UK: JD Sports posts 28% FY profit rise
- FY profit up 28% to GBP78.6m
- Revenues climb 15%
- Cautious outlook
UK sporting goods retailer JD Sports has posted strong full-year profits but is cautious about consumer spending in the year ahead.
Total revenue increased by 14.8% to GBP883.7m (US$1.4bn), compared to last year, with like for like revenues increasing by 3.1%.
JD said its gross margin improved to 49.5%, from 49.3%. It also completed the acquisition of Sonneti, Chilli Pepper and Nanny State brands during the period.
"The year ended 29 January 2011 has been the seventh successive year of good progress in revenue and profitability for the group," said executive chairman Peter Cowgill. "Profit before tax and exceptional items improved by 21% to GBP81.6m."
For the eight weeks to 26 March 2011, JD's gross like for like sales rose 0.4% but net sales have declined 1.2%.
In its outlook, the company issued caution but said opportunities for profit growth overseas and development of own brands would help reduce current threats to profitability.
"Following successive years of record results for the Group, the retail environment has recently been significantly impacted by adverse fiscal changes in addition to the multiple current economic pressures," it said.
"Specifically, the increase in VAT for the year to 28 January 2012 means that the same level of gross takings will produce a contribution of approximately GBP16m less than the previous year.
"Simultaneously, but quite separately, we anticipate a reduction of real expenditure levels by consumers at a time when product costs, particularly imported goods, are increasing at a material rate."
Click here to view the company's financial results in full.
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