeed in decoupling emissions from our growth, we will continue to increase our investments to support suppliers in our most important sourcing coun-tries transition to renewables. As part of our existing collaboration with suppliers, we require factories to track all energy sources and establish a baseline for energy use. We work together with suppliers to set targets for reducing energy consumption or transitioning to cleaner fuels. This factory level work is essential, but for change to happen faster, we must increase our investment at a much larger scale. During 2023-24, we made progress on a key factory level initiative, and pledged our commitment to two new macro level investments. MRenewable energy initiativeWe pledged to invest up to DKK 700 million in an offshore wind energy project in Bangladesh. The Renewable Energy Initiative (REI) is a macro scale pro-ject, which will have an approximate capacity of 500 megawatts and generate renewable energy for Bangladesh’s electricity grid, supporting the renewable infrastructure in the country. The project is expected to contribute to job creation, stabilise energy supply, and reduce carbon emissions by approximately 725,000 tonnes annually. The pledge is made in collaboration with the H&M Group and facilitated by Global Fashion Agenda (GFA). The wind project is initiated by Copenhagen Infrastructure Partners (CIP), a global leader in renewable energy investments.Reducing our climate footprint, especially in our indirect value chain, is a signifi-cant challenge for our company and the entire fashion industry. The investment in Bangladesh is a testament to our commitment to this goal.The current political instability in Bangladesh poses a substantial risk to the REI’s project timeline. Despite this, we remain dedicated to supporting the country’s transition to renewable energy. If the project is not deemed feasible, we will work with our partners to explore alternatives projects and will pledge the same level of investment.Global supply chainOur products are manufactured by more than 350 suppliers in 18 countries.Investing in the future of our suppliersJoined by leading fashion companies, The Fashion Pact, and Apparel Impact Institute, we launched the Future Supplier Initiative to accelerate the textile industry’s green transition. This collaborative, macro level investment aims to provide financial security, technical expertise, and economic incentives to textile factories, empowering them to reduce their environmental impact.The initiative prioritises projects with high impact potential and scalability. It will support textile manufacturers implement resource conservation, electrifi-cation, and renewable energy solutions in their production facilities. Starting in Bangladesh and Vietnam, the programme plans to expand to other major fashion-producing countries.This initiative signifies a new approach to sustainability in the fashion supply chain, where leading brands join forces to drive collective change. By sharing the costs and risks, brands and suppliers can collectively make more progress than what can be achieved alone. Several fashion companies, including BESTSELLER, Gap Inc., H&M Group, Lu-lulemon, and Mango, have joined the initiative. To realise the full potential of this initiative, it is vital that even more brands participate.Solar powering factories While the Renewable Energy Fund and Future Supplier Initiative represent our efforts to decarbonise the supply chain across the wider fashion industry, we work on factory level initiatives to directly enable suppliers to transition to renewable energy. One such initiative is our collaboration with SOLshare, a pioneering Bangladeshi climate-tech company, to support our suppliers to finance and install the solar panels, allowing suppliers to purchase the green energy generated at rates lower than grid electricity.In 2023-24, a combined total of more than 1,800-kilowatt peak (kWp) of installed solar panels were in operation across five factories in Bangladesh. Since com-mencing operation, the five solar systems generated more than 700,000 kilowatt hours (kWh), saving more than 450 tonnes of carbon emissions. Furthermore, construction