• H1 pre-tax profit climbs to GBP16.5m (US$26.9m) 
  • Group sales grow 27%
  • Margin narrows to 47.6%

JD Sports Fashion saw its share price climb over 4% in early trading as the UK retailer revealed a "record" set of first-half results that beat market expectations.

The group saw pre-tax profit soar to GBP16.5m (US$26.9m) from GBP6.09m a year earlier in the 26 weeks ended 2 August, with particularly strong progress made at its UK and European sports fascias.

Before exceptional items, pre-tax earnings increased by 100% to GBP20m, beating Cantor Research predictions of GBP16.5m.

Momentum picked up at JD Sports' Outdoor arm, which has seen the launch of a new brand in Ultimate Outdoors. Operating losses narrowed to GBP5.6m from GBP8.9m a year earlier.

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

"Fashion continues to be a difficult for JD, with the group evidently still trying to refine and perfect its offer," noted Greg Bromley, consultant at Conlumino. "At its existing fascias, Scotts performed well, but Bank less so.

"Despite boasting a host of fashion brands, JD has also sought to diversify its fashion offer further with the launch of its new menswear fascia, Open. [But] despite having a sensible strategy in place for Open, we would question the logic of the group to open a further fashion brand when it is evident there are still some structural issues that need to be addressed at its existing brands."

Group sales in the period climbed 27% to GBP721.4m, while gross margin narrowed slightly to 47.6% from 48.8% a year earlier.

Nonetheless, JD executive chairman Peter Cowgill, 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 fascias...as 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."

JD Sports share price was up 4.29% to 425.50 pence at 09:04 BST.