JD Sports has warned that it remains “cautious” about trading in the coming months as rising inflation and worker strikes threaten to curb consumers’ purchasing power and disrupt its supply chain.
The sports retailer said that although sales in the past six weeks were 8% higher than a year earlier, it was aware that rising prices linked to a rise in energy costs could hit its profits as Buyers reduce their spending.
The group said it was also taking “necessary steps” to offset its own costs, including improving energy efficiency at all of its sites.
“Given widespread macroeconomic uncertainty, inflationary pressures, and the potential for further supply chain disruption with industrial stocks an ongoing risk in many markets, it is inevitable that we will be cautious on trading for the remainder of the second half,” JD Sports said. .
However, it said it still expected full-year pre-tax profit, before one-off costs, to be in line with the record annual performance it reported in January.
The retailer reported a 19% drop in pre-tax profit to £298m for the six months to July, in part due to the US government support it received as part of the country’s Covid stimulus package last year. past, which boosted comparable earnings.
Its chairman, Andrew Higginson, welcomed a 5% rise in global retail sales over the period, saying the figure was encouraging amid tight supplies and difficult economic conditions.
“This year is expected to follow a more normalized business pattern, this result is at the high end of our expectations for the first half, demonstrating the continued resilience of our global proposition and the strength of our commitment to the consumer,” said.
He added that while it was a “transition period” for the board, “it is reassuring that this has not affected the financial performance of the group, which continues to deliver strong results.”
Sign up to business today
Get ready for the workday – we’ll tell you all the business news and analysis you need each morning.
Notice of Privacy: Newsletters may contain information about charities, online advertisements, and content funded by third parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply.
His comments refer to the resignation of former boss Peter Cowgill in May. The 69-year-old resigned after the competition regulator fined JD more than £4m for holding clandestine meetings with the head of his takeover target FootAsylum, including one caught on video in a car park near Bury in Greater Manchester.
JD confirmed on Wednesday that it had reached an agreement to pay Cowgill a “golden farewell” of £5.5m over three years, on top of a year’s salary worth more than £906,000 and a potential bonus. of up to £450,000, as part of a deal to prevent him from setting up a rival retailer.
Source: news.google.com