After seeing a substantial increase in sports retail profits over the last year, JD Sports now has the opportunity to push ahead with developing its concept in Europe, analysts have said.

The UK sportswear retailer yesterday (18 September), saw its share price climb over 4% in early trading after revealing a "record" set of first-half results that beat market expectations.

Results benefited from a significantly increased contribution from the Sports Retail division and lower Outdoor losses.

Pre-tax profit soared to GBP16.5m (US$26.9m) from GBP6.09m a year earlier, with particularly strong progress made at its UK and European sports fascias. The Sports Retail results increased by 34% to GBP34.8m, boosted by good results in all regions, UK and Europe with like-for-likes up 13%.

Cantor Fitzgerald analysts noted: "After seeing a substantial increase in Sports Retail profits over the last year, the company now has the opportunity to push ahead with developing the concept in Europe, where it has now moved beyond the test phase.

"This expansion should ensure that earnings continue to grow by more than 10% per annum over the next three years and makes it easier for management to put a time limit on the turnaround of the fashion fascias."

Fashion remains a point of concern for the group, registering another disappointing performance, analysts said. Operating losses widened to GBP8.2m from GBP6.8m last year.

Cantor, however, revised upwards its full-year pre-tax profit forecast to GBP84.5m from GBP84m, although it noted the company's reference to "difficult comparatives" in the second half, and for the following year to GBP98m from GBP96m.

Nonetheless, JD executive chairman Peter Cowgill, yesterday offered an upbeat outlook for the remainder of the year.

"The board recognises the demanding comparatives of the second half of the last financial year, particularly in the core UK and Ireland Sports well as our significant dependence on Christmas trading, but following the robust performance of the business in the first half, [we] believe the group is well-positioned to deliver results towards the upper end of current market expectations."