Sports Direct Sees £400m Wiped Off Value

Mike Ashley's Sports Direct empire has seen shares slump for a second day after the business issued a "clarification" on profits following media interviews given by its controversial founder.

The stock fell by more than 5%, adding to a decline of more than 10% in the previous session.

It (Other OTC: ITGL - news) means the company has dropped by more than 15%, seeing around £400m wiped off its value, since Mr Ashley's interviews with a series of outlets including Sky News on Monday.

The interviews saw the tycoon come out fighting over demands by MPs to quiz him on working conditions.

Mr Ashley, who also owns Newcastle United football club, called the parliamentarians "a joke" and reserved particular scorn for arch-critic and former Labour leader Ed Miliband , saying he would like to "box his ears".

But shareholders were taken aback by the strength of his remarks on how badly the controversy had affected the group's performance, after he told The Times: "We are in trouble, we are not trading very well. We can't make the same profit we made last year."

The comments sent Sports Direct's shares more than 10% lower on Tuesday prompting it to issue a clarification a day later "in the light of recent press coverage" - but it only saw shares fall again.

It said earnings for the full year to the end of April would be "at or around the bottom of the range" it had set out in January - when it had set out a profit warning that saw forecasts trimmed, blamed on unusually mild weather over the Christmas period.

Now (NYSE: DNOW - news) , Mr Ashley appears to have placed the blame firmly with his critics.

He said in his newspaper interview: "We are supposed to be taking the profits up, they are not supposed to be coming down, and the more the media frenzy feeds on it, the more it affects us."

Shares (Berlin: DI6.BE - news) in Sports Direct are now worth less than half of their value at the start of December, with the plunge seeing the group relegated from the FTSE 100 Index of the top UK-listed companies.

The company has defended the way it treats its workforce after a Guardian investigation into conditions among its warehouse staff.

Mr Ashley's latest intervention came as he faced the threat of being held in contempt of Parliament for refusing to appear before the Business, Innovation and Skills select committee to answer questions about the issue.