JD Sports Fashion posted higher-than-expected sales during the Christmas period despite difficult weather conditions in the U.K. Comparable store sales were up by 2.5 percent in the five weeks to Jan. 1. In the 48 weeks to Jan. 1, comparable revenues rose by 3.1 percent compared with a 2.8 percent increase in the 30 weeks to Aug. 28. The company also managed to maintain its gross profit margins in line with the previous year.
The British retailer expects to beat market expectations for the group's profit before tax and exceptional items for the full year ending on Jan. 29,.which were projected by analysts to reach £75.4 million (€89.3m-$119.6m). The company will release its results on April 13.
JD warned that the next fiscal year would be affected by the increase in value-added tax (VAT) in the U.K. and inflationary pressures largely due to increased raw material prices. On Jan. 4, the U.K. raised the standard rate of VAT to 20 percent from 17.5 percent. In November, U.K. inflation rose by 3.3 percent year-on-year and clothing was one of the most significant drivers, along with food and non-alcoholic beverages.
