7th Jul 2020 09:08
(Alliance News) - JD Sports Fashion PLC on Tuesday said its annual profit was slightly higher amid a strong sales growth, especially from its core fascias, but said footfall in its recently reopened stores has suffered as customers avoid busy areas.
The FTSE 100-listed sports fashion retailer reported a GBP348.5 million pretax profit for its financial year ended February 1, up 2.5% from GBP339.9 million the year before.
Lancashire-headquartered JD Sports posted a 29% increase in revenue to GBP6.11 billion from GBP4.72 billion thanks to a strong 12% like-for-like sales growth from global Sports Fashion fascias, including more than 10% growth from its core UK & Republic of Ireland Sports Fashion fascias.
However, higher selling and distribution and administrative expenses meant that the profit increase was far less dramatic.
Going into financial 2021, Covid-19 is still hurting commercial operations and is expected to "have a material impact on the group's results for the period to 30 January 2021".
By March 21, the company had full closure of its retail portfolio in 14 countries, accounting for over 98% of its physical store estate. Online trading stayed open in most territories and was "very resilient during the closure period".
Since stores started re-opening in late April, more of JD Sports' stores are trading once more but initial footfall has weakened in shopping centres and malls, especially in Northern Europe at weekends with customers still nervous of the risks from "densely packed enclosed spaces".
However, this lower footfall has been partly offset by an increase in conversion, since customers are "less inclined to browse" at present.
However, in light of "current highly unusual circumstances" no final dividend will be paid, the prior year's payout having been 1.44 pence per share. This means total dividend payable per ordinary share for financial 2020 was only 0.28p per share, down from 1.71p per share in financial 2019.
Executive Chair Peter Cowgill said: "We were encouraged by the continued positive trading in the early weeks of the year prior to the emergence of Covid-19 and we firmly believe that we are well placed to regain our previous momentum.
"Looking longer term, there is inevitably considerable uncertainty as to what the effect of Covid-19 will be on consumer behaviour and footfall with future store investments highly dependent on rental realism and lease flexibility. Ultimately, however, we remain confident that we have a market leading multi-channel proposition which has the necessary flexibility and agility to prosper within a retail environment that may see profound and permanent structural change."
Shares in JD Sports were up 0.01% at 674.72p in London on Tuesday morning.
By Anna Farley; [email protected]
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