JD SPORTS FASHION PLC
UNAUDITED INTERIM RESULTS
FOR THE 26 WEEKS TO 29 JULY 2023
JD Sports Fashion Plc (the ‘Group’), the leading retailer of sports, fashion and outdoor brands, today announces its interim results for the 26 weeks ended 29 July 2023 (comparative figures are shown for the 26-week period ended 30 July 2022).
DELIVERING ON OUR STRATEGY; STRONG SALES GROWTH & PROFIT ON TRACK
Commenting on the results, Régis Schultz, Chief Executive Officer of JD Sports Fashion Plc, said:
“We have delivered a strong first half to our financial period with organic sales growth1 of 12% and profit on track for the full year. In line with our strategic plan, growth is being driven by our premium Sports Fashion business with an impressive performance in Europe (+27%) and North America (+15%), supported by a strong performance in our more mature UK market (+8%). This performance continued in the important back to school period.
“We have made good progress delivering on our strategic pillars, focusing on expanding the JD brand and we will open more than 200 JD stores worldwide in this financial period. We are going to accelerate JD brand growth in Europe through purchasing the non-controlling interest in both ISRG and MIG, and the acquisition of GAP stores in France. This is alongside the proposed acquisition of Courir in the region, which will, when completed, enhance the Group’s existing portfolio of complementary concepts, bringing into the company its market-leading focus on the female customer. Meanwhile, we are building and investing in talent and infrastructure to support future growth.
“Our first half performance would not have been possible without the efforts of our people across the world and I am extremely grateful for their continued hard work and commitment. I would also like to thank outgoing CFO Neil Greenhalgh specifically for his support since I joined and for his years of service to JD. I look forward to working with Dominic Platt, who will start as our new CFO in October 2023.
“Looking ahead, our core consumers remain resilient in the face of the ongoing global macro-economic challenges. The JD brand continues to strengthen its global presence, supported by our strategic partnerships with much-loved brands and our strong balance sheet.”
Performance summary
| 26 weeks to | 26 weeks to | Year | |
| 29 July | 30 July | on | |
| 2023 | 2022 | Year | |
| £m | £m | £m | |
| Revenue2 | 4,783.9 | 4,418.1 | 8.3% |
| Gross Profit %2 | 48.0% | 48.5% | |
| Operating profit before adjusted items1 | 398.4 | 418.1 | (4.7)% |
| Net interest expense | (24.9) | (34.6) | |
| Profit before tax and adjusted items1 | 373.5 | 383.5 | (2.6)% |
| Net cash at period end3 | 1,276.5 | 1,013.1 | 26.0% |
| Statutory measures | |||
| Operating profit | 400.1 | 332.9 | 20.2% |
| Net interest expense | (24.9) | (34.6) | |
| Profit before tax | 375.2 | 298.3 | 25.8% |
| Basic earnings per share (GBp) | 4.65 | 3.58 | 29.9% |
| Adjusted earnings per share1 (GBp) | 4.62 | 5.23 | (11.7)% |
| Interim dividend per share (GBp) | 0.30 | 0.13 | 130.8% |
1Alternative performance measure (APM) – further detail setting out the background to the APMs (and a reconciliation to statutory measures) is provided after the CFO Review
2This period reflects the reclassification of delivery income from operating costs to revenue, in line with the FY23 year end. Nil cash and profit impact but +30 basis points impact on GP% and -30 basis points impact on operating costs as a % of revenue
3Net cash consists of cash and cash equivalents less interest-bearing loans and borrowings
Financial highlights
· Group revenue growth of 8% to £4,783.9m and 12% on an organic1,3 basis, reflecting the impact of non-core UK divestments
· Premium Sports Fashion delivered 15% organic growth, or 9% like-for-like1,4 (LFL); further market share gains in key regions
· Gross margins robust at 48% and well above pre-pandemic levels; H1 more normal promotional environment
· Strong performance from our North America premium Sports Fashion fascias: organic growth of 15%, LFL growth of 9% and EBIT up 12%
· Group Profit before Tax and adjusted items of £373.5m, reflecting a more normal H1 contribution of c.35% and investment in our people, systems and supply chain. After incorporating the adjusted items, Group Profit before Tax was £375.2m
· Balance sheet net cash of £1,276.5m, up £263.4m versus 12 months ago
· Inventory levels well managed and in line with sales growth expectations
· Interim dividend increased; returning to pre-pandemic dividend cover1
Strategic highlights
· Delivering progress on all key elements of our strategy
· On track to add over 200 new JD stores globally by January 2024
· Strong trading from US complementary concepts DTLR and Shoe Palace
· New distribution centres on track and began loyalty trial in the UK
· Strong relationships with key brand partners
· New leadership and organisation structure embedding well
3Total sales excluding acquisitions and disposals but including new stores 4Same stores trading for at least 12 months
Current trading and outlook
In the last seven weeks, trading across the Group has continued in line with our expectations. At constant exchange rates, organic sales growth1 was 10%. In addition, we have continued to open new JD stores worldwide and are on track to meet our full-year store targets.
We are acutely aware of how tough the macro-economic environment is for consumers across the world. Despite this context, assuming current exchange rates, we expect the Group’s headline profit before tax and adjusted items for the 53-week period ending 3 February 2024 will be in line with the current market consensus expectations of £1.04 billion.
Enquiries:
| JD Sports Fashion Plc | Tel: 0161 767 1000 |
| Régis Schultz, Chief Executive Officer | |
| Neil Greenhalgh, Chief Financial Officer | |
| Mark Blythman, Director of Investor Relations | |
| Advisors | |
| Investec Bank Plc – David Flin | Tel: 0207 597 5970 |
| Peel Hunt LLP – Dan Webster | Tel: 0207 418 8869 |
| FGS Global – Rollo Head, Jenny Davey, James Thompson | Tel: 0207 251 3801 |