Sports Direct has refused to be drawn in to the controversy over the loan its founder Mike Ashley gave to JJB chairman Sir David Jones as it scrapped its final dividend following a fall in underlying profit of 20.2 per cent.
In its full year to April 26, group revenue grew 8.6 per cent to £1.4bn. Reporting the group’s first ever like-for-like sales figures, the retailer said that its “like-for-like gross contribution” in the UK was 2.5 per cent ahead for the year.
Underlying profit before tax was £68.2m and reported pre-tax profits slumped 91 per cent to £10.7m. EBITDA fell 8.9 per cent to £136.8m.
The weak pound hit gross margin, which fell 280 basis points to 40.8 per cent.
Sports Direct chief executive Dave Forsey said: ”The second half of the year remained challenging, but we are pleased with these solid full-year results that reflect the resilience and relevance of our flexible business model, focused on the core principles of retailing.”
In a conference call this morning Forsey would not answer any questions on the £1.5m loan Ashley leant to Jones – which raised a furore over conflict of interest issues – and said: “We can only answer questions on the business, not anything to do with Mike.”
Ahead of the results, Investec raised 10 questions over corporate governance and business disclosure issues. When challenged on the question of why the company has stilll not appointed an independent chairman and replaced departed non-executive directors, Forsey said: “The board is operating extremely well and we will keep it under review.”
Forsey said that in its current financial year Sports Direct expects EBITDA to be at least £140m.
Forsey said that the group saw strong opportunities ahead, including the 2010 Football World Cup and said that its international business also lent itself to strong growth opportunities.
International retail revenue for the year was up 32.3 per cent to £102.3m.
The retailer ended the year with net debt of £431.3m, and pledged to reduce that debt to below £400m this financial year.