of another 1,000 kWp of solar power system is under-way at one more supplier factory, while negotiations are underway for further two installations of more than 1,800 kWp. Michael W. Schultze “Directly supporting suppliers to reduce their Director, Global Supply Chainemissions is one of the many steps we are taking BESTSELLER to decouple growth from increasing climate impact. Each new solar system installed at factories in Bangladesh is a testament to our collaboration with our partners and suppliers on systemic solutions.” Innovation through collaborationInvesting inAs part of our Fashion FWD strategy, we focus innovation on scaling innovation investments from pilots to production. This financial year has been no exception with 15 active collaborative projects and an increase in BESTSELLER styles made with certified and branded materials. Through our two main innovation platforms, BESTSELLER Innovation Lab and Invest FWD, we invest in in-novation and collaborate with brands, suppliers, material innovators, and research projects to address systemic challenges and launch product pilots and, eventually, scale these ideas to reach a commercial level.Dorte Rye Olsen “To succeed in solving the material challenges Head of Sustainabilitywe face in the fashion industry by moving from BESTSELLER a linear model to a circular model, collaboration with research institutions and partners across the entire value chain is key. Going forward, via-ble business case structures and new investments will be essential pieces in the puzzle we are trying to piece together as an industry and society.”While several of our brands launched pilot collaborations with innovators this year, such as OBJECT x Evrnu® and VILA x OnceMore®, JACK & JONES took the next step towards scaling up production. The brand launched a second collaboration with Spinnova®, a Finnish innovator with a patented technology for making textile fibre out of wood or waste, this time introducing a higher fibre-blend percentage and a larger product quantity. Read more about innovations and partnerships on page 156.15innovation projectsOur direct-to-farmcommitmentInvesting inIn 2023-24, we invested more than DKK 23 million materialsin giving our direct-to-farm cotton programme a leg up. Approximately 3.2% of the global cotton grown is organic. As the supply chain in the fashion industry is opaque and complex, it is difficult to trace organic cotton credentials. Direct-to-farm sourcing is BESTSELLER’s preferred method for supporting farmers transition from conventionally farmed cotton to the development of transparent and fair production of organic cotton. Compared to conventional cotton, producing organic cotton improves soil health and biodiversity, uses no genetically modified seeds and harmful chemicals, while promoting safer and healthier working conditions for farmers and their communities. Through direct-to-farm we work to shorten the supply chain from the beginning. We engage with individual farmers, either directly, or through third parties and every year we commit to facilitate the off-take of a certain amount of organ-ic cotton from the upcoming harvest. This ensures the flow of raw material through the value chain for next year’s products. At the same time, we play an important role in supporting the livelihoods of the people and their families growing cotton organically. In 2023-24, we nearly doubled the amount of organic cotton used in our products INCREASED COMMITMENTfrom 11 percent to more than 21 percent. This was driven by the investments made in previous years by JACK & JONES and ONLY from which we now see the benefits. Both brands’ efforts are focused on converting the NOOS (Never Out Of Stock) collections, which feature timeless pieces in high demand. NOOS collections are a cornerstone of our business, so this is where we can make a big impact.JACK & JONES converted the brand’s most popular pants programme, Paul Flake, to use direct-to-farm sourced cotton. The programme covers more than 1.6 million pieces sold and is, to date, the biggest selling programme converted by the brand. More than 20 percent of the volume of JACK & JONES’ NOOS collection has been