This morning, JD Sports Fashion astonishingly reported record interim results, reaffirming its trajectory towards surpassing a £1bn profit for the complete fiscal year.
The renowned Bury-based retail giant witnessed a remarkable 6.8% surge in revenues, reaching £5.032bn during the six months ending August 3, 2024, signifying its resilient market presence.
Revenue and Profit Performance
JD Sports Fashion has disclosed an exceptional 6.8% increase in revenues for the first half of the fiscal year, escalating the total to an impressive £5.032bn. This growth, achieved amidst global economic volatility, underscores the retailer’s strategic market adaptability.
The group reported a pre-tax profit, before adjusting items, of £405.6m, showcasing a 3.4% year-on-year enhancement. However, when considering non-cash items like the closure of its Derby distribution centre, the profit before tax experienced a 64.3% decline, dropping to £126.3m.
Expansion and Store Portfolio
Further solidifying its market presence, JD Sports expanded its store portfolio by 1,189 outlets, summing up to a total of 4,506 stores globally. This includes new openings and the strategic acquisition of Hibbett, an American retailer with 1,169 stores across 36 states.
Additionally, JD Sports is set to inaugurate a new store in Stockport, occupying a substantial 13,000 sq ft of the former BHS building in the Merseyway shopping centre.
Dividend Increase and Cash Flow
The interim dividend saw a significant 10% rise from the previous period, reaching 0.33p per share. This increment reflects JD Sports’ robust financial performance and strong cash generation.
Despite considerable investments in new stores and acquisitions, JD Sports reported net cash before lease liabilities of £40.8m, demonstrating their solid financial stability.
CEO Insights and Strategic Vision
Régis Schultz, the Chief Executive Officer of JD Sports, expressed immense pride in the reported record interim results. He attributed this success to the retailer’s deft multi-brand strategy and operational excellence, which enable swift adaptation to global market trends and fortify their industry-leading customer proposition.
Schultz highlighted the milestone acquisition of Hibbett as crucial to JD Sports’ international development. He is confident about the group’s growth plans in North America, considering it pivotal for capturing a larger share in the global sportswear market.
Currency Impact and Profit Forecast
The group acknowledged experiencing currency headwinds due to the strengthening pound against the US Dollar and Euro. This fluctuation impacted profit before tax and adjusting items by £6m in the first half, with an estimated £20m impact expected in the second half.
This currency impact aside, JD Sports reaffirmed its full-year profit forecast, projecting a range of £955-1,035m, factoring in contributions from the Hibbett acquisition and its associated acquisition facility costs.
Investment in Long-term Growth
JD Sports has continuously invested in its long-term growth strategy while maintaining steady organic sales growth of 6.4% in the first half. These investments ensure future sustainability and growth in its operations, despite ongoing cost pressures.
The retailer continues to focus on delivering value for its shareholders through strategic investments and maintaining strong operational foundations.
Trading Performance
JD Sports confirmed that its trading performance for the first half aligns with earlier projections. The company anticipates Hibbett to contribute approximately £25m to the profit before tax and adjusting items for the entire year.
JD Sports Fashion’s record interim results and strategic acquisitions clearly position the company for sustained growth.
The retailer’s adept strategies and strong financials ensure it remains on track to achieve its ambitious £1bn profit target, reinforcing its dominance in the global sportswear market.
