Reported pre-tax profit at Sports Direct dropped by 67% to £45.8m in the 26 weeks to 29 October, while its UK sales suffered due to reduced promotional activity online.
On an underlying basis, profits rose 23% year on year to £88m. The company said it is ”profitable, highly cash generative and has considerable financial resources”.
Group revenue rose by 4.7% to £1.7bn, but its UK sports retail revenue fell 1% due to reduced online promotional activity and store closures.
However, its bullish chief executive, Mike Ashley, said: “Our high street elevation strategy is currently delivering spectacular trading performance within our flagship stores. We intend to open between 10 and 20 new flagship stores next year.
”While our reported profit before tax has been impacted by fair value adjustments and transitional factors such as the disposal of assets in FY17, our underlying profit before tax remains healthy. We will continue to invest for the long term.”
Sports Direct said it expects growth in its underlying EBITDA during the 2018 financial year to be within its forecasted range of 5% to 15%.
Yesterday, Sports Direct investors voted to block a proposed £11m payout to Mike Ashley’s brother John. The company said today that it “considers all these matters to be closed. We now intend to move on.”