Sports Direct reports sharp rise in sales
Sports Direct grew its sales by 25% in its first quarter as it followed an aggressive pricing strategy and benefited from an increase in demand for its sportswear in the run-up to the Olympics.
Group total sales for the 13 weeks ending 29 July 2012 were £519.0 million compared to £414.3 million reported in the first quarter of last year. Gross profit increased 20.4% to £211.1 million.
Sports Retail sales in the period increased 19.9% to £441.4 million with Sports Retail gross profit rising by 14.8% to £179.2 million.
In July 2011 Sports Direct acquired a majority stake in designer fashion retailers USC and Cruise. As a result, the company’s Premium Lifestyle sales rose to £28.8 million in the quarter from £3.8 million a year ago, although the prior year comparative is for the period from acquisition on 8 July 2011 to 25 July 2011.
During the quarter, Sports Direct opened eight and closed three “core” stores. In Europe, the company opened nine stores; four in Belgium, two in Hungary, one in Slovenia, one in Portugal and one in France. One store in Cyprus and one store in Belgium were closed. The company also opened a store in Iceland with a joint venture partner.
Dave Forsey, chief executive of Sports Direct International plc, said: "During this unprecedented sporting summer our Retail performance continues to go from strength to strength. As we outlined earlier this year, our unrivalled depth and breadth of product combined with the continued investment in lowering prices to our customers is underpinning this performance.
"Since the end of July trading has remained equally strong, especially within the UK Sports Retail division where sales have also been boosted by the tremendous performance of Team GB at the London Olympics.
"The Board therefore continues to target our 2013 "super stretch" underlying EBITDA objective of £270 million (before the charge for the bonus share schemes)."
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