Mike Ashley’s Sports Direct International said its reported profit before tax fell 22.2% to £281.6 million in the year ended April 30, 2017, but the firm’s shares rose more than 7% as it gave investors a positive outlook for the current year.

The firm blamed the devaluation of sterling against the US dollar for much of the decline in profits.

Revenue rose 11.7% to £3.24 billion. Underlying profit before tax fell 58.7% to £113.7 million.

Sports Direct also said former Wincanton finance director Jon Kempster would join Sports Direct as chief financial officer and an executive director on September 11, 2017.

Ashley, Sports Direct’s chief executive, said: “Sports Direct is on course to become the ‘Selfridges’ of sport by migrating to a new generation of stores to showcase the very best products from our third party brand partners …

“As previously announced, the devaluation of sterling against the US dollar has led to a significant impact on EBITDA and profits in FY17.

“We have put in place hedging arrangements to minimise the short-term impact of currency volatility, but like many UK retailers we remain exposed to medium-long term currency fluctuations.”

In his outlook, Ashley said: “We are pleased to confirm that early indications show that trading in our new generation flagship stores is exceeding our expectations …

“This should be balanced against the continued impact of the devaluation of sterling against the dollar, with our GBP-USD requirements hedged at 1.31 for FY18 (compared with a historical long-term average closer to approx. 1.6).

“Taking all of these factors into account, our outlook is optimistic and we aim to achieve growth in underlying EBITDA in the region of approx. 5%-15% during FY18.

“However, we will continue to be conservative in managing for the medium to long term, which may result in short-term fluctuations in underlying EBITDA, particularly given the continued uncertainty surrounding Brexit.”