JD Sports Fashion Plc Continue to make excellent progress with Group EBITDA increasing by a further 27%

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JD Sports Fashion Plc (LON:JD), a leading retailer of sports, fashion and outdoor brands, today announces its Preliminary Results for the 52 weeks ended 2 February 2019 (2018: 53 weeks ended 3 February 2018).

	2019	2018	% Change
	£m	£m

Revenue	4,717.8	3,161.4	+49.2%

Gross profit %	47.5%	48.4%

EBITDA*	488.4	385.2	+26.8%
Depreciation / amortisation	(126.9)	(76.4)

Operating profit (before exceptional items)*	361.5	308.8	+17.1%
Net interest expense	(6.3)	(1.4)

Profit before tax and exceptional items*	355.2	307.4	+15.5%
Exceptional items	(15.3)	(12.9)

Profit before tax	339.9	294.5	+15.4%

Basic earnings per ordinary share	26.90p	23.83p
Adjusted earnings per ordinary share*	28.44p	25.15p

Total dividend payable per ordinary share	1.71p	1.63p

Net cash at period end (a)	125.2	309.7

a) Net cash consists of cash and cash equivalents less interest-bearing loans and borrowings

b) Throughout this release ‘*’ indicates first instance of a term defined and explained in the Glossary at the end of these preliminary results

Group Highlights

· Record result with EBITDA (before exceptional items) increased by a further 26.8%, being more than £100 million, to £488.4 million (2018: £385.2 million).

· Depreciation includes £29.4 million (2018: £nil) from the combined Finish Line and JD business in the United States in the 33-week period post acquisition.

· Headline profit before tax and exceptional items increased by 15.5% to £355.2 million (2018: £307.4 million).

· Profit before tax increased to £339.9 million (2018: £294.5 million).

· Encouraging total like for like sales* growth in global Sports Fashion fascias of more than 6% achieved against a backdrop of widely reported retail challenges in the Group’s core* UK market.

· Robust gross margin performance in like for like Sports Fashion businesses*.

· International development of the JD fascia continues:

a) Net increase of 39 stores (2018: 56 stores) for the JD fascia across Europe

b) A further 34 JD stores opened in the Asia Pacific region in the year (2018: nine stores)

· Acquisition of Finish Line in the United States significantly extends the Group’s global reach with the trial of the JD fascia delivering encouraging early results.

· Double digit EBITDA maintained in the Outdoor fascias after a particularly weather-challenged trading period.

· Revenue, gross margin and operating profit before exceptional items of the two business segments are tabulated below:

Period to 2 February 2019	Sports Fashion £m	Outdoor £m	Total £m

Revenue	4,296.4	421.4	4,717.8

Gross margin %	48.0%	42.5%	47.5%

EBITDA	478.4	10.0	488.4
Depreciation / amortisation¹	(112.6)	(14.3)	(126.9)
Operating profit / (loss) before exceptional items	365.8	(4.3)	361.5

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¹ Depreciation / amortisation includes non-trading charges for the amortisation of various fascia names and brand names consequent to the accounting on acquisitions. These charges are as follows:

· Sports Fashion: £7.5 million (2018: £2.7 million)

· Outdoor: £4.5 million (2018: £4.5 million)

Period to 3 February 2018	Sports Fashion £m	Outdoor £m	Total £m

Revenue	2,745.0	416.4	3,161.4

Gross margin %	49.2%	43.5%	48.4%

EBITDA	362.2	23.0	385.2
Depreciation / amortisation	(62.2)	(14.2)	(76.4)
Operating profit before exceptional items	300.0	8.8	308.8

· Final dividend payable increased by 5.1% to 1.44p (2018: 1.37p) bringing the total dividend payable for the year to 1.71p (2018: 1.63p) per ordinary share, an increase of 4.9%.

Peter Cowgill, JD Sport Fashion Executive Chairman, said:

“I am very pleased to report that the Group continues to make excellent progress with Group EBITDA (before exceptional items) increasing by a further 27%, being more than £100 million, to £488.4 million (2018: £385.2 million). The headline profit before tax and exceptional items increased by a further 16% to £355.2 million (2018: £307.4 million) and, after delivering a headline profit of £100 million for the first time in the year to January 2015, the headline profit has now increased by more than £250 million over the subsequent four years, a compound rise in excess of 37% per annum. The Group profit before tax increased by 15% to £339.9 million (2018: £294.5 million).

“We firmly believe that the elevated and dynamic multibrand multichannel proposition of the core JD fascia, which enjoys the ongoing support of the key international brands, has the necessary agility to continue to exceed consumer expectations and prosper in an increasing number of international markets.

“We believe that our acquisition of the Finish Line business in the United States, the largest market for sport lifestyle footwear and apparel and the home to many of the global sportswear brands, will have positive consequences for our long-term brand engagement whilst significantly extending the Group’s global reach. We maintain our belief that Finish Line is capable of delivering improved levels of profitability.

“Given the significance of Easter trading to the overall result of the Group and the change in the timing relative to last year, any announcement of like for like sales performance in the year to date would lack precision. However, we are pleased with the continued underlying positive performance of the Group and are excited by the major developments ahead.”