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JD Sports has lowered its full year profit guidance to between £915m – £935m, down from its ambitious £1bn target after seeing lower than expected revenue growth over the festive period.
The company saw a constant currency organic revenue growth of 6.0% with like-for-like growth of 1.8% for the 22 weeks ended 30 December 2023.
The company stated that apparel revenue growth was impacted by milder weather from the second half of September.
Furthermore, the peak trading season, across the market, was softer and more promotional than it anticipated, reflecting more cautious consumer spending.
JD’s gross margin rate for the period was in line with last year which was lower than its expectations due to the elevated level of promotional activity during the peak trading period.
Therefore the company now anticipates its full-year gross margin rate will be slightly lower than last year.
The retailer also stated that FY24 will be impacted by a reclassification of certain capital expenditures into operating expenses, expected to be £7m, and lower interest income of £8m following the ISRG NCI acquisition.
Régis Schultz, CEO of JD Sports, said: “We have made good progress against our five-year strategic plan, delivering global organic revenue growth of 6% 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. We are confident in our strategy and we continue to invest in our supply chain, systems and stores, supported by our strong cash generation and healthy balance sheet.”
