Ashley - from zero to hero as profits surge at Sports Direct

The firm - which floated in 2007 and had a disastrous first year as a listed company - exceeded its own targets of 195 million to hit underlying profits of 200.4m in the year to 24 April, triggering a share pay-out worth an average of more than 40,000 for its 2,000 staff members.

Revenues across the group - which owns more than 350 stores in the UK alone plus a number of brands including Kangol and Dunlop - jumped more than 10 per cent to almost 1.6 billion as Sports Direct benefited from the decline of rival JJB Sports.

It was the second year in a row that the firm, which entices shoppers through its doors with heavily discounted sports goods, hit profits targets, which means that staff, who earn an average of 20,000, will share in an 87.7m pot for the two most recent financial years combined.

The combined pay-out, which is believed to be the biggest of its kind in the retail sector, will see each member of staff receive shares worth an average of 43,860 at today's prices.

However, the shares cannot be traded in for at least another year, meaning they could be worth more if the stock, which has climbed 130 per cent over the past 12 months, continues to rise.

Analysts said the problems at rival JJB had undoubtedly contributed to Sports Direct's success in what continues to be extremely challenging retail conditions.

But Ashley, who was once a target for criticism in the City for his brash ways and Sports Direct's poor communication in the months following its flotation, was also credited for his shrewd tactics.

Nick Bubb of Arden Partners said: "It's a combination of the weakness of JJB and the focus of management in getting back to basics and the staff incentives."

Dave Forsey, Sports Direct's chief executive, said: "Key to this growth has been the success of our employee bonus share scheme, which we introduced to focus the whole group on our ambitious growth targets. The strength of our business model means that we are very well positioned for the challenges and targets for the future."

With JJB still battling for survival, Ashley is now believed to be going after rival JD Sports, which has positioned itself at the more upmarket end of sports fashion retailing.Some analysts saw the Newcastle United owner's decision last week to buy a majority stake in Sir Tom Hunter's USC and Cruise clothing businesses for 7m as the first step in his quest to bring down JD Sports.

Seymour Pierce analyst Freddie George said of the results: "These figures are at the top of expectations and are excellent considering the economic backdrop."

There was no final dividend.