In an update on its performance through the Christmas selling period, JD Sports Fashion said that demand has remained robust throughout the second half of 2020, including the key months of November and December, despite temporary store closures in many territories. As a result, revenues for the 22 weeks to Jan. 2, 2021 grew by 5 percent from the year-ago period on a comparable basis, led by e-commerce.
The group anticipates that its pre-tax profit for the full year to Jan. 30, 2021 will be “significantly ahead” of analysts’ expectations, which average £295 million (€327m-$398m), to reach at least 400 million pounds sterling (€443m-$539m). The final results for the year are due to be published on April 13, 2021.
The favorable projection sent the company’s share price up by 12 percent in early trading, reaching a 12-month high, but it subsequently eased down to a level close to the previous closin. The forecast came after the company released better-than-expected sales figures for the first half of the year, ended Aug. 1, despite the coronavirus pandemic. It predicted then a pre-tax profit of £265 million for the year.
Looking ahead, the management expects operational restrictions from the pandemic to impact at least the first quarter of the new financial year, indicating that its stores in the U.K. are likely to stay closed until at least Easter, and that retail lockdowns in other countries are possible at any time.
JD’s current best estimate is that its pretax earnings for the next financial year, ending on Jan. 29, 2022, will be 5 to 10 percent ahead of the current year. The company noted that it is able to scale down activity in stores and scale up the digital channels “at extremely short notice.”
The U.K.-based retail group, which owns JD Sports, Blacks Leisure, Millets, Go Outdoors and the U.S.-based Finish Line, announced in December the acquisition of Shoe Palace, which describes itself as “one of the most trusted athletic footwear and apparel retail chains in the United States,” and other assets in a cash and stock deal worth over $680 million in total. Last week, it announced the acquisition of Wellgosh, an independent menswear retailer based in Leicester, for an undisclosed sum.