JD Sports to cash out on World Cup

In a trading statement issued Tuesday, British athletic apparel retailer JD Sports Fashion said it expects to deliver a “satisfactory” rise in first-half profits thanks to a sales boost prompted by the World Cup. The Manchester-based retailer explained that the build-up to the football

world championship in Brazil had helped trading at its sports stores over the 18 weeks to June 7. Despite not publishing like-for-like figures as “at this stage would be potentially misleading”, the company assured that “However, we are certainly pleased with the underlying performance of this segment in the period to date.”

The group is due to report its first-half results on September 17.

JD Sports will see H1 sales lifted by World Cup

"Based on the trading performance to date we anticipate a satisfactory increase in first half profitability in line with our expectations," the company said in a statement covering the 18-week period ended June 7.

On the back of the news, analysts at Investec who were forecasting a plain full-year profit for JD Sports, admitted that their forecast may now prove conservative given Tuesday's trading statement, saying a good England performance could result in even further upside, reported Reuters.

"While early in the year, we are encouraged by management’s cautious optimism, particular in its core Sports fascia. A ‘successful’ World Cup, typically driven by the longevity of England’s performance, would be the icing on the cake," said Kate Calvert, analysts at Investec, in a research note after JD Sports Fashion released its trading statement Tuesday.

"Whilst Fashion continues to experience a varied performance, there are encouraging signs for the future," the company said. The group's fashion business, which includes brands Bank and Scott, remains the company's biggest problem due to its increasing trading losses.

As per the company's CEO Peter Cowgill's explanation in April, the fashion business continues to be hit by the consumer shift in the youth fashion sector to online fast fashion retailers, such as Asos PLC, as well as a competitive UK retail sector.

On a positive note, the restructuring and turnaround of its outdoor division, which includes brands Blacks and Millets, continues to progress, with the company saying in April it finally reached break even for its outdoor business in the second half of its last financial year.

JD also owns outdoor goods chains Blacks and Millets, along with a controlling stake in Edinburgh-based Tiso, and said sales in this part of its business were making “positive progress against weak prior year comparatives”.

 Angela González Rodríguez