converted from conventional to organic cotton, an increase from 6 percent in 2022-23.ONLY converted the brand’s popular Blush and Power denim lines to use Cotton made in Africa (CmiA). This more than doubled the amount of organic cotton we sourced from Africa and resulted in approximately five million jeans produced using the material. Both JACK & JONES and ONLY have again increased their pre-sea-son commitments to direct-to-farm sourcing. Across all brands we have committed to sourcing 40 percent more organic cotton in 2024-25.Jonas Meier Sørensen “Collaboration is key to driving meaningful Buying Manager impact and building integrity in our organic ONLYcotton supply chains. By supporting organic farmers with long-term commitments, we address the challenges of the global organic cotton market and ensure the authenticity of our sourcing. Working with CmiA we directly support making organic farming an attractive choice for farmers in Africa and can make a positive impact on local societies.”COTTON MADE Our direct-to-farm cotton initiatives prioritise transparency and integrity IN AFRICA throughout the cotton supply chain. This approach enables us to positively impact the livelihoods of the individuals producing the raw materials used in our products. By fostering the growth of organic cotton production through direct partnerships, we contribute to both ethical sourcing and a positive social impact. This commitment allows us to provide our customers and consumers with products they can trust, knowing their origin and the positive influence they have on the lives of cotton farmers.ONLY works with Cotton made in Africa (CmiA), a leading initiative for organic cotton, to source organic cotton grown in Tanzania and Benin. This year, we collaborated with the CmiA Community Cooperation Programme to support cotton farming communities in Benin, where the cotton used to make ONLY jeans is produced. We provided financial support to improve educational and water infrastructure. This included constructing a new school block with three classrooms and two latrines. Additionally, table benches were provided to ensure proper seating for students. To address water needs, two boreholes were drilled, providing reliable access to clean water. Through this collaboration, more than 4,000 community members in three cotton farming villages have benefitted from improved access to education, clean water, and improved hygiene practices. Read more about how we source cotton and direct-to-farm on page 160. These selected investments in People & Planet conclude the highlights of 2023-24 – a year of investments. In the next part of the annual report, you can learn more about our sustainability and responsibility efforts as we report our sustain-ability performance, risks, strategy, and governance in this year’s Sustainability Statement. Ethical business conduct INTRODUCTIONThe complex fashion supply chain demands ethical conduct, especially in regions with weak institutions where risks of unethical practices such as corruption and bribery can occur. APPROACH To mitigate against such risks, colleagues receive biannual training on our Code of Ethics. The online training is also included in our onboarding material for new colleagues. The Code of Ethics is our primary tool to guide colleagues in conducting business with a high standard of integrity and protect our business against unethical practices. The Code of Ethics exemplifies and supports the principles and re-quirements set out in our Anti-Corruption and Anti-Fraud Policies Online training provides the most efficient way to ensure all colleagues globally are trained in our Code of Ethics and receive any new guidance. At our headquar-ters in Denmark, we are developing specialised training for colleagues dealing with suppliers to enhance anti-corruption awareness. Our Sanctions Screening Tool supports our sourcing colleagues identify supplier risks associated with sanctions. All suppliers of finished products must sign our Supplier Code of Conduct (CoC). We are in close dialogue with our suppliers and their factories to make sure they are compliant with our CoC. Our Factory Standards Programme includes regular