|
JD Sports Fashion PLC on Wednesday said it remains ‘cautious’ on the trading environment as it announced mixed results and said it expects a limited impact from tariffs. In response, shares in the Bury, Manchester-based sports-fashion retail company were up 0.5% at 89.04 pence each in early trading in London on Tuesday. Pretax profit increased by 9.5% to £138 million in the 26 weeks to August 2 from £126 million the year prior. On an adjusted basis, pretax profit dropped 14% to £351 million from £406 million a year ago, 4.6% below £368 million Visible Alpha consensus. Operating margin declined 6.2% from 8.0%, while gross margin fell to 48.0% from 48.6%. Revenue grew 18% to £5.94 billion from £5.03 billion, driven by its acquisitions of Hibbett and Courir during the period, beating VA consensus of £5.81 billion by 2.2%. On an organic basis, sales rose 2.7% at constant currency, helped by stronger trends in apparel and online in North America and ‘resilient’ sales in Europe. In the UK, organic sales were affected by tough second quarter comparatives due to Euro 2024 football tournament. Organic sales grew 3.1% in North America, 6.0% in Europe, 6.0% in Asia Pacific but fell 1.7% in the UK. JD Sports noted a good underlying performance in apparel globally but said footwear was softer given an ongoing shift in the product cycle. Chief Executive Regis Schultz said organic sales growth showed the ‘resilience’ of the business in what ‘remains a tough trading environment.’ ‘In an environment of strained consumer finances and evolving brand product cycles, operating and financial discipline remains a core focus for JD, and we are controlling our costs and cash well,’ the CEO added. Schultz said JD remains ‘cautious’ on the trading environment for the second half, but expects ‘limited’ impact from US tariffs this financial year. As a result, full year profit before tax and adjusting items is expected to be in line with current market expectations for around £878 million, which would be down 4.9% from £923 million the year before. Schultz highlighted supply chain investments which he claimed are ‘poised to unlock significant efficiencies’ across its global network. ‘Our new European distribution centre in Heerlen, the Netherlands, is set to launch automation for JD Europe store replenishment in the coming weeks, while our US west coast site in Morgan Hill is set to go live with JD and Finish Line by year-end - the next step of our plan to leverage our distribution centres on a multi-fascia basis,’ he noted. The company declared an interim dividend of 0.33 pence per share, unchanged on-year. In addition, JD Sports will begin its second £100 million share buyback programme ‘soon’. Copyright 2025 Alliance News Ltd. All Rights Reserved.
|
