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Sports Direct profits up as bonus scheme pays off

Sportswear retailer Sports Direct increased gross profit 5.4% to £117m in the nine weeks to September 26 as its bonus share scheme paid off.

Sport Direct, which operates more than 470 UK stores under the Sports World, Lillywhites, Field & Trek, Hargreaves Sports, Gilesports and Donnay International fascias, now expects first half results to be “significantly” above last year’s.

Group sales increased 5.4% to £295m over the period. Retail gross profit was up 6.1% to £105m while retail sales jumped 6.9% to £264m.

Sports Direct chief executive Dave Forsey said: “Following the first quarter of our financial year which included the World Cup tournament we remain pleased with the continuing strong underlying performance across all our divisions.

“Our group’s first half results will be significantly above the corresponding period last year, however we believe the early part of 2011 will be extremely challenging for all retailers in the UK.

“The board remains comfortable with targeting a full year underlying EBITDA of £205m before the £10m charge for the bonus share scheme.

 “The board believes that the bonus share scheme has played an important role in delivering this strong performance. The current plan is to implement a new scheme that covers the next two financial years.”

Sports Direct also operates etail operation sportsdirect.co.uk. It sells a mix of third party brands such as Nike, Adidas, Reebok, Umbro and Fila, and group-owned brands including Everlast, Lonsdale, Dunlop, Slazenger and Karrimor.

Sports Direct will announce its interim results for the 26 weeks ending October 24 on December 16.

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