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Robust operating profit at fashionwear retailer JD Sports

16
Apr '12
JD Sports Fashion Plc, the leading retailer and distributor of branded sportswear and fashionwear announces its Preliminary Results for the 52 weeks ended 28 January 2012.

Despite a loss of £2.2m from the newly acquired Blacks business, group profit before tax and exceptionals exceeded consensus market expectations.

Significant investments give the Group the platform for future development:
- Acquisitions in Ireland (Champion Sports) and Spain (Sprinter) have continued the international expansion of the Sports Retail concepts. A further two JD stores have been opened in France during the year and the first JD store in Spain opened in late March 2012.
- Acquisition of brands and agreement for exclusive brand licences have continued.
- Additional personnel and associated costs in International Retail, Brands & Licensing and Multi-Channel development.
- New centralised warehouse for the Group's UK retail operations to be fully operational by Summer 2012.

A robust operating profit and gross margin performance was achieved given the well documented market headwinds and scale of investment activity undertaken in the year:

- Group gross margin decreased from 49.5% to 49.2% due to the impact of the acquired businesses.
- Excluding the impact of these acquired businesses the margin in the like for like businesses increased by 0.2% to 49.7%.

Peter Cowgill, Executive Chairman, said:

"During the period, we have invested significantly in brands, businesses and infrastructure to strengthen the platform for future development of the Group. Despite the continued difficult trading conditions across our markets, we are pleased to report some positive results within the Group, particularly from our mainland European businesses.

"Whilst we expect some improvement in consumer confidence from the forthcoming international sporting events, we remain cautious. Trading in the early part of the current financial year has been satisfactory in the core UK and Ireland fascias with net like for like sales for the 9 weeks to 31 March 2012 of +1.2% (Sports Fascias +1.0%, Fashion Fascias +2.3%). Margins remain under pressure as consumers continue to be offer driven.

"The Group is exceptionally well positioned with its retail proposition, financial resources and management experience to take advantage of any opportunities both in the UK and internationally. Whilst the Board recognises that current expansion activity is likely to impact returns in the short term, it remains confident that the Group is being positioned to deliver longer term earnings growth and increasing shareholder returns."

JD Sports Fashion Plc


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