JD Sports expects full year profit to be at lower end of guidance
JD Sports has said its full year profit is likely to be at the lower end of expectations after trading was hit by a volatile environment in October.
In the 13 weeks to 2 November, the retailer’s like-for-like sales fell by 0.3% after a good August and September was offset by softer sales in October, which was due in part to bigger discounts and unseasonable weather.
Meanwhile organic sales growth was 5.4% in the third quarter period.
The retailer said it was impacted by suppressed demand in the US ahead of the presidential election, which meant sales in North America declined by 1.5%.
Like-for-like sales in the UK and Asia Pacific were also down, falling by 2.4% and 3.8% respectively, although like-for-like sales in Europe increased by 3.5%.
Régis Schultz, chief executive of JD Sports, said: “After a good start to the period, helped by strong back-to-school sales, we saw increased trading volatility in October, particularly in North America and the UK, reflecting elevated promotional activity and mild weather.
“Against this backdrop, we maintained our commercial discipline, improving gross margin by 0.3%pts while still delivering 5.4% organic sales growth.
“In addition, we made further, strong progress on our long-term growth strategy including opening 79 new JD stores across the world.”
Due to the volatile trading environment and softer October, JD Sports now expects its full year pre-tax profit before adjusting items to come in at the lower end of its guidance range of between £955 million and £1.035 billion.
Schulz said: “We have performed well in the key trading events this year and we are well positioned for the upcoming peak season. The trading environment remains volatile though and, following October trading, we now anticipate full year profit to be at the lower end of our guidance range.”
