JD Sports Fashion’s pre-tax profits before exceptionals jumped from £2.9m to £10m in its half year as earnings soared at its sports fascia.
JD’s UK and Ireland like-for-likes increased 7.5% and operating profit before exceptionals surged 55% in the half to August 3. Group sales edged up 2% to £567.4m over the period and like-for-likes across sport and fashion increased 5.8%.
JD said that the “robust trading” continued in its sports fascias and like-for-likes across sport and fashion like-for-likes edged up 2.8% in the five weeks to September 7.
However, the retailer reported a “disappointing performance” in the half at its Blacks and Millets outdoor fascias as it only cut losses from £10m to £8.9m.
It discounted heavily to clear large volumes of autumn stock and was left with a shortage of outdoor products for spring as it had bought before it made a U-turn on its decision to close Millets.
JD said its restructuring of Blacks and Millets is now “substantially complete” and it has now relocated its Northampton warehouse and head office to the group’s facilities in the North west.
It hired former Go Outdoors chief operating officer Lee Bagnall as managing director of Millets in July after it decided to retain Milllets, backtracking on its earlier decision to ditch the fascia to concentrate on Blacks.
Like-for-likes at fashion fascias, including Bank and Scotts, dipped 2.2% over the half
The retailer hired former Asos and Arcadia executive Gwynn Milligan as managing director of Bank Fashion in July. She is now conducting a full review of Bank focusing on strengthening its proposition.
The sports retailer entered Germany in July when it acquired the trade and assets of 10 Isico Sports stores which it will convert to JD next year. It also launched in Holland after buying the stores of local retailer Setpoint when fell into administration earlier this year. It refitted seven stores as JD Sports and will open a further seven in the second half.
JD executive chairman Peter Cowgill said: “The strong overall result in the first half has been driven by a record performance in our core sports fascias in the UK. This business continues to provide the group with a very solid platform for group profitability and future cash generation. We are also pleased with the continued evolution of the JD fascia in mainland Europe.
“Elsewhere, the performance of both the fashion and outdoor fascias has been impacted by significant continued reorganisation activity in the period. Whilst these reorganisations have had a short term negative impact on the overall group results, we strongly believe that the decisive actions which we have taken were necessary for these businesses to deliver returns in the longer term.”
JD expects to deliver results that are within the range of current market expectations.