Sports Direct retail sales climb 9.4%

The sports retailer also reported total group sales were £370m, up from £355m, and gross profit is £154m, up from £143m.

Revenue in the brands division declined 22.8% to £44m, and corresponding gross profit declined 14.3% to £18m.

Numis analyst Andrew Wade said: “Sports Direct traded hard through the Christmas period, delivering sales comfortably ahead of our expectations, albeit achieved by the sacrifice of some gross margin progression.”

He said the results, against tough comps last year, implies a UK retail like-for-like rise of up 6%.

In the period, Sports Direct opened 12 stores and closed three. Internationally, it opened a further three stores and closed two smaller stores.

Dave Forsey, chief executive of Sports Direct, said: “The board is pleased with the group’s trading performance during the quarter. The UK retail division continued to deliver strong results, particularly in online sales at Sportsdirect.com, where sales accounted for over 5% of the total UK revenue during the quarter.

“Cash generation in the period has been strong and we expect year end net debt to be similar to and not more than the half year level. Trading since the end of the quarter has remained encouraging.”

At the interim results in December last year, the retailer said it expected to achieve full year underlying EBITDA of at least £155m, after the £10m charge for the bonus share scheme. Based on current trading and subject to current exchange rates, it now said it expects EBITDA of at least £160m.

Separately, the Competition Commission has provisionally cleared the acquisition by Sports Direct of 31 JJB stores. It ruled that the acquisition would not necessarily lead to a substantial lessening of competition nor any adverse effects for consumers.