Sports Direct profits surge in cold snap

SPORTS Direct said the recent cold snap had been a “net positive” as winter products flew off its shelves, boosting its shares to a three-year high.

Britain’s largest sports retailer said while other chains had been hit by the freezing temperatures, the temperatures had given it a lift,

The company posted a 40 per cent rise in first-half profit, helped by a boost from this summer’s World Cup.

It made an underlying profit before tax of £100.7m for the 26 weeks to 24 October, up from £71.9m in the same period last year.

The results for the group, controlled by Newcastle United owner Mike Ashley, are in stark contrast to struggling rival JJB Sports which issued a profit warning earlier this month, blaming severe winter weather as a contributory factor.

Chief executive Dave Forsey said: “With us you get a lot of product which is very appropriate for this type of weather and we would benefit from having a lot of winter coats, footwear, gloves, hats and scarves.”

He said snow-related disruption in parts of the country had also driven traffic to the internet business of the group which owns Sports World and Lillywhites stores as well as brands including Slazenger, Lonsdale and Dunlop.

Forsey said a step-up in Sports Direct’s television advertising in December was not
designed to hit JJB while it was in trouble.

“We concentrate on our own business,” he said, noting the campaign was designed “to reinforce the value that we offer and the range of products that we offer in these times.”

Sports Direct said that although it was anticipating a tough start to 2011 it was confident of reaching its full-year target at the end of April of underlying earnings of £195m, including a £10m staff bonus pot.