JD Sports Rises 4% On Improving North America Sales, New Share Buyback

Shares in JD Sports moved higher after the athleisure retailer announced improving sales in North America and announced plans for a new £100 million share buyback programme.

At 98.1p per share, JD shares were last 4.3% higher in midweek business.

The FTSE 100 company said like-for-like sales dropped 2.5% in the 26 weeks to 2 August. On an organic basis, revenues were up 2.6% year on year.

For the second quarter, like-for-like sales dropped 3%, but rose 2.2% on an organic basis.

In North America, which is JD’s single largest market and responsible for 36% of sales, the firm said it enjoyed a “good performance in newer footwear lines [in quarter two] following a shift in the product launch schedule from quarter one.”

Like-for-like sales dropped 3.8% over the half year, but the rate of decline improved to 2.3% over the second quarter.

JD also reported a “strong performance in apparel” and “much improved overall online performance, supported by a better online range and focused marketing.”

UK And Europe Worsen

However, JD’s sales declines worsened in the UK and Europe over the second quarter, which it attributed to “last year’s Euro 2024 football tournament (replica kit and in-store cross-sell) and athletic footwear for women.”

In the UK, where the FTSE 100 company sources 34% of sales, like for like-sales were down 6.1% in the second quarter.

This pulled corresponding first half sales 3.3% lower.

In Europe, like-for-like sales fell by a milder 1.1% during quarter two. They were down 0.4% over the first half.

JD generates 26% of turnover from its non-British European regions.

In Asia, like-for-like sales rose 0.3% in the last quarter, reducing the first-half decline to 2.4%.

Cautious Outlook

Looking ahead, JD said “we remain cautious given the continued strains on consumer finances, unemployment risk, and the ongoing shift in the footwear product cycle.”

The retailer expects full-year pre-tax profit before tax before adjusting items to be in line with current forecasts. This is pegged at £885 million, down from £923 million last year.

However, JD also warned that it continues to assess the potential effect of US trade tariffs on the bottom line.

The firm said “we do not consider direct impacts of US tariffs on JD to be material.” But it added that “on indirect impacts, we continue to monitor the ever-changing landscape on tariffs, keeping in close contact with our brand partners on how they are addressing the situation.”

Fresh Share Buyback

Chief executive Régis Schultz said “we are making strong progress in developing our omnichannel customer proposition, store footprint and supply chain, and we are controlling our costs and cash effectively.”

He added that “across our regions and fascias, in general we see a resilient consumer, albeit very selective on their purchases. We therefore remain cautious on the trading environment going into [the second half].”

Schultz added that “we are well placed to continue growing our market share in the key growth regions of North America and Europe, and confident about the medium-term growth prospects for our industry.”

Reflecting this, Schulz said JD plans to launch a new £100 million share buyback programme. This follows a £100 million repurchase that completed last month.