10th Sep 2014 07:37
LONDON (Alliance News) - Shares in Sports Direct International PLC dropped Wednesday after the retailer said sales grew more than 12% in the first quarter of its new financial year, but said sales were held back by England's disappointing performance in the World Cup in June.
Sports Direct, the UK's biggest sporting goods retailer by revenue, said growth continues to be driven by its sports retail business, both online and in-store.
The FTSE 100 company said sales for the group as a whole in the 13 weeks to July 27 increased to GBP711.2 million from GBP634.0 million a year earlier, driving a 12% increase in gross profit to GBP301.2 million from GBP269.3 million.
But the retailer said sales were held back by England being knocked out in the first stage of the recent football World Cup final.
"Recent trading, including the period since 27 July, has been in line with management's expectations with some stronger weeks offset by England's disappointing World Cup performance," said Chief Executive Dave Forsey in a statement.
Sports Direct shares were trading 3.7% lower in early trading Wednesday, at 693.50 pence.
Its sports retail division, the main driving force behind the business, posted 16% growth in sales to GBP611.8 million, and a 16% rise in gross profit to GBP260.4 million.
"Within sports retail we continue to focus on upgrading our store portfolio and integrating recent acquisitions, including Eybl and Sports Experts in Austria," said Forsey.
Meanwhile sales and profits fell at both its Premium Lifestyle and Brands divisions.
Revenues from the Premium Lifestyle division, which includes its retail business Republic and USC, saw sales declined 8.8% to GBP52.1 million, while gross profit fell by almost 12% to GBP20.5 million, down from GBP23.3 million a year earlier.
The group's Brands division, which includes international brands such as Everlast, Lonsdale and Dunlop, saw sales fall 7.1% to GBP47.3 million. Gross profit in the division also declined by 4.7% to GBP20.3 million, compared with GBP21.3 million in the first quarter of last year.
Sports Direct holds its annual general meeting Wednesday afternoon. The retailer said it will release its interim results on December 11.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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