JD Sports, the sportswear chain which also owns Blacks and Go Outdoors and has a controlling stake in Scottish outdoor retailer Tiso, is eyeing further growth opportunities after cheering record results.
The group reported a 49.2 per cent hike in annual revenues to £4.7 billion for the 52 weeks to 2 February, coming in at the higher end of market expectations. Profit before tax rose 15.4 per cent to £339.9 million.
JD said it was “not immune” to the challenges facing the wider UK retail sector, but added that its British and Irish business had delivered an increase in sales and profitability.
The performance has reinforced management’s belief that bricks-and-mortar stores are still having a positive influence, as the estate “raises brand awareness, provides consumers with an opportunity to physically see and try the product, and enables us to provide multiple delivery points”.
Globally, the group opened a net 83 additional JD stores during the period with 78 of these in international markets as it turns its attention abroad.
In the US, the first five JD stores were opened, including four conversions of existing Finish Line stores. JD bought the American retailer last year and has been working to improve its profitability.
Executive chairman Peter Cowgill told investors: “We firmly believe that the elevated and dynamic multibrand, multichannel proposition of the core JD fascia, which enjoys the ongoing support of the key international brands, has the necessary agility to continue to exceed consumer expectations and prosper in an increasing number of international markets.”
He added: “We believe that our acquisition of the Finish Line business in the United States, the largest market for sport lifestyle footwear and apparel and the home to many of the global sportswear brands, will have positive consequences for our long-term brand engagement whilst significantly extending the group’s global reach.
“We maintain our belief that Finish Line is capable of delivering improved levels of profitability.”
The firm said it had been a “particularly weather-challenged year” for its outdoor businesses. Despite that, total like-for-like sales, including online, across the division’s combined fascias remained “marginally positive”, JD added.
The board has proposed a final dividend of 1.44p, up from 1.37p, bringing the total shareholder payout for the year to 1.71p, an increase of 5 per cent.
David Madden, market analyst at CMC Markets UK, said JD Sports was a company that was “in fashion”.
“The dividend was nudged higher to 1.44p from 1.37p, and even though it isn’t a huge pay-out, at least it is increasing,” he noted.
“The firm is the standout performer of the retail sector.”