JD Sports Fashion defies the gloom as festive sales rise
JD Sports Fashion defied the retail gloom today as it reported a 2.8% hike in like-for-like sales over the Christmas trading period.
Shares surged 40p or 19.5% to 245p on the news.
The Bury company, which has been one of the star performers on the high street in the last three years, continued to out-perform expectations over the festive period, and told the City that annual profits will be now be above targets.
Executive chairman Peter Cowgill told TheBusinessdesk a late surge in sales had been behind the strong performance.
“We left it late this time – with two weeks to go before Christmas it was looking a bit black, but we recovered well and we had a great Christmas week.We carry on surprising ourselves really,” Mr Cowgill added.
He said the key to the group’s strong showing had been exclusive ranges with Nike and Adidas, strong own-label brands such as Mackenzie and Cabrini and most importantly from a profitability point of view, not discounting too early.
JD did not begin its sale until Boxing Day – unlike some of its key rivals.
Like-for-like sales for the five weeks to January 3 rose 2.8%, with sales in the core JD Sports business up 1%, but 12.5% in the Bank fashion division.
The company said so far this financial year its like-for-like sales for the 48 week period to January 3 are up 3.8% on last year, with margins higher too.
“The Board now believes that current market expectations for profit before tax and exceptional items will be marginally exceeded,” JD said in a trading statement.
Asked about the woes of Wigan-based rival JJB Sports – which last week revealed a big management shake-up after a collapse in its share price amid poor trading and concerns over its finances – Mr Cowgill said: “Am I an interested party in them? Yes. Am I looking at it aggressively? No.”
Mr Cowgill said he had not been surprised to see former Next supremo Sir David Jones and ex Selfridges boss Peter Williams brought into executive roles at JJB: “I think the changes had a certain degree of inevitability about them. I think when the share price goes down to 2p the market expected it to disappear, but they managed to get an agreement from the banks.”
JD took a 10% stake in JJB last autumn.
