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JD Sports acquisitions see PBT plummet 18.3%


Sporting goods and clothing retailer JD Sports Fashions has seen profit-before-tax plummet 18.3 per cent to £55.1 million in its full financial year as recent acquisitions affected returns.

In the 53 weeks ended February 2nd 2013, the group’s outdoor retail arm, which includes retailers Blacks and Millets which were acquired last January, reported an operating loss of £14.9 million, though the group noted that the implementation of new management and stringent stock controls had seen perform begin to improve.

Commenting on the figures, JD Sports Fashion Executive Chairman Peter Cowgill noted: “Whilst the Board recognises that recent acquisition activity has impacted on short term returns, it remains confident that the Group is well positioned to deliver earnings growth and increased shareholder returns over the longer term.”

While no definitive figure was given for outdoor like-for-like sales, JD Sports said in a statement that these had “benefitted significantly both from the recent sustained cold weather and a sustained clearance programme from January through to March.”

Overall LFLs grew 1.2 per cent over the year while group sales jumped 18.8 per cent, highlighting the chasm in popularity of its varied products, though its traditional sports fascias helped buoy overall performance.

Sports retail reported an operating profit of £77.8 million while LFL rose 2.5 per cent over the year and, in the nine weeks to April 6th 2013, sport has seen a boost of 1.9 per cent, the only category to have reaped positive results in that period.

Meanwhile, the group’s fashion business saw LFLs dip 4.1 per cent in the full year as Bank reported a 4.9 per cent decline, while Scotts LFLs fell 0.5 per cent.

However, the group reported a 0.5 per cent rise in LFLs in the UK & Ireland, where its JD offering continues to fare well, increasing operating profit over the year by £4.7 million.

Cowgill concluded: “The core sports fascias in the UK continue to produce excellent results and provide the group with a very solid foundation for ongoing profitability and cash generation.

“We are pleased overall with the start we have made to the new year.

“A very considerable amount of reorganisation in both outdoor retail and our warehousing and distribution operations is now behind us and this should benefit trading in the balance of the year.

“The group is exceptionally well positioned with its retail proposition, financial resources and extended management experience to take advantage of opportunities both in the UK and internationally.”

Published on Wednesday 17 April by Editorial Assistant

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