JD Sports Fashion expects to feel little impact from the VAT rise in January and has posted a surge in first-half profits.
Chief executive Barry Bown said JD, which runs the Bank and Scotts chains, as well as eponymous shops, was less likely to be affected than retailers of big-ticket items.
“The main thing is making sure that you get your pricing right,” said Bown. He said straightforward application of the increase could result in prices that would look odd to shoppers and JD would avoid it.
JD reported a 64% rise in interim profits to £16.6m on sales up 18.5% to £383.9m. Group like-for-likes rose 2.8%. A 3.9% rise at the sports division was counterbalanced by a 3.8% decline at the fashion fascias.
The profit rise reflected improvements at the fashion arm, where better housekeeping and enhanced product proposition helped a 300-basis point improvement.
The second half began well, with a 7.1% like-for-like rise at fashion stores and a 2.1% advance at the sports fascias in the four weeks to August 28.
Bown said JD would continue to assess opportunities for expansion following last year’s acquisition of French retailer Chausport. It aims to open two eponymous shops in France within the next month or so. Bown said JD, with bigger, urban shops, would complement Chausport, which is family-oriented and has a provincial estate.
Broker Singer said: “JD is extremely well managed, with significant growth opportunities.”