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JD Sports profit jumps 19 per cent as foreign sales surge
[BENGALURU] JD Sports reported an 18.7 per cent rise in first-half earnings on Tuesday, as demand for its sportswear rose and it expanded overseas, helping it overpower what it called "retail challenges" in its UK home market.
Britain's biggest sportswear retailer has been looking abroad to boost profit this year, opening 39 stores in Europe and Asia and buying US-chain Finish Line as it worried over the impact on UK consumer sentiment of slow wage growth and next year's planned exit from the European Union.
Overall revenue at the firm grew 35 per cent in the 26 weeks to Aug. 4 compared to the equivalent period a year ago, with like-for-like store sales up 3 per cent. It said sales in the second half had continued at similar levels to the first half.
"Against a backdrop of widely reported retail challenges in the UK, it is extremely reassuring that the profitability in the UK and Ireland Sports Fascias has been further enhanced," the company said in the half-year report.
"We are well positioned to deliver an outturn in line with current market expectations which, including a part year from Finish Line, range from £337 (S$605) million to £345 million."
While UK retailers have been hard hit by lower consumer spending, JD Sports has fared well, partly owing to growth in "athleisure" - sportswear worn when not playing sport.
By market capitalisation, it is more than twice the size of rival Sports Direct and now operates roughly 1,500 stores in 16 countries.
Profit before tax rose to 121.9 million pounds (S$218.74 million), for the 26 weeks ended August 4, from 102.7 million pounds reported a year earlier.
Revenue rose to 1.85 billion pounds for the six-month period. Finish Line, bought for US$558 million in March, contributed revenue of 180 million pounds and a profit before tax of 3.5 million pounds to the first half results.