JD Sports Fashion plc, the Bury-based FTSE 100 retailer, said it increased dividends paid in the year to February 1, 2025, to £52 million, as group revenue rose 8.7% to £11.458 billion.
JD Sports had 4,871 stores worldwide at May 3, 2025.
Profit before tax fell 11.8% to £715 million, due partly to an increase of £53 million in adjusting items. Total proposed dividend is up 11.1% to 1p.
The company’s shares fell about 9% to 84p to give the firm a current stock market value of £4.3 billion.
JD Sports CEO Régis Schultz outlined the group’s ongoing investment in infrastructure and people.
“A key priority for us was a need to upgrade the infrastructure, capability, governance and control environment to be fit for purpose for a group of JD’s scale and reach,” he wrote.
“The programmes to address these areas have taken longer, and cost more, than we anticipated originally. The European DC project in Heerlen has been delayed by a year leading to increased costs. On this project, we have changed the leadership and I am pleased to say we are now back on track.
“In addition, we have spent around £60m to secure and improve the resilience of our IT infrastructure and back-office systems.
“We have started the programme to put in place IT general controls, build a cyber security function and upgrade outdated or non-supported legacy systems.
“As these are accounted for increasingly as operating expenditure rather than capital expenditure, these investments result in a higher short-term impact on our P&L.
“We have also developed our Head Office functions and have seen general wage inflation, especially as minimum wages defined by laws have increased significantly across most of the markets we operate in.
“This, and our decision to remove age banding, has resulted in an additional people cost of more than £100m over the last two years. These investments are the right choices for the long-term health of the business.”
Schultz added: “We increased group revenue on a constant currency basis by 12% with organic sales growth of c.6%, more than double the market growth, thanks to our strong and agile, multi-brand model.
“We delivered a 48% gross margin, excluding the impact of acquisitions, which was in line with the previous period due to our full price commercial strategy and strong trading discipline in a promotional market.
“We concluded two important acquisitions in our key strategic markets – Hibbett in the US and Courir in Europe – while we continued to invest in our infrastructure and controls environment. In constant currency, our operating profit was ahead of last year and our operating cashflow was over £1.2bn, demonstrating our strong cash generation.
“We achieved profit before tax and adjusting items of £923m, in line with our January guidance.
“In April, we announced we were adapting our strategy to reflect slower anticipated market growth and an increased focus on profitability, leveraging the investments we have made to support our growth in the key markets of North America and Europe, delivering strong cash generation and improving returns to our shareholders.
“Our focus on increasing shareholder returns is demonstrated by paying FY25 dividends of £52m, up 11% on the previous period, and after the period end, the commencement of a £100m share buyback programme.
“Overall trading in the first quarter of the new financial year has been in line with our expectations in a volatile market. Despite this volatility, and uncertainty surrounding the impact of US tariff changes, we look forward into the medium term with confidence that we can continue to outperform the market, improve our profit margin and create significant value for our shareholders.”
REACTION:
Susannah Streeter, head of money and markets, Hargreaves Lansdown: “JD Sports results underline the tough environment for clothing retailers amid economic uncertainty. Underlying sales dipped 2% in the first quarter, in what it described as a volatile market.
“Buying a new pair of top-end trainers isn’t a priority for as many sports and fashion fans right now. Amid concerns about the vulnerability of the retail sector to cyber-attacks, JD Sports has offered notes of reassurance in this update.
“It stressed it’s spent £60 million to secure and improve the resilience of its IT infrastructure and back-office systems. Despite the weaker sales figures, there are a few rays of optimism in this update. Although the company says tariffs could hit pricing and demand, it ultimately sees no material effect from US trade policy, despite the market turmoil which was caused.
“It’s estimating that it will be able to grow organic revenue in the medium term by around 2-3%, ahead of market expectations. With an eye on its weaker share price, JD Sports has announced a £100 million share buyback programme.”