assessments of supplier factories to identify potential violations and we provide guidance and assistance to overcome potential challenges. We take all reports of potential violations seriously and investigate them thorough-ly to ensure compliance with our CoC and related supply chain sourcing policies. ADDRESSING We encourage open communication and provide multiple channels for report-GRIEVANCES ing potential CoC violations within our supply chain. Stakeholders, including individuals, communities, and representatives, can raise concerns regarding adverse impacts caused by us or those acting on our behalf. We recognise the importance of effective grievance mechanisms and provide various avenues for workers to raise concerns related to human rights and en-vironmental risks. Our ecosystem approach to grievance mechanisms acknowl-edges that no single mechanism addresses all concerns, and we continuously strive to improve their efficacy. We publish data annually in our Incident Log, highlighting the multiple channels available for raising concerns and grievances. We prohibit retaliation against whistleblowers and users of grievance mecha-nisms, and this is clearly outlined in our Code of Conduct. We prioritise confi-dentiality for complainants, but in some cases, identification may be necessary. When identification is required, we guarantee obtaining permission from the relevant rightsholders. Furthermore, BESTSELLER requires suppliers and production sites involved in manufacturing our products to provide an anonymous method for workers to report workplace grievances. We ensure that policies are in place to protect workers when reporting complaints and grievances in good faith. Production sites are assessed on the availability and efficacy of onsite grievance mechanisms. Through open communication and an accessible grievance mechanism, we aim to foster a responsible and ethical supply chain that respects human rights and environmental standardsGRIEVANCE Through our parent company, HEARTLAND, we offer a whistleblower system MECHANISMS for employees and partners to report unethical practices. This system provides an alternative channel for reporting serious issues, especially when formality or anonymity is desired. In Bangladesh, all factories working with BESTSELLER are covered by the In-ternational Accord’s RSC-managed complaint mechanism. Similarly, in Pakistan, all BESTSELLER-supplying factories, including fabric mills, are covered by the complaint mechanism established by the expanded International Accord. In Myanmar, BESTSELLER is piloting a worker voice tool developed by software company Ulula. This tool, developed in partnership with Ulula and MICS, allows workers to provide feedback on workplace conditions and employer well-being, contributing to improvements in these areas.GOALAll colleagues must complete Code of Ethics training every two years, and new colleagues will be introduced to the Code of Ethics training as part of their onboard-ing in order for us to uphold our founding principles and maintain ethical business practices.PROGRESSIn 2024 the new Code of Ethics training was rolled out to all colleagues globally. The new course consists of 12 short videos, each taking colleagues through a specific subject included in our Code of Ethics. The training was split into two separate versions, one for office and warehouse colleagues, and, for the first time, a newly developed version for retail colleagues. Peter Holm “We need to make sure that we comply with laws Manager and regulations and that we maintain the highest Legal Sustainability BESTSELLERlevel of business ethics and personal integrity in everything we do. Therefore, we have formulated BESTSELLER’s Code of Ethics, a set of binding guidelines made to help everyone at BESTSELLER understand what is expected of us in terms of ethical behaviour.”The key tool to guide colleagues in compliance with the Code of Ethics is TEFA (Transparency, Effect, Fairness, Advantage). Other topics covered concern bribery, gifts, confidentiality, and harassment. In 2023-24, the use of generative artificial intelligence (GenAI) was included in the training. See page 186 for more information