- JD revealed its organics sales rose by 5.8% in the year ending 1 February
JD Sports shares rose sharply on Wednesday as the sports retailer’s sales met market expectations after a bad run of weak performance and profit downgrades.
The high street retailer revealed its sales rose by 5.8 per cent on an organic basis in the year ending 1 February, having guided in January for an increase of around 5 per cent.
Organic turnover jumped by 10.5 per cent in Europe, 9.5 per cent in the Asia-Pacific territory, and 7.5 per cent in North America.
JD also said trading at Alabama-based Hibbett and French trainers seller Courir, two companies it bought during the year, was in line with expectations.
Consequently, the firm anticipates its annual pre-tax profits will be somewhere within its guidance range of £915million to £935million.
However, just under 40 per cent of JD Sports sales are now in the US, meaning the group is highly exposed to new tariffs. Its latest guidance did not account for this.
Strong growth: The high street retailer revealed its sales rose by 5.8 per cent on an organic basis in the year ending 1 February
JD forecasts further revenue growth this financial year, with recent acquisitions set to provide an estimated 10 per cent uplift and new space an additional 4 per cent boost.
Its takeover of Hibbett and Courir, which cost the group a combined £1.3billion, added nearly 1,500 stores to its portfolio.
The Bury-based business additionally believes earnings will be in line with consensus expectations of £920million, but this excludes the impact of tariff measures.
JD gets most of its products via third-party brands that source from Asia, especially China, Cambodia, and Vietnam, three countries set to be massively impacted by President Donald Trump’s tariffs.
Chinese-made products imported to the US are subject to a 104 per cent levy, while the equivalent tariff for goods manufactured in Cambodia and Vietnam is 46 per cent and 49 per cent, respectively.
JD entered the American sportswear market in 2018 when it bought the retailer Finish Line for $558million in cash.
Since then, the company has expanded its presence with the acquisitions of footwear brand Shoe Palace, Baltimore-based DTLR, and Hibbett in July 2024, which made the US JD’s largest market by sales.
The firm, which is majority-owned by Pentland Group, also announced it was making ‘significant progress’ on its medium-term plans.
It has opened around 400 new JD stores globally in the past two years, launched new distribution centres in Australia, the US and the Netherlands, and sold about 30 non-core companies.
Régis Schultz, chief executive of JD, said the business ‘operates within an attractive, long-term growth market, and we are well positioned to continue growing market share.
‘We have strong brand partner relationships and an agile, multi-brand model which allows us to drive, and respond quickly to, market trends.’
JD Sports shares topped the FTSE 100 risers by late Wednesday afternoon after soaring 10 per cent to 69.5p.
Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said: ‘JD Sports investors breathed a sigh of relief as full-year organic sales growth landed in line with market expectations. A string of weak sales and profit downgrades in recent times means that simply meeting expectations is viewed as a win.
‘There’s also the elephant in the room – tariffs. The Hibbett acquisition means that the US is now JD Sports’ largest region by sales.
‘Many sports goods are manufactured in countries like Vietnam and China. Given that President Trump’s tariffs have heavily targeted these regions, the cost of goods produced there and brought into the US is expected to rise.
‘JD’s guidance for profits to remain broadly flat this year excludes the impact of these recent tariffs, meaning there’s serious scope for guidance to be downgraded as the year progresses.’
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