JD Sports revenues soar 27 percent in the first half

REPORT_ JD Sports Fashion, announcing its interim results for the 26 weeks

ended August 2, 2014 said that the total group revenue increased by 27 percent to 721.5 million pounds (1,174.5 million dollars). Group gross margin decreased in the period from 48.8 percent to 47.6 percent.

Group operating profit (before exceptional items) for the period more than doubled to 21 million pounds (34.1 million dollars) following an exceptional performance in Europe and a significant reduction in losses in outdoor. Group expects further progress in outdoor in the second half.

Commenting on the positive financial development, Peter Cowgill, Executive Chairman, said, “The Group has delivered record results for the first half with encouraging progress in the principal areas of the business, notably our UK and European sports stores. I am also pleased with the positive progress in our outdoor business, particularly since the move to our central facilities was only completed in July last year. Fashion continues to disappoint, albeit trading more positively in the second quarter. The second half of the year is traditionally stronger for the fashion fascia.

“The Board recognises the demanding comparatives of the second half of the last financial year, particularly in the core UK and Ireland Sports fascias where like for like sales increased by 11.2 percent, as well as our significant dependence on Christmas trading but following the robust performance of the business in the first half believes that the Group is well positioned to deliver results towards the upper end of current market expectations.”

Sport has had an excellent first half with operating profits (before exceptional items) increased to 34.8 million pounds (56.6 million dollars) with positive momentum in all of the territories. Sport continues to be the focus of investment for the group and, while international development is a key priority, company will continue developing the JD fascia in the UK and Ireland as well.

On the international front, company increased presence in France and after opening a further four JD stores it had 21 stores open at the end of the period. Plans are now in the pipeline to open up to five further stores in France in the second half. It could also open two new stores in the Madrid, Spain in the second half. Performance of its stores in Holland was also encouraging. It had a successful start in Rotterdam, which further encouraged the company to expand presence in the country by opening a store in Den Haag. The Isico stores in Germany, which the company acquired in July 2013 have now all been converted to the JD fascia. Company also opened two small new stores during the period. Country specific JD websites in each of the international territories have also been launched, where the company enjoys retail presence.

The operating loss (before exceptional items) in fashion increased in the period from 6.8 million pounds (11 million dollars) to 8.2 million pounds (13.3 million dollars). Scotts performed well in the first half. The operating loss in outdoor has reduced from 8.9 million pounds (14.5 million dollars) to 5.6 million pounds (9.1 million dollars) with considerable progress made in Blacks and Millets. Tiso, which was acquired in November 2013, made a small loss in the period which in line with expectations.

Company will provide an update on trading in its interim management statement which would be released before December 19, 2014.