JD Sports wins fans with its fashions

STYLE-orientated teenagers and twenty-somethings who shrugged off the recession are expected to have sent profits surging by almost two thirds at retailer JD Sports Fashion when it unveils annual results this week.

The City sharply upgraded forecasts in January after the company, whose main fashion brands include Bank and Scotts, said – for the second year running – it expected profits to "significantly exceed" market expectations.

The City is this week expecting pre-tax profits to have leaped to 63.3 million in the year to the end of January from 38.2m previously.

Before last January's trading update, the consensus profit forecast was 56m.

Revenues are expected to be around 734.5m as JD's target demographic market proved one of the most resistant to the economic downturn. The dividend is expected to be hoisted 21 per cent to 14.5p (12p) when the group reports on Wednesday.

One analyst said: "As the sharp ramp-up in yearly profits is already in the market most of the spotlight will be on how well JD's like-for-like sales have gone to early April, the first couple of months of its new financial year. Most people expect those numbers to have been quietly impressive."

The City believes the company's key strength is its reliance on fashion as opposed to the largely replica-football-shirt, discounted-price offering of rivals such as JJB Sports and Sports Direct International.

One retail analyst said: "That football market can be lumpy in earnings. JD sidesteps a lot of that with its greater reliance on fashion."

However, Freddie George at Seymour Pierce said: "While it is true JD is not so dependent on football shirt sales as its rivals, the coming World Cup should still prove helpful to the group."