JD Sports has downgraded its profit forecast, blaming tougher-than-expected market conditions and heightened promotional activity during the peak trading period.
For the nine weeks to 4 January 2025, the fashion retailer reported organic revenue growth of 3.4%.
However like-for-like revenue fell by 1.5% across November and December in what it called a “challenging and volatile market”, though a stronger Christmas saw December LFL revenue rise 1.5%.
As a result of the tough trading environment, JD Sports now anticipates profit before tax and adjusting items to fall between £915m and £935m, down from its earlier forecast of £1.04bn.
-
Related Story
-
JD Sports CEO Régis Schultz said: “Considering the current headwinds in the market, we performed well, delivering organic revenue growth of 3.4% across the period, and a strong Christmas resulted in LFL revenue growth in December.
“In line with our proven long-term approach, we chose not to participate in what was a more promotional environment in the period than we anticipated, fully maintaining our trading discipline to deliver gross margins ahead of last year, clean inventory and strong cash management.
“While I am pleased overall with our performance, market headwinds were higher than we anticipated and therefore our full-year profit forecast is slightly below our previous guidance. With these trading conditions expected to continue, we are taking a cautious view of the new financial year.”
The retailer’s footwear sales outperformed clothing during the period, with physical stores outperforming online channels.
JD Sports also reported strong LFL growth in its sporting goods and outdoor segments, as well as in Europe and Asia Pacific, which helped offset weaker trading in the UK and North America.
Recent acquisitions Hibbett and Courir performed well, with Courir contributing £7m to the profit before tax forecast and trading strongly in the weeks following its acquisition in November 2024. Hibbett also traded slightly ahead of the wider North America business.
Click here to sign up to Retail Gazette‘s free daily email newsletter
