2024-08-22
https://www.thisismoney.co.uk/money/markets/article-13768125/JD-Sports-boss-shrugs-takeover-speculation-growth-offsets-UK-decline.html
HaiPress
The chief executive of JD Sports Fashion refused to be drawn on takeover speculation on Thursday,as the group demonstrated progress with its US growth plans.
Boss Regis Schultz told reporters 'if we had something (to say) we would have said it,' following reports in early August claiming a potential strategic buyer is interested in acquiring the firm.
JD Sports enjoyed underlying sales growth of 2.4 per cent in the second quarter as a solid performance in its US and European businesses masked a continued decline in the UK.
Speculation: The chief executive of JD Sports said he had 'no comment on rumours' when asked by Reuters about recent bid speculation in the group
But,following a profit warning in January,JD Sports warned the 'global macro environment remains volatile',adding it would 'continue to be cautious on our outlook for the rest of the year'.
The FTSE 100-listed retailer,which sells Nike,Adidas,On,HOKA and other sports brands,maintained its guidance for full-year 2024/25 pre-tax profit and adjusting items of £955million to £1.035billion,up from the £917.2million made the previous year.
The global sports fashion industry is seeing a slowdown this year and there is a high rate of promotional activity in the market.
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Nike,the world's biggest sports brand by revenue,warned in June its sales would fall this year,though Adidas has fared better.
JD Sports said UK like-for-like sales slipped 0.8 per cent in the 13 weeks to 3 August,its fiscal second quarter,having been down 6.4 per cent in the first quarter.
Like-for-like sales were up 5.7 per cent in North America,3 per cent in Europe and up 0.1 per cent in the Asia Pacific region.
JD Sports said: 'The quarter-on-quarter trading improvement was driven primarily by the strength of our multi-brand operating model and softer comparatives with the previous year.'
The trading period included the Euro 2024 soccer championship and the start of the Paris Olympics.
JD Sports shares rose 3.1 per cent or 3.98p to 132.12p in early trading.
Mamta Valechha,consumer discretionary analyst at Quilter Cheviot,said JD Sport's valuation 'remains undemanding,especially when you consider its previous highs'.
The shares are down more than 17 per cent since the start of the year,and remain around 43 per cent off their November 2021 peak.
Valechla said: 'The share price does not currently reflect the strength of JD’s market position and future growth potentials.
'To see a re-rating investors need a bit of reassurance about the Nike turnaround,but hopefully new innovation and exciting product lines in the second half of the year should keep growth on the agenda.'
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