JD Sports hails record profits as its key customers buoyed by jobs market

JD Sports has reported record-high profits and revenues as the sportswear retailer steamed ahead with global expansion
JD Sports has reported record-high profits and revenues as the sportswear retailer steamed ahead with global expansion

SPORTSWEAR chain JD Sports Fashion has reported record profits and revenues as the retailer steamed ahead with its global expansion plans and upped its prices.

The retailer's boss said its key customers are more likely to have jobs and are therefore more cushioned from the impact of rising living costs.

It reported a profit before tax and adjusted items of £991 million in the year to the end of January, compared with £947 million the prior year, which it said was a record result.

Its revenues jumped above £10 billion for the first time, up from £8.6 billion the prior year, driven by sales growth of more than a tenth over the year.

Chief executive Regis Schultz, who took the top job in September last year after the departure of Peter Cowgill, said sales volumes went up in the latest year as more items were sold.

However, he revealed that average prices across its products were between 5 per cent and 10 per cent higher than the previous year, which also helped lift revenues.

JD clothing is an "affordable luxury" for its buyers, Mr Schultz stressed.

"Our key target customer is the young adult, and the young adult all over the the world is benefiting from low unemployment, and I think that is driving the morale and the revenue of our key customer."

Its key buyers have more money to spend because they can more easily find a job today than they could three years ago, he said.

He added: "Our sneaker is the new normal for footwear, and you can see that in the streets, where about 80% of shoes are sneakers - which are much less expensive than formal shoes."

Mr Schultz also said he "embraces competition" from rival retailers, such as H&M and Asos expanding their sportswear ranges, adding that JD is growing online where others are not.

Last month, JD outlined ambitious growth plans to open up to 350 shops globally each year, focused in North America and continental Europe.

It has been growing rapidly in the US, including adding a flagship store in Chicago, and had 58 net new store openings across Europe such as in Hungary and Greece.

However, including costs such as from JD's previous acquisitions, its pre-tax profit declined by more than £200 million to £441 million over the year.

JD said it was encouraged by the resilient nature of consumer demand but remains "conscious of the headwinds that prevail" including global economic and political concerns.

Andrew Higginson, JD's chairman, commented on the group's financial results: "This is a record result for the group and I must pay tribute to the skills, resilience and positive attitude of the colleagues in our businesses who have not let the leadership changes distract from their focus on the consumer and our offer.

"Whilst we are encouraged by the resilient nature of the consumer demand in the current period to date, we remain conscious of the headwinds that prevail at this time including the general global macro-economic and geopolitical situation.

"Against this backdrop, assuming current exchange rates, we expect that the group's headline profit before tax and adjusted items for the 53-week period ending February 3 2024 will be in line with the current average consensus expectations of £1.03 billion."