JD Sports’ has revealed a staggering 82% jump in first half profits.
The weak euro, which has been harmed by excessive bond buying by the European Central Bank, reduced the label’s margins outside of the UK compared to previous years.
Executive Chairman Peter Cowgill warned that this will only get worse: “The financial impact of this may currently be small in the context of overall earnings but it is an escalating issue as we expand our presence in Europe…”
The sports-fashion retailer opened up 27 new stores across Europe during the interim. “We are maintaining a long term view on our European development project and will continue to address the issue both internally and externally with our international brand partners,” added Cowgill.
The company also cautioned on the potential impact of the Living Wage on profits, as have many other prominent industry names. The Living Wage, which will replace the current minimum wage for people ages 25 and over in April 2016, has drawn criticism from big retailers, who claim they will have to respond by either raising prices or cutting jobs.
Cowgill’s message overall was one of cautious celebration, citing that the “organic growth that we have seen over the last two years are unlikely to continue indefinitely.”
However, he assured investors that the business will continue to invest in the “multi-channel retail proposition and driving improved buying, merchandising and retailing disciplines,” all of which have contributed to JD’s current record breaking success.