regarding our approach and progress in terms of identifying and addressing non-compliance with our Code of Conduct in our supply chain. GOING FORWARD We will continue to roll out the Code of Ethics training to all new colleagues and are planning a new rollout in 2026.BESTSELLER FOUNDATION— investing in entrepreneurs that invest in people and planet BESTSELLERFoundationINTRODUCTIONFunded by BESTSELLER, the foundation supports, co-creates, and invests in solutions for an inclu-sive, circular future in Sub-Saharan Africa and BESTSELLER communities. Convinced that talent is everywhere, but opportunity is not, the foundation was among the first to believe in the potential of impact investing on the African con-tinent. By 2030, ~50 percent of the world’s youth will live in Africa. By 2050, one in four people on the planet will be African. That is why the foundation invests in climate-friendly, fast-growing, local ventures that generate jobs and opportunities. In 2022-23, the foundation continued to strengthen its footprint in BESTSELLER communities. Among other initiatives, colleagues were invited to nominate a charitable cause close to their hearts for the annual New Year’s donation from BESTSELLER Foundation. Six organisations supporting various vulnerable groups were granted a total donation of DKK 3.5 million.Going forward, the foundation will work more closely with BESTSELLER to support inclusive, circular solutions in BESTSELLER communities and Sub- Saharan Africa. UNLEASH Innovation Lab 2023The foundation was instrumental in bringing the Innovation Lab to the African continent and supported the circular economy track when +1,000 young, global changemakers gathered in Kigali, Rwanda, including 20 BESTSELLER experts and colleagues. Highlights 2015-2024The foundation’s impact thesis +25+100is wrapped around quality job creation, promoting gender impactful investmentscharitable donationsequity, and climate-friendly solutions. 25+7,000countries reachedtotal, direct jobs created across the investment portfolio47%83%female founders in the employees are youth investment portfolio(< years)Investee spotlight:Sand Technologies – developing digital leaders across AfricaSand Technologies creates impactful AI solutions for sectors such as healthcare, telecommunications, utilities, insurance, etc.At any given time, 250,000 young people are in training at +35 Sand hubs and campuses, getting skilled in AI, data science, data engineering, cloud computing, and more to unlock quality jobs.GROUP CHART SYMBOL OVERVIEW• Subsidiary• • Subsidiary of subsidiary• • • Subsidiary of subsidiary of subsidary* Associated company 1 Use of the exemption from Article 264 Para. 3 HGB [Handelsgesetzbuch: German Commercial Code] (no preparation of a management report) All companies highlighted in pink are 100% owned subsidiaries of BESTSELLER A/S.Group chartCOMPANYLOCATION OWNERSHIPBESTSELLER A/S Brande, DenmarkAHPK GmbH 1Hamburg, Germany100%24.5.2011 US CorporationWilmington, Delaware, USA100%• BESTSELLER Wholesale US LLCWilmington, Delaware, USA100%BESTSELLER ASOlso, Norway100%BESTSELLER Logistics A/SBrande, Denmark100%BESTSELLER Australia PTY Ltd.Mosman, Australia100%BESTSELLER Birlesik Tekstil Ltd.Istanbul, Türkiye90%BESTSELLER Commerce B.V.Amsterdam, Netherlands100%• BESTSELLER Handels B.V.Amsterdam, Netherlands100%• BESTSELLER Service B.V.Amsterdam, Netherlands100%BESTSELLER Commerce Poland Sp. z O.O.Lozienica, Poland100%BESTSELLER Handels Portugal, Unispessoal LDALisbon, Portugal100%BESTSELLER Italy SpACastel San Pietro Terme, Italy100%• BESTSELLER Stores Italy SpACastel San Pietro Terme, Italy100%BESTSELLER Stores Austria GmbHVienna, Austria100%• BESTSELLER Handels GmbHVienna, Austria100%• BESTSELLER MENA GmbHVienna, Austria100%BESTSELLER Retail Europe A/SBrande, Denmark75%• BESTSELLER Retail Benelux B.V.Leusden, Netherlands100%• BESTSELLER Retail Sp. z O.O.Warsaw, Poland100%• ONLY Stores Austria GmbHVienna, Austria100%• Grønhaug Retail AS*Bergen, Norway50%• ONLY Stores A/SBrande, Denmark100%• • ONLY Stores Italy SRLCastel San Pietro Terme, Italy100%• • ONLY Stores Belgium BVBAAntwerp, Belgium100%• • ONLY Stores Czech s.r.o.Prague, Czech Republic100%• • ONLY Stores Denmark A/SBrande, Denmark100%• • ONLY Stores Finland OYEspoo, Finland100%• • ONLY Stores France SaSParis, France100%• • ONLY Stores Germany GmbH 1 Viersen, Germany100%• • ONLY Stores Ireland Ltd.Dublin, Ireland100%• • ONLY Stores Holland B.V.Leusden, Netherlands100%• • ONLY Stores Luxembourg S.a.r.l.Luxembourg, Luxembourg100%• • ONLY Stores Norway ASBergen, Norway100%• • ONLY Stores Sweden ABSolna, Sweden100%• • ONLY Stores Switzerland AGSt. Gallen, Switzerland100%• • Retail-Fabrikken A/S *Haderslev, Denmark50%BESTSELLER Retail Ireland LimitedDublin, Ireland100%BESTSELLER Retail UK Ltd.Birmingham, England100%BESTSELLER (Schweiz) AGGlattbrugg, Switzerland100%BESTSELLER Stores Belgium BVBAAntwerp, Belgium100%• Belalan Meir Leasehold SRL Antwerp, Belgium 100%BESTSELLER Stores Denmark A/SBrande, Denmark100%BESTSELLER Stores Finland OYHelsinki, Finland100%BESTSELLER Stores Germany GmbH 1Hamburg, Germany64%BESTSELLER trgovina SLO d.o.o.Ljubljana, Slovenia100%BESTSELLER Fashion India Pvt. Ltd.Mumbai, India12%BESTSELLER Stores Netherlands B.V.Amstelveen, Netherlands100%• BESTSELLER Wholesale Benelux B.V.Amstelveen, Netherlands100%• BESTSELLER United NL B.V.Amstelveen, Netherlands100%• • Indifusion Apparels India Pvt. Ltd.New Delhi, India100%• • BESTSELLER Fashion India Pvt. Ltd.Mumbai, India88%• • • BESTSELLER Wholesale India Pvt. Ltd.Mumbai, India17%• • • VERO MODA Retail Pvt. LtdMumbai, India14%• • • BEST United India Comforts Pvt. LtdMumbai, India19%BESTSELLER Stores Luxembourg SarlLuxembourg, Luxembourg100%BESTSELLER Stores Norway ASBergen, Norway100%BESTSELLER Stores Sverige ABSolna, Sweden100%BESTSELLER Stores Switzerland AGGlattbrugg, Switzerland100%BESTSELLER Sverige ABSolna, Sweden100%• Hagamagasinet ABSolna, Sweden100%BESTSELLER Textilhandels GmbH 1Hamburg, Germany100%BESTSELLER United China Ltd.Kowloon, Hong Kong100%BESTSELLER United Singapore Pte. Ltd.Singapore, Singapore100%• BESTSELLER Wholesale India Pvt. Ltd.Mumbai, India83%• BEST United India Comforts Pvt. Ltd.Mumbai, India81%• ONLY Retail Pvt. Ltd.Mumbai, India100%• SELECTED Retail Private LimitedMumbai, India100%• VERO MODA Retail Pvt. Ltd.Mumbai, India86%BESTSELLER Wholesale A/SBrande, Denmark100%BESTSELLER Wholesale Belgium BVBAAntwerp, Belgium100%BESTSELLER Wholesale Canada Inc.Montréal, Canada100%• BESTSELLER Retail Canada Inc.Montréal, Canada100%BESTSELLER Wholesale Finland OYHelsinki, Finland100%BESTSELLER Wholesale France SaSParis, France100%• BESTSELLER Stores France SaSParis, France100%• 9/9 - 49 France SarlParis, France100%• Paris Property SASUParis, France100%BESTSELLER Wholesale (Ireland) Ltd.Dublin, Ireland100%BESTSELLER Wholesale Spain S.L.U.Churriana, Spain100%• BESTSELLER Tekstil Ltd.Istanbul, Türkiye100%• BESTSELLER Stores Spain S.L.U.Churriana, Spain100%• BS Company of 14.12.2014 Sociedad LimitadaChurriana, Spain100%• • BESTSELLER Latam ZF S.A.Montevideo, Uruguay100%• • BESTSELLER Textil Mexico S.A. de C.V.Ciudad de México, Mexico100%• • BESTSELLER Textil Whs Uruguay S.A.Montevideo, Uruguay100%• • BESTSELLER Wholesale Chile SpASantiago Chile100%• • BESTSELLER Wholesale Mexico S.A. C.V.Ciudad de México, Mexico100%BESTSELLER Wholesale UK Ltd.London, England100%Best Whs Clothing Greece LLCAthens, Greece100%Bluetide Ltd.Dubai, United Arab Emirates100%Braveheart International Limited.London, England100%BRN Best Retail Norge ASNamsos, Norway51%Toast (Mail Order) LimitedLondon, United Kingdom100%• TOAST US, Inc.Chicago, USA100%• • TOAST US, Retail, LLC.Chicago, USA100%VILA A/SSkanderborg, Denmark100% • VILA Belgium BVBAAntwerp, Belgium100%• VILA Benelux B.V.Amstelveen, Netherlands100%• • VILA Stores B.V.Amstelveen, Netherlands100%• VILA Clothes AGGlattbrugg, Switzerland100%• VILA Clothes Handels GmbHVienna, Austria100%• VILA Clothes Ltd.Dublin, Ireland100%• VILA Clothes Ltd.London, United Kingdom100%• VILA Finland OyEspoo, Finland100%• VILA France SaSParis, France100%• VILA Italy S.R.L.Caste San Pietro Terme, Italy100%• VILA Norge ASOslo, Norway100%• VILA Spain S.L.U.Torremolinos, Spain100%• BESTSELLER Stores Germany GmbHHamburg, Germany36%• • VILA GmbH 1Hamburg, Germany100%• VILA Sweden ABSolna, Sweden100%• VILA Wholesale A/SSkanderborg, Denmark100%