JD Sports sprints ahead with record interim results
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Pre-tax profit excluding exceptional items soared 66 per cent year on year to £77.4 million for the 26 weeks to 30 July, and executive chairman Peter Cowgill said the performance “exceeded reasonable expectations” as last year’s result was in itself a record for the group.
Total sales rose by 20 per cent to reach £970.6m as like-for-like sales at its shops jumped by about 10 per cent.
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Hide AdOn the company’s global growth, Cowgill said: “Although the UK’s vote to leave the European Union means that there will be some uncertainties over the next two or three years, we have no doubt that we have the support of our brand partners to continue our expansion in Europe and beyond.”
He said the company, which has 66 stores north of the Border and owns a controlling stake in Scottish outdoor goods retailer Tiso, expects to open further JD shops across Europe in the remainder of the year, including flagship-style premises in Brussels and Cologne.
Further afield, since the interim period ended the company has acquired Next Athleisure in Australia, which it said has 32 stores trading as Glue and will “provide the platform to open JD in Australia”.
Hargreaves Lansdown equity analyst Nicholas Hyett noted the change in fortunes of JD Sports compared to Sports Direct, with the former having become “the bigger fish” because of what he said was its focus on quality.
He added: “Sports Direct have long used discounted brands to lure customers through the doors, before hitting them with both barrels with low-cost, own-brand goods. By comparison JD Sports have sought to show off brands at their best.
“As a result, sports brands are willing to give the retailer their best products on favourable terms and that brand support has been key to the successful European roll-out.”
Cowgill had noted the investments made over years to develop the JD retail concept.
However, while Hyett said there are still some potential hurdles for the company, such as its outdoor business, “with Sports Direct’s bargain basement pricing looking increasingly unsustainable and its relationship with many major brands in tatters, it looks like JD Sports will be topping the podium for some time yet”.
JD Sports, which said basic earnings per share grew 69 per cent to 29.83p for the period, closed the session up 5 per cent at 1,400p.