JD Sports Fashion has reported record interim results, maintaining strong revenue growth despite economic challenges.
The company’s latest financial performance underscores its ongoing strength in the global marketplace and resilience against industry volatility.
In the six months leading up to August 3, 2024, JD Sports achieved a remarkable 6.8% increase in revenues, totalling £5.032 billion. Pre-tax profits before adjusting items rose by 3.4%, reaching £405.6 million.
However, profit before tax saw a significant decline, falling from £353.7 million to £126.3 million, primarily due to non-cash items including the closure of its Derby distribution centre.
JD Sports has significantly expanded its retail footprint, adding 1,189 new stores to its portfolio, bringing the total count to 4,506 outlets. This expansion is attributed to new openings, ongoing disposal of non-core stores, and the acquisition of Hibbett, a major American retailer.
Hibbett, which operates 1,169 stores across 36 states, was acquired in a billion-dollar deal, marking a significant milestone in JD Sports’ international development.
Régis Schultz, CEO of JD Sports, expressed confidence in the company’s future, citing the strength and agility of their global, multi-brand strategy.
He emphasised the group’s ability to adapt swiftly to fast-changing industry trends and highlighted their operational excellence.
Organic sales growth for the first half of the year was 6.4%, with underlying operating margins remaining consistent with the previous year, despite continued cost investments in long-term growth.
The company reiterated its previous profit guidance range of £955-£1,035 million before tax and adjusting items.
The company highlighted that currency headwinds, particularly the strengthening of the pound against the US Dollar and the Euro, have impacted profits. In the first half, foreign exchange impacts reduced profit before tax and adjusting items by £6 million.
It is anticipated that these effects will continue in the second half, with an expected impact of £20 million.
Dan Coatsworth, an investment analyst at AJ Bell, noted that JD Sports exhibited stronger trading in footwear compared to apparel, despite the challenging weather conditions. He emphasised that the company’s diverse brand portfolio allows it to remain flexible and capitalise on the most in-demand products.
The interim dividend saw a 10% increase to 0.33p per share, reflecting the company’s robust financial health and commitment to delivering value to its shareholders.
JD Sports’ record interim results and strategic expansions underscore its robust growth trajectory.
With continued investments and an adaptive strategy, the company is well-positioned to meet and potentially exceed its ambitious £1bn profit goal.