Despite the “strong start” of FY15, JD Sports warns on weak euro
loading...
Business |ANALYSIS
JD Sports said it has made a “strong start” in the first 19 weeks of its current fiscal year despite tough comparatives with last year. However, the fashion group warned how negatively weak euro will affect its figures.
In a trading update ahead of its annual general meeting Wednesday, the apparel group said the company was pleased with the growing level of sales in Europe. The company reported record annual pre-tax profits of 100 million pounds in April.
JD Sports warns on weak euro effects yet on track to meet its own profit guidance
“Whilst we are now trading against challenging comparatives for the remainder of the year, the board remains confident that current earnings expectations for the year ended 31 January 2016 should be met,” summed up Executive chairman, Peter Cowgill.
Looking ahead, the fashion group cautioned that the weak euro will dent margins at JD stores outside the UK.
"The Board is pleased that the Group has made a strong start in the first 19 weeks of the new financial year. We remain pleased with the growing level of sales in Europe although the weak Euro will impact our margins in our JD stores outside the UK,” reassured the market the company.
On the wake of the news, JD Sports Fashion PLC (LON:JD)‘s stock had its ‘buy’ rating restated by research analysts at Beaufort Securities in a report. Likewise positive, analysts at N+1 Singer reiterated their ‘hold’ recommendation on the stock and set a 655 pence price target on shares of JD Sports Fashion PLC in a research note on Wednesday.
Analysts at Investec meanwhile raised their price target on shares of JD Sports Fashion PLC from 680 to 730 pence and gave the company a ‘buy’ rating in a research note on Wednesday.
Market has forecast profits of circa 108 million pounds. JD Sports is also narrowing down losses at its owned brands Millets and Jacks, cutting the red in 3.1 million pounds to 4.9 million pounds. In this vein, earlier this week analysts at Investec estimated that losses will narrow further this year to 800,000 pounds.