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JD Sports on track to meet full year profit outlook

Sep 22, 2023 United Kingdom
JD Sports on track to meet full year profit outlook
The UK-based retailer reported in its interim results a strong first half performance, with a 12% year-over-over growth in organic sales, saying it's on track to achieve its full year profit outlook
“We have delivered a strong first half to our financial period with organic sales growth of 12% and profit on track for the full year. In line with our strategic plan, growth is being driven by our premium Sports Fashion business with an impressive performance in Europe (+27%) and North America (+15%), supported by a strong performance in our more mature UK market (+8%). This performance continued in the important back-to-school period”, commented Régis Schultz, Chief Executive Officer of JD Sports.

First Half Results

In the twenty-six weeks to the 29th of July, the group posted a revenue of 4.78 billion British pounds (5.50 billion euros), which reflects an increase of 8% or 7% in constant currency terms, on a comparable basis to the same period of last year. JD Sports added that its organic sales rose by 12% during the first half.

In the first half of the current fiscal year, JD Sports' gross margin contracted by 50 basis points from a similar period in the previous year to 48.0%, mainly thanks “to a more normalised promotional environment due to restored product availability”.

“In line with expectations”, said the group, first half profit before tax and adjusted items totalled 373.5 million British pounds (429.0 million euros), down by 2.6%, as compared to the same period of fiscal 2022; after incorporating the adjusted items, its profit before tax was 375.2 million British pounds (431.6 million euros).

The sporting goods retailer said that it ended the period with 3 347 stores, 43 less than at the start of the fiscal year due to the divestment of 66 non-core premium fashion stores.

Outlook

Despite being “acutely aware of how tough the macroeconomic environment is for consumers across the world”, JD Sports is still expecting a full year headline profit before tax and adjusted items in line with the current market consensus expectations of 1.04 billion British pounds (1.20 billion euros).

The UK-based retailer also reported that in the past seven weeks, its organic sales grew by 10% year-over-year at constant exchange rates.


Image Credits: theinvestmentobserver.co.uk

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