JD Sports has warned it would remain cautious about trading through the rest of the fiscal year as sky-high inflation crimps consumer spending, although the Bury based sportswear retailer reaffirmed its annual profit outlook.
The sportswear chain posted an 18% drop in pre-tax profits to £298.3 million for the six months to July 30 and said the results were at the top end of its expectations, with the reduction on last year’s profits partially driven by supply chain disruption affecting international brands and dragging down stock of its key footwear styles.
“Given the widespread macroeconomic uncertainty, inflationary pressures and the potential for further disruption to the supply chain with industrial action a continuing risk in many markets, it is inevitable that we remain cautious about trading through the remainder of the second half,” JD Sports said in a statement.
Its sales in the UK, principally online, initially softened in August and early September as customers were slow to take up heavier autumn products while the weather remained relatively warm.
Sales were particularly strong in the summer as a result of more people going on international holidays, although trade slowed in August and early September as shoppers held back on buying clothes for the autumn season while the weather stayed warm, JD said.
JD’s non-executive chair Andrew Higginson said: “Whilst the overall performance continues to be encouraging and the result for the half year was at the upper end of the board’s expectations, it must also be recognised that the most material trading periods lie ahead.
JD Sports revealed on Wednesday it had agreed to pay £5.5 million to former boss Mr Cowgill after he stepped down when the retailer was fined £4.3 million by the UK’s competition watchdog for sharing commercially-sensitive information with Footasylum, the rival it was seeking to buy..
Mr Cowgill will take home £3.5 million over two years as part of an exit agreement preventing him from taking a new job at a competitor company or advising similar brands.
