Annual profits at Sports Direct have plunged amid its exposure to struggling department store chain Debenhams.
Pre-tax profits fell to £77.5m in the year to 29 April, partly due to a £85.4m hit the retailer took on the value of its near-30 per cent stake in Debenhams.
Sports Direct chairman, Keith Hellawell, told media: “In terms of statutory reporting, our profit before taxation has reduced by 72.5%, which arises predominantly from the profit on sale of the Dunlop business and the profit on the sale of JD Sports shares included in the results for the prior period and the recognition of the net losses on our strategic investment in Debenhams in the current period.”
Sports Direct’s UK sales were down 2 per cent, although international sales helped total revenue rise by 3.5 per cent.
Chief executive Mike Ashley is reportedly trying to revive sales and profit growth with smarter stores that sell more premium products from the likes of Nike and Adidas. The retailer calls this its “high street elevation strategy”.
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