JD Sports Fashion Plc (LON:JD), the leading retailer of sports, fashion and outdoor brands, has announced its third quarter trading update for the 13 weeks to 2 November 2024.
Régis Schultz, CEO of JD Sports Fashion Plc, said: “After a good start to the period, helped by strong back-to-school sales, we saw increased trading volatility in October, particularly in North America and the UK, reflecting elevated promotional activity and mild weather. Against this backdrop, we maintained our commercial discipline, improving gross margin by 0.3%pts while still delivering 5.4% organic sales growth. In addition, we made further, strong progress on our long-term growth strategy including opening 79 new JD stores across the world.
We have performed well in the key trading events this year and we are well positioned for the upcoming peak season. The trading environment remains volatile though and, following October trading, we now anticipate full year profit to be at the lower end of our guidance range.”
We had a strong back-to-school period but we saw much softer consumer demand and trading toward the end of the period, reflecting elevated promotional activity, unseasonable weather and a cautious consumer, with evidence supporting suppressed demand in the US ahead of the election. Against this backdrop, we maintained our operating discipline to deliver on our long-term commercial strategy rather than a short-term sales focus. As a result, gross margin for the Group in the period increased 0.3%pts to 48.1% with the year-to-date gross margin for the Group now at 48.2%, in line with the corresponding period.
Driven by our successful store rollout programme, organic sales growth in the period was 5.4% with year-to-date organic sales growth of 6.1%. The more volatile environment was reflected in like-for-like (LFL) sales for the period down 0.3% with a good August and September offset by a softer October. At the end of the period, year-to-date LFL sales growth was 0.5%. On a LFL basis, stores continued to outperform online and footwear continued to outperform apparel in the period.
All segments achieved organic sales growth in the period, driven by new space growth in JD and Complementary Concepts, and by LFL sales growth in Sporting Goods & Outdoor. Regionally, Europe performed well, delivering both LFL sales growth and organic sales growth, with softer trading in the period being seen elsewhere.
We also made strong strategic progress. In the period, we opened 79 new JD stores, taking the total number of openings by the end of Q3 to 181, highlighting the ongoing success of our global JD store rollout programme. The total number of stores at the period end was 4,541, up 1,224 from the start of the year, including 1,179 stores acquired with Hibbett.
We have also made good progress on the process to complete the acquisition of Courir. Following the satisfaction of all regulatory conditions, we now anticipate this transaction will complete shortly, adding a strong and growing, female-orientated fascia to complement our global portfolio.
Given the volatile trading environment, and following October trading, we now expect Profit before tax and adjusting items (PBT) to be at the lower end of our original guidance range of £955-1035m. Within this full year guidance, we still expect Hibbett to contribute around £25m to PBT and, at current exchange rates*, for currency to reduce PBT by £15m, compared to the rates used in setting the original guidance.
*The £955-£1,035m guidance range was based on 1.25 for the US Dollar and 1.15 for the Euro. Average rates to the end of Q3 were 1.29 for the US Dollar and 1.19 for the Euro. Current rates used for Q4 are 1.26 for the US Dollar and 1.20 for the Euro.
Regional revenue performance
| Q325 | Like-for-like | Organic |
| UK | (2.4)% | (0.1)% |
| Europe | 3.5% | 10.4% |
| North America | (1.5)% | 5.9% |
| Asia Pacific | (3.8)% | 5.0% |
| Group | (0.3)% | 5.4% |
| YTD | Like-for-like | Organic |
| UK | (2.7)% | (1.1)% |
| Europe | 2.7% | 10.1% |
| North America | 1.8% | 9.1% |
| Asia Pacific | (1.2)% | 8.6% |
| Group | 0.5% | 6.1% |
Segmental revenue performance
| Q325 | Like-for-like | Organic |
| JD | (1.6)% | 6.2% |
| Complementary Concepts | (1.3)% | 0.4% |
| Sporting Goods & Outdoor | 6.0% | 5.5% |
| Other | 0.9% | 0.9% |
| Group | (0.3)% | 5.4% |
| YTD | Like-for-like | Organic |
| JD | (0.2)% | 7.7% |
| Complementary Concepts | 0.7% | 1.1% |
| Sporting Goods & Outdoor | 2.4% | 2.9% |
| Other | (2.7)% | (2.7)% |
| Group | 0.5% | 6.1% |
Analyst and investor Q&A
A call with analysts and investors will take place at 0930 (BST) on 21 November 2024. To register for the live audio cast (listen only), please use the following link: https://events.q4inc.com/attendee/833209352. To register for the live conference call (option to ask questions), please use the following link: https://registrations.events/direct/Q4I474548.
JD Sports Financial calendar
14 January 2025: Peak trading statement
March 2025: Capital Markets Day, USA
May 2025: FY25 results
