Shares in JD Sports Fashion rose by mid-single digits on Thursday, after the athleisure retailer released more calming financials following January’s shock profit warning.
At 123.6p per share, JD Sports’ share price was last 6.2% higher at the end of the trading week.
Revenues at the FTSE 100 retailer rose 3.6% during the 12 months to January, it said, to £10.5 billion. Like-for-like sales, meanwhile, were up 4.2% year on year.
Pre-tax profit before adjusted items is tipped to meet JD’s recently revised guidance at between £915 million and £935 million.
JD said that like-for-like sales edged 0.1% higher in the final three months of the year as tough conditions persisted in key markets.
It noted that “January was slightly down year-on-year due to elevated promotional activity in the market, particularly online, and against a very strong comparative of c.25% growth.”
Higher promotions last year caused its gross margins to fall 50 basis points from fiscal 2023, to 47.3%.
Sales Growth Varies Significantly
Today’s update comes as relief following JD’s profit warning in early 2024 that sent its share price plummeting.
The FTSE business has been under pressure from weak consumer spending that has prompted it to lift promotional activity. Sales have also been hit by adverse weather conditions more recently.
Sales were strongest in Asia Pacific last year, rising 8.1% on a like-for-like basis. Corresponding revenues in North America — the company’s single-largest market — rose 4.1% year on year.
Like-for-like turnover in Mainland Europe increased 7.7%, but in the UK and Ireland they edged just 0.8% higher.
Wide Profit Guidance For 2025
Chief executive Régis Schultz commented that “[last year] we outperformed the sportswear market, reflecting the strength of our business. We achieved like-for-like sales growth of over 4%, organic growth of over 8% and our athleisure fascias achieved organic growth of over 10%.”
While praising the company’s “good strategic progress” — it opened 215 new stores during the course of financial 2024 — he added that “the current trading environment remains challenging due to less product innovation and elevated promotional activity, especially online.”
But Schultz noted that “we anticipate trading conditions will improve as we move through the year, helped by a busy sporting summer and softer comparatives with last year.”
For the full year JD expects to record profit before tax of between £900 million and £980 million.
“Resilient Performance”
Analyst Russell Pointon of Edison Group said that JD’s update “reveals a resilient performance in the face of ongoing challenges within the retail sector.” He added that “after the group cut profit targets in January, it is now trading in line with the more reserved predictions.”
