JD Sports share price craters after slashing profit forecasts
JD Sports has today downgraded its profit forecasts for the current financial year due to higher discounting in its stores and reduced customer spending – with shares falling more than 15 per cent in early trading.
The sports retailer, which has over 3,377 stores worldwide selling everything from Nike trainers to The North Face hiking gear, said organic revenue growth was six per cent for the 22 weeks to the end of December, with like-for-like growth of 1.8 per cent.
This growth was below the company’s expectations. The key Christmas trading period was also “softer and more promotional” than management expected, a result of “more cautious consumer spending.”
Shares were down more than 20 per cent this morning.
As a result of these headwinds, as well as additional costs relating to the recent acquisition of ISRG NCI, the group said it’s now expecting to report profit before tax and adjusted items of between £915m and £935m for the full-year ending 3 February 2024. In September alongside its interim results, the company projected it would meet “market consensus expectations” of £1.04bn in profit before tax and adjusted items for the year.
Régis Schultz, chief of JD Sports said: “We have made good progress against our five-year strategic plan, delivering global organic revenue growth of 6 per cent in the period, against very tough comparisons with last year, and opening over 200 new JD stores in the year.”
“Our key markets have seen increased promotional activity during the peak trading season, driven by a more cautious consumer, but we continue to grow market share,” he added.