Britain’s JD Sports Fashion raised its annual profit outlook, despite a global shortage of key footwear styles and indicated upbeat sales so far this year. The company said it now expected profit before tax and exceptional items for the year to January 29 to be about £940 million (€1.1bn) and estimates profit for the current financial year to at least equal that figure. It had already increased its profit target to at least £875 million for the year in an update in January.
In a trading update, JD sports said like-for-like sales for the 14 weeks to May 7 were more than 5 percent higher than the same period last year. Sales growth came despite “a backdrop of a global shortfall in the supply of certain key footwear styles” amid continued pandemic restrictions in major regions for production. It added that it had been “reassured” by current trading but was still wary of the uncertain economic backdrop. “While we are pleased with the trading to date, which is at least in line with the group’s expectations, we remain conscious of the headwinds that prevail at this time, including the general global macro-economic and geopolitical situation,” the company said.
Eleonora Dani, an equity analyst at Shore Capital, said the update “should reassure investors that the group remains on track as it delivers a year of good growth in revenues and earnings. We believe that the shares will run in relief today on the back of another profit upgrade.”
The outlook comes after U.K. competition authorities fined JD in February for breaching an order that barred it from integrating further with Footasylum, following competition concerns. The company has delayed publishing its 2022 results. JD Sports said it anticipated being in a position to announce the results for the year ended January 29 “in early to mid-June and will confirm the final date in due course.”
