JD raises profit targets again despite footwear shortages
JD Sports has lifted its profit forecasts again on the back of strong sales despite shortages of key footwear lines.
The retailer saw shares lift higher after it said it was “reassured” by trading over the 14 weeks to May 7.
It reported like-for-like sales for the period had been more than 5% higher than the same period last year.
JD Sports added the sales growth came despite “a backdrop of a global shortfall in the supply of certain key footwear styles” amid continued pandemic restrictions in major regions for production.
Nevertheless, the firm said it expects this to improve progressively during the year.
The retailer told shareholders it therefore expects pre-tax profits for the year to January 29 will be around £940 million.
Today's statement should reassure investors that the group remains on track as it delivers a year of good growth in revenues and earnings
Eleonora Dani, Shore Capital
JD Sports had already increased its profit target to at least £875 million for the year in an update in January.
The group added that although recent trading has been positive, it is still wary of the uncertain economic backdrop.
The company said in a statement: “Whilst we are pleased with the trading to date, which is at least in line with the group’s expectations, we remain conscious of the headwinds that prevail at this time, including the general global macro-economic and geopolitical situation.”
Eleonora Dani, equity analyst at Shore Capital, said: “The company is tightly managed with excellent cash generation, tight stock, and cost controls.
“Today’s statement should reassure investors that the group remains on track as it delivers a year of good growth in revenues and earnings.
“We believe that the shares will run in relief today on the back of another profit upgrade.”
Shares in the business were 2.7% higher in early trading on Thursday.