Bury-based FTSE 100 retailer JD Sports Fashion plc reported higher sales and adjusted profit for the latest six-month period, helped by a surging US sports market.
In the 26 weeks to 3 August, the company reported revenue of £5.032 billion, up 5.2% up from a year ago. Operating profit before certain items was £451.1 million, 6.7% from a year ago. Including some impairments and acquisition costs, operating profit was £292.2 million, down 22% from a year ago.
The company said trading performance in the first half was in line with its expectations and held its guidance range of £955 million to £1.035 billion in profit before tax and certain items for the full year.
Régis Schultz, Chief Executive Officer, said: “We have today reported record interim results with Group revenue of £5.0bn, and Profit before tax and adjusting items of £405.6m, underscoring our ability to outperform the sector in a volatile global marketplace.”
“Organic sales growth in the first half was 6.4% and our underlying operating margins were in line with last year, notwithstanding continued cost investment in our long-term growth. We are reiterating our previous Profit before tax and adjusting items guidance range of £955-1,035m.
“Our acquisition of Hibbett, Inc, which completed just before the period end, is a key milestone in our international development and advances the global nature of the Group through our strengthened position in the US. I remain confident in the delivery of our exciting growth plans for North America and that the Group is well positioned to continue growing share in the world’s largest sportswear market.
Aarin Chiekrie, equity analyst, Hargreaves Lansdown, said: “After a tough period of volatile conditions and missing market expectations, JD Sports looks to be back on the front foot. Recent retail sector data had pointed to increased discounting at shops to help keep the tills ringing. While that’s good news for customers, it’s not typically good for retailers who tend to feel the effect of increased price cuts on their profit lines. But filling the racks in JD’s stores are exclusive items from the likes of Nike and Adidas.”
Richard Hunter, Head of Markets at Interactive Investor, said: “JD Sports has reported some record numbers as the appeal of its multi-brand offering and its geographical diversification both continue to flourish.”
“Perhaps the most exciting and obvious opportunity in the medium term is JD’s growing brand presence in the major US market. In the period, the group completed the £900 million acquisition of US retailer Hibbett, which should further propel brand awareness, especially in the southeastern corner of the country. North American revenues already account for 35% of the group total, and once Hibbett is fully integrated, this is expected to rise to 40%, also raising the full estate by 1,179 to 4,506 